GST Refund Process: Step-by-Step Guide on How to Claim GST Refund

GST refund process: Know more about various scenarios where you can claim GST refund, the steps to file GST refund application online, and required documents for GST refund claim.
Business Loan
4 min read
05 October 2023

GST is a tax on goods and services in India. It has three components: SGST, CGST and IGST. After making the necessary GST payments, you will know whether you will receive a refund or not. If eligible, you will have to file for the reimbursement using the GST refund form RFD-01. As simple as it may sound, the GST refund process is technical. A delay or incorrect filing will lead to a rejection of your refund request. Thus, follow the terms and conditions of the GST refund and file the form accurately and on time.

Additional read: How to verify your GSTIN.

What is the GST refund process?

To simplify the process of GST refund, the income tax authorities have translated it into an online process. This means you can claim a refund online using your registered GST account anytime within two years from the relevant date. The relevant date differs based on the condition of your claim. So, abide by the GST refund dates as mentioned below to claim your refunds on time.

  • If you are claiming a refund for excess payment of GST, your date of payment becomes the relevant date.
  • If you are claiming a refund for export or deemed export of goods or services, the date of despatch/ loading/ passing the frontier becomes the relevant date.
  • If Input tax credit (ITC) accumulated as output is tax-exempt or nil, the last date of the financial year to which the credit belongs becomes the relevant date.
  • If you pay excess basis the finalisation of provisional assessment, the date on which tax is adjusted becomes the relevant date.

Additional read: What taxes has GST replaced?

When can the refund be claimed?

Here is when you can claim a GST refund:

  • Due to mistakes or omissions, excess tax is paid.
  • Dealer and deemed export goods or services under the claim of refund or rebate
  • Purchases made by UN bodies or embassies can be refunded.
  • ITC accumulation due to output being tax-exempt or nil-rated
  • Finalisation of provisional assessment
  • International tourists get a tax refund.

What is the time limit for claiming the refund?

Reason for claiming GST refund

Relevant Date

Excess payment of GST

Date of payment

Export or deemed export of goods or services.

Date of dispatch/ loading/ passing the frontier.

ITC accumulates as output is tax-exempt or nil-rated.

Last date of the financial year to which the credit belongs.

Finalisation of provisional assessment.

The date on which the tax is adjusted.

 

Required documents for claiming the GST refund

The following documents are required for claiming the GST refund:

  1. Invoice: The original invoice or a copy of the invoice for which the GST refund is claimed.
  2. Shipping bill/bill of export: The original shipping bill, bill of export, or airway bill for the export goods.
  3. Bank realisation certificate: The original BR copy issued by the bank or evidence of payment in a foreign currency.
  4. GST RFD-01A: A duly filled and self-attested refund application form.
  5. Other documents: Any other specific document as required by the GST authorities for claiming the refund, such as a purchase order, payment receipt, etc.

Steps to submit a refund pre-application form

Here are the steps to submit a GST refund pre-application form:

  1. Access the GST portal and log in using your credentials.
  2. Navigate to the "Refunds" tab and select "Pre-application" from the dropdown menu.
  3. Fill out the pre-application form with the required details, including your GSTIN, refund type, tax period, and refund amount.
  4. Attach supporting documents, such as invoices and purchase receipts.
  5. Review the information entered to ensure accuracy.
  6. Once verified, submit the pre-application form.
  7. After submission, you will receive an acknowledgment along with a unique ARN (Application Reference Number) for future reference.

Ensure that all information provided is accurate and up-to-date to avoid delays in processing your GST refund.

Steps to apply in form RFD-01 for different types of GST refund

Here are the steps to apply for different types of GST refunds using Form RFD-01:

1. Access the GST portal and log in with your credentials.

2. Navigate to the "Refunds" tab and select "Application for Refund" (Form RFD-01) from the dropdown menu.

3. Fill out the form with the required details, including:

  • GSTIN of the applicant
  • Legal name of the registered person
  • Address of the applicant
  • Tax period for which refund is claimed
  • Grounds of refund (select the appropriate category, such as exports, inverted duty structure, etc.)

4. Attach supporting documents relevant to the type of refund you are claiming. For example:

  • For export refunds: Shipping bills, export invoices, etc.
  • For inverted duty structure refunds: Invoices showing the input and output tax details, etc.

5. Verify the information entered in the form and supporting documents.

6. Once verified, electronically sign the form using the appropriate method (DSC or EVC).

7. Submit the form electronically.

8. Upon successful submission, you will receive an acknowledgment along with a unique ARN (Application Reference Number) for future reference.

9. The tax authority will process your refund application and communicate the decision to you within the stipulated time frame.

Ensure that you provide accurate information and attach all necessary documents to avoid delays in processing your GST refund application.

How to calculate GST refund

Computing your GST refund is easy, and you need to subtract the excess you have paid against the total dues you were supposed to pay. This simple calculation will reveal the amount you have been charged or have paid in excess. Once you know the amount, you can claim a refund within the refund processing timeline based on the type of claim you are making.

Keep in mind that you will receive form RFD-03 if the authorities find any discrepancy in your refund application. Otherwise, when you file a GST refund, and it gets verified successfully, you will receive form RFD-02 acknowledgement.

Thanks to the online process, the present GST refund process is effective and highly organised. Following the process elaborated above will help you receive refunds directly in your bank account within 30 days of applying. However, be very particular about the details you mention in the refund form, as once your application is received, it goes through rounds of audit and scrutiny. Steer clear of errors and submit your GST refund application within its deadline to receive faster refunds.

Additional read: What is GSTR?
Additional read: What is GSTR-1
Additional read: What is GSTR-3B

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Frequently asked questions

How do I claim my GST refund?

You can claim your GST refund by filing an online application in form GST RFD-01 within two years from the relevant date, along with the required documents and declaration.

What is eligible for GST refund?

You are eligible for a GST refund if you have paid excess tax, exported goods or services, made zero-rated supplies, claimed lower income than presumptive income, or have unutilised input tax credit.

What is a 90% GST refund?

The 90% GST refund is a provisional refund granted to exporters within seven days of filing the refund application, subject to certain conditions and safeguards. The remaining 10% is paid after verification of documents.

What is the new refund formula in GST?

The new refund formula in GST is based on the net input tax credit (ITC) method. It calculates the refund amount as the product of net ITC and turnover of zero-rated supplies divided by adjusted total turnover.

How many days will it take to get a GST refund?

According to the GST refund process, the GST officer has to process the refund application within 60 days from the date of submission of the application. If the refund is not paid within 60 days, an interest has to be paid on the delayed refund.

Can I get a GST refund on my car?

In India, GST (Goods and Services Tax) is not refundable for cars. While certain export-related scenarios may qualify for a GST refund, the purchase of a car for personal use within the country does not generally allow for a GST refund.

What is the rule for GST refunds?

GST refunds are governed by specific rules. To claim a refund, businesses must file a refund application within the stipulated time frame. Eligibility criteria, proper documentation, and adherence to procedural requirements are essential. The refund process is subject to scrutiny, ensuring compliance with GST regulations for a successful claim.

How do I get my GST refund back?

To get your GST refund, you will need to apply for it through the GST portal by submitting a refund application form. The application will be processed and verified by the GST department, and if approved, the refund amount will be credited to your bank account.

What is the duration within which I can request a GST refund?

You can request a GST refund within two years from the end of the financial year in which the tax was paid. It is important to file for a refund within the specified duration to ensure a smooth and hassle-free process. Late applications may not be accepted, and you may have to undergo additional scrutiny if there is a delay in submission.

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