Understanding the Different Types of GST Refund Applications
GST Refund Services –The Goods and Services Tax (GST) framework in India offers several refund options to taxpayers under different circumstances. A GST refund application is filed when a taxpayer seeks reimbursement of excess tax paid under the Goods and Services Tax (GST) system. Refunds may arise due to excess input tax credit, tax paid on exports, inverted duty structures, or transaction cancellations. The application must be submitted online through the GST portal, following prescribed rules and timelines. Proper documentation is required, and the refund is processed after verification by tax authorities.
We, Jitesh Telisara & Associates LLP, a CA Firm in Pune & GST Consultant for Filing of GST Returns & GST Refund, can help you not only with the filing of your GST refund application but also with the accurate claiming of GST Refund in timely manner.
Let’s explore the various types of GST refund applications and their eligibility criteria.
- Refund of Excess Balance in Electronic Cash Ledger
At times, taxpayers might end up paying more tax than required, leading to an excess balance in their electronic cash ledger. In such cases, they can file for a refund using Form GST RFD-01 on the GST portal. - Refund of ITC on Export of Goods or Services (Without Payment of Tax)
Businesses that export goods or services under a Letter of Undertaking (LUT) without paying IGST can claim a refund of unutilized Input Tax Credit (ITC). This ensures that exports remain tax-free and do not burden the exporter. - Refund of IGST on Export of Goods or Services (With Payment of Tax)
If a taxpayer exports goods or services after paying IGST, they can claim a refund of the IGST paid. This is typically processed automatically through the GST portal and customs system, ensuring a smooth refund process. - Refund on Inverted Duty Structure
An inverted duty structure arises when the GST rate on inputs is higher than the GST rate on outward supplies, leading to an accumulation of ITC. Businesses facing such a situation can file for a refund of the unutilized ITC. - Refund of Tax Paid on Supplies to SEZ Units/Developers
Supplies made to Special Economic Zones (SEZs) are eligible for GST refunds. If the supply was made without payment of tax under LUT, the supplier can claim a refund of ITC. If tax was paid on such supplies, a refund of GST paid can be claimed. - Refund of Tax on Deemed Exports
Certain supplies, such as those made to Export Oriented Units (EOUs) or specified deemed export categories, are considered deemed exports under GST law. The supplier or recipient can apply for a refund of the GST paid on such transactions. - Refund of Excess Tax Paid Due to Mistake
If a taxpayer accidentally pays excess GST, they can file for a refund under this category. This may happen due to incorrect tax calculations, clerical errors, or system glitches. - Refund in Case of Cancellation of Registration
If a registered taxpayer has an excess balance in their electronic cash ledger at the time of cancellation of GST registration, they can claim a refund of the remaining amount. - GST Refund on Flat Cancellation
If a buyer cancels a booked flat after paying GST to the builder, they may be eligible for a refund, depending on whether the builder has already deposited the GST with the government. If the builder has not yet deposited the GST, they can refund the full amount to the buyer. However, if the GST has already been paid to the government, the builder can issue a credit note and adjust their GST liability, allowing them to process the refund. The GST law permits such refunds only if the credit note is issued within the stipulated time, typically by September of the following financial year or before filing the annual return, whichever is earlier. To claim a refund, the buyer should contact the builder and request reimbursement. If the builder refuses to process the refund, the buyer may approach the GST authorities for resolution.
At Jitesh Telisara & Associates LLP, we are dedicated to offering top-notch GST refund consultancy and GST return filing services, ensuring a smooth and hassle-free online filing experience for our clients across India.
To apply for a GST refund, follow these steps:
- Log in to the GST portal (www.gst.gov.in).
- Navigate to Services > Refunds > Application for Refund.
- Select the relevant type of refund.
- Fill out Form GST RFD-01 and upload supporting documents.
- Submit the form and track the refund status on the GST portal.
