GST Refund – Meaning & Process
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If a registered taxpayer has paid more than their tax obligations or has excess input against the output tax liability, they may be eligible for a GST refund. They may make a claim after filing a refund application via the GST site with the necessary information.
The GST system has provisions that regulate refunds and aims to standardize and simplify the process. Refund requests can now be made using a standard form (RFD-01). Online claim submission is quick and easy to complete.
Section 54 of CGST Act 2017
Any of the following situations, as defined by Section 54 of the CGST Act 2017, may require the taxpayer to submit a GST refund application:
- On supply of goods or services, tax is paid at a zero-rated tax rate
- Exports of goods and services occur
- Supply of goods to SEZs units and SEZ developers
- Reimbursement of taxes on purchases made by the UN, embassies, etc.
- Refund for a decision, decree, order, or instruction of appellate authority, appellate tribunal, or any court
- Refund of accrued input tax credits due to an inverted duty structure
- A mistakenly excessive payment
- GST paid on items purchased in India and transported outside of the country when foreign visitors leave India will be refunded
- Refund due to the issuance of refund vouchers for taxes paid in advance on goods or services that have not yet been provided
- GST Refund can be claimed in the return furnished under section 39 before the expiry of 2 years.
Documents for GST Refund Application
Documents declaring tax paid, interest or any other amount, proof of tax deposit, invoices and any other documents evidencing export should be attached with the application.
Self-declaration is required where the refund is less than Rs. 2 Lakhs and the incidence of such tax and interest had not been passed to any other person
The GST Refund Procedure
The processing of a GST refund claim in India is now standardized by the GST legislation. The taxpayer must use a specific form RFD 01 along with the required documents in Annexure 1 to the form and submit the requests for GST refunds using the GST Common Portal.
In order to collect the refund amount, the person must also submit returns on a monthly basis. A refund application is only legitimate if it receives an acknowledgment in GST RFD 02 within 15 days after the submission if the application in form GST RFD 01 is correct. If there is any mistake, it will be communicated in GST RFD 03.
The competent officer may issue an order in GST RFD 04 authorizing the refund within seven days of the date of acknowledgment if he is initially satisfied that the amount claimed as a refund is accurate.
The relevant officer shall pass an order for refund in GST RFD 06 also known as a final order and shall issue a payment advice in the form GST RFD 05 for the amount sanctioned as refund and the amount gets electronically credited to the bank account of a registered person.
Relevant Date:
In case of goods exported outside India
In case of services exported outside India
In the case of a supply of goods regarded as deemed exports.
Date of the request for a refund of these exports
Where GST refund arises as a result of any court order, decree, judgment, or direction of any appellate authority.
Date of communication of such decree, order, etc.
In case of a refund of ITC due to an inverted duty structure.
End of the financial year in which such refund arises.
In cases where tax is paid provisionally.
The date on which the tax amount is adjusted after the final settlement.
Where a refund is claimed by any person other than the supplier.
Date of receipt of goods/services.
In any other case
Date when tax is paid.
Why choose us?
Komplytek is a well-known GST consultant in Delhi (NCR). We provide total Goods and Service Tax solutions to our customers, including:
- Obtaining a Goods and Services Tax registration:
- Preparing and filing GST returns on a monthly or quarterly basis.
- Providing advice on a variety of subjects
- Preparation and filing of Goods and Service Tax refund applications, as well as follow-up
- Preparation and submission of yearly tax returns
