The implementation of GST has affected the business sector both positively and negatively. That was a major reason why many people were sceptical about the implementation of GST. GST Refund process was one of the major concerns of the exporters. Here are some of the points that will make understanding of GST refund process easy for you: –
GST Refund Process
- If there is a supply of Goods or Services or both under bond or letter of undertaking in GST RFD 11, without paying IGST. In that case exporters can claim a refund of unutilized Input Tax Credit.
- If supply of Goods and Services are done with the payment of integrated tax, then a refund of IGST can be claimed.
Situations where you can claim Refund
Refund can be claimed as per section 54(8) of the CGST Act, under following situations: –
- If taxes are reported under wrong head.
- When there are deemed exports.
- If Input Tax Credit is accumulated due to inverted tax structure.
- If the goods and services are supplied to SEZ Unit or SEZ Developer.
- When the tax is paid in advance and then the amount paid is refunded, if there is partial or no supply.
- Export of goods without paying IGST.
- Export of goods with payment of IGST, Rule 96 applicable.
- Export of services with or without paying IGST, Rule 89 applicable for both situations.
Refunds are provided to dealer electronically, as per the provisions of GST Law, based on the application in RFD-01 on the government portal in all the situations mentioned above. There is exception on the exports of goods with the payment of IGST, the details of the exports are to be filled in the table 6A of GSTR-01 form, then this form will be considered as the application for the Refund.
In the 26th GST Council meeting, which was held recently, the council has decided to provide available tax exemptions on the imported goods which will be 6months after the date of 31st March 2018.