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Quick Summary:

To apply for a GST refund, log in to the GST portal and navigate to the ‘Refund’ section under ‘Services.’ Select ‘Application for Refund’ and choose the type of refund you're claiming. Fill in the required details and upload necessary documents, such as bank statements and invoices. Submit the application, and the tax authorities will process your request and issue the refund if everything is in order.

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How to Apply for a GST Refund: A Comprehensive Guide

Discover the process of applying for a GST refund. This guide explains how taxpayers can claim refunds for GST paid on the supply of goods and services, including the steps and requirements involved.

Page last updated

5 May 2024

written By

Afinthrive Advisory

How to Apply for a GST Refund: A Comprehensive Guide

To claim a GST refund in India, the taxpayer must file an application in the prescribed format on the GST portal within the stipulated time period. The application must be supported by relevant documents, such as invoices, shipping bills, and bank statements.

The GST authorities will process the refund claim and may undertake a scrutiny to verify the eligibility of the taxpayer for the refund. Upon verification, the refund amount will be credited to the taxpayer’s bank account electronically.

There are several scenarios in which a taxpayer can claim a GST refund in India, such as :

  • Exports : When a taxpayer exports goods or services, they can claim a refund of the GST paid on the inputs used in the production or supply of the exported goods or services.
  • Inverted duty structure : When the GST paid on inputs is more than the GST paid on the final product, a taxpayer can claim a refund of the excess GST paid.
  • Deemed exports : When a taxpayer supplies goods to a recipient who is eligible for a refund of the GST paid on such supplies, the taxpayer can claim a refund of the GST paid on such supplies.
  • Refund of excess payment : When a taxpayer pays excess GST by mistake or due to any other reason, they can claim a refund of the excess payment.

Essentials of GST Refund :

  • The Refund provision relating to refund in the GST law help to reorganize and standardize the refund processes.
  • Under GST the procedure of claiming a refund is uniform to avoid confusion, so when the GST paid is more than the GST liability a situation of appealing a GST refund arises.
  • The refund procedure helps simplify the trade through the release of blocked funds for various use such as working capital, expansion, and modernization of existing business.
  • Once it is identified that there is a case for claim GST refund then one has to file for the claim through GST Refund Form RFD-01.
  • The form if possible should be prepared by a certified Chartered Accountant and this GST claim needs to be made within 2 years of the “relevant date” of the GST refund application.
  • There are various cases under which a refund can be claimed like a tax refund to international tourists, a refund in case of taxes paid by the Embassy or UN bodies, a refund at the finalization of provisional assessment, etc.
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How Afinthrive Advisory Helps?

Assistance in the calculation, review, and submission of the claim to the concerned jurisdiction.

Calculation, review, and submission assistance

Assistance in obtaining clarification from the department wherever possible for the clients.

Clarification obtaining assistance

Helping in making responses to departmental queries or audits that may be conducted.

Query response assistance

Assistance in succeeding follow-up with the GST department that may be needed in order to get the refund.

Follow-up assistance

Assistance in filing appeals in case the refund is denied or no action is taken up by the concerned authority.

Appeals filing assistance

Follow these key steps to claim your refund efficiently:

💸 Navigating the GST Refund Process

1

✅ Step 1: Check Eligibility

Are you eligible for a refund? Confirm based on Input Tax Credit (ITC), zero-rated supplies, inverted duty structure, or exports.

2

📋 Step 2: Ensure Full Compliance

Make sure all GST filings are up to date, and your records are clean and accurate to avoid delays.

3

📝 Step 3: Select & Prepare the Correct Form

Use Form GST RFD-01 or the appropriate form that matches your refund type.

4

📂 Step 4: Gather Your Documents

Compile all required documents like invoices, export data, bank statements, and shipping bills.

5

✍️ Step 5: Fill Out the Application

Enter correct details such as GSTIN, refund amount, tax period, and attach your supporting documents.

6

🌐 Step 6: Submit on GST Portal

Electronically file the application with all attachments in the correct format via the GST portal.

7

📨 Step 7: Acknowledgment & Verification

Receive an Application Reference Number (ARN). Tax officials may request clarifications or more documents.

8

🔍 Step 8: Processing & Approval

Once verified, the claim will be processed and approved. If successful, funds will be credited to your bank.

9

⚠️ Step 9: Handle Deficiencies or Rejection

If issues are found, you’ll be notified on the portal. Correct and resubmit if needed. Reasons will be provided for rejections.

10

💰 Step 10: Receive the Refund

Approved refunds will be directly deposited into your designated bank account within the timeline.

11

🗃️ Step 11: Maintain Records

Keep all documentation related to your refund for audits or future reference.

FAQs

Get Answers to your most asked questions.

How to claim GST refund?

GST refund application should be filed in GST RFD-01. It is an entirely online process where all relevant documents must be uploaded. After filing, an acknowledgment is generated in Form GST RFD-02. The application is scrutinized by the department, and upon approval, a sanction order is issued in Form GST RFD-06, followed by a payment order in Form GST RFD-05 leading to the payment of refund.

How much time does it take to issue a GST refund?

If there are no queries, GST refund applications are processed and sanctioned within 60 days from the filing date. The refund time limit ranges from 30 to 60 days.

What is a provisional refund under GST?

Provisional refunds under GST are released temporarily (up to 90%) before the scrutiny of documents for zero-rated supplies like exports or supplies to SEZ Developers or Units. These refunds are issued in Form RFD-04 within 7 days after acknowledgment in Form RFD-02.

What is the time limit for filing a GST refund application online?

A GST refund application must be filed within 2 years from the relevant date as specified in Explanation to Section 54 of the CGST Act.

Is there a minimum threshold amount for claiming a GST refund?

Yes, GST refunds cannot be claimed if the amount is less than Rs. 1000.

What is GST refund?

GST refund is the process through which a taxpayer can claim a refund of the GST paid by them on the supply of goods and services.

What are the different scenarios in which a taxpayer can claim a GST refund?

The different scenarios in which a taxpayer can claim a GST refund are exports, inverted duty structure, deemed exports, and refund of excess payment.

What are the documents required for filing a GST refund claim?

The documents required for filing a GST refund claim include invoices, shipping bills, bank statements, and any other supporting documents required for claiming the GST refund.

What happens if a GST refund claim is rejected?

If a GST refund claim is rejected, the taxpayer can file an appeal against the decision of the GST authorities within the stipulated time period.

Is there any penalty for late filing of GST refund claims?

Yes, there is a penalty for late filing of GST refund claims. The penalty is 1% of the refund amount or Rs. 10,000, whichever is higher.