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Who can claim GST Refunds and How? - India Refunds | 2024

Updated: Jun 25

Who can claim GST Refunds and How? - India Refunds | 2024

Understanding the eligibility criteria and the process for claiming refunds is essential to ensure that you receive the amount you're entitled to. In this comprehensive guide, India Refunds will delve into the various scenarios and help you understand who can claim GST refunds and how, in India and the procedures involved.

Section 54 of the CGST Act:

Section 54 of the Central Goods and Services Tax (CGST) Act, 2017, lays down the provisions for claiming a refund of tax paid under the GST regime. Taxpayers who have paid tax on exports, zero-rated supplies, deemed exports, or have unutilised input tax credit (ITC) can claim a refund. The section outlines conditions, restrictions, and procedures for claiming refunds to ensure compliance with GST laws.

Eligibility for GST Refunds:

Taxpayers who claim GST refunds and how, are stated in the following scenarios:

  1. Exports of goods or services

  2. Zero-rated supplies to SEZs, developers, or units

  3. Deemed exports

  4. Refund of unutilized input tax credit (ITC)

Procedure for Claiming GST Refunds:

Taxpayers can apply for GST refunds within two years from the relevant date using Form GST RFD-01 on the GST portal. The refund application must be accompanied by necessary documentary evidence to support the claim. Compliance with conditions and restrictions specified in Section 54 of the CGST Act is essential for a successful refund claim. You can also refer to this guide by India Refunds - GST Refund Process

GST Refund Application - Points to note:

Online Filing: Taxpayers must file GST refund applications online, using the standardized form available on the GST Common Portal.

Monthly Returns: It's essential to file monthly returns to claim the refund amount from the credit balance.

Acknowledgement: Upon filing a refund application, taxpayers receive an acknowledgement within 14 days if the application is acceptable.

Status Communication: The concerned officer must convey the status of the application within 14 days of receipt.

Deficiency Rectification: If deficiencies are identified, the application is returned to the applicant with a list of deficiencies, allowing for rectification and resubmission.

Sanctioning Refunds: Refund claims, if in order, must be sanctioned within 60 days from the date of receipt of the claim.

Time Limit for Deficiencies Memo: Officers cannot issue deficiencies memos after the initial 14-day processing period.

Situations Requiring GST Refund Applications:

  1. Zero-rated Supplies: Tax paid on zero-rated supplies of goods or services.

  2. Exports: Refund applicable for goods or services exported.

  3. Supplies to SEZs: Refund for supplies made to Special Economic Zones (SEZs) units and developers.

  4. Deemed Exports: Refund of tax on goods deemed as exports.

  5. Inverted Duty Structure: Refund of accumulated Input Tax Credit due to an inverted duty structure.

  6. Provisional Assessment: Refund upon finalization of provisional assessment.

  7. Mistake in Payment: Refund due to excess payment made by mistake.

  8. Tourist Refunds: Refunds to international tourists for GST paid on goods in India and carried abroad.

  9. Advance Payments: Refund of taxes paid on advances against undelivered goods or services.

  10. Inter-State/Intra-State Supply: Refund of CGST and SGST paid incorrectly due to a subsequent determination of the nature of the supply.

Understanding who can claim refunds and how in India and the procedures involved is crucial for every taxpayer. Whether it's claiming GST refunds under Section 54 of the CGST Act or income tax refunds under the Income Tax Act, compliance with relevant laws and timely filing of refund applications are key. By following the guidelines outlined in this guide, taxpayers can navigate the refund process with ease and ensure they receive the refunds they're entitled to.

Reach out to India Refunds, India’s first and only advisory firm dealing with issues related to tax refunds of Income Tax and GST, for all your refund requirements and other information.


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