There are various rules and regulations which have emerged in the GST refund process. The GST refund will be needed to maintain under the GST as even a slight delay in the refund process will impact the working capital and cash flow of the manufacturers and exporters. In the current scenario, there is a delay in refunds extending for months, by making refunds available to the concerned manufacturers and exporters, and to get the refunds, it is a challenge as there are strict rules and regulations for the processing of refunds.
Latest Update
23rd December 2021
“CBIC has showcased an advisory related to the Aadhaar authentication for filing of GST refund/Revocation of cancelled applications of registration from 1st January 2022. Read more“
9th December 2021
The high court of Madras state prolonged time of limitation and relief to traders on goods and services tax refund claims. read order
18th May 2021
- “Seeks to prescribe Standard Operating Procedure (SOP) for implementation of the provision of extension of time limit to apply for revocation of cancellation of registration under section 30 of the CGST Act, 2017 and rule 23 of the CGST Rules.” Read Circular
Compulsory to Match Invoices for Exporters’ GST Refund Issues
Numerous exporters are facing problems in claiming ITC (Input Tax Credit) as the government made it compulsory to match GST Invoices for the claim. Experts say that the situation is the result of the late fee waiver of certain forms for companies and suppliers. In several cases, exporters were unable to claim ITC as the forms were not submitted. A corresponding invoice is to be uploaded on the GST portal claiming ITC. All the invoices should be reflected in form GSTR- 2A
There are Various Situations for a Refund under GST, like:
- Excess payment of tax accumulated due to a mistake or misinterpretation
- Export (also deemed export) of goods/services within the claim of rebate or Refund of collected input credit of duty/tax when goods/services are exported
- Finalization of provisional assessment
- Refund of Pre-deposit for filing an appeal, assimilating the refund coming in pursuance of an appellate authority’s order
- Payment of duty/tax during the investigation, but no/ less liability arises in the event of finalization of the investigation/adjudication
- Refund of tax paid on purchases made by Embassies or UN bodies
- Credit collection due to output being tax-exempt or nil-rated
- Credit collection due to inverted duty structure i.e. due to tax rate differential between output and inputs
- Year-end or volume based incentives provided by the supplier through credit notes
- Tax Refund for Foreign Tourists
Read Also: How to File GST Refund Claims Manually? Step by Step Guide
There is an Official Refund Process under the GST:
- An Application form to claim a refund can be filed through the GSTN portal
- An acknowledgement number will be given to the applicant by means of SMS or email when the application is filed electronically
- The changes will be made to the return and cash ledger, and decrease the “carry-forward input tax credit” automatically
- Refund application and relevant documents presented must be scrutinized and adhered to accordingly within a period of 30 days of filing the refund application
- The issue of “unjust enrichment” will be analyzed for reach refund application. In the case of non-qualification, the refund would be transferred to CWF (consumer welfare fund)
- If the refund amount stated crosses the predetermined amount of refund, then the file will through the pre-audit process for sanctioning the refund
- Refund will be credited electronically to the account of an applicant via ECS, RTGS or NEFT
- The application for refund can be made after every quarter
- An amount less than 1000 is not eligible for the refund
Trending Topic: Do You Know about GST E-Way Bill and How it Will Generate?
Delay in Refund and Its Process
Subramanian committee suggested along with the defined GST laws and regulations, the refund application must be entertained within the period of 90 days and must be processed within the same time period. If in any case the application could not be processed within the given time framework, there is a 6 percent interest recommended along with the refund amount.
It was also mentioned by Nirmala Sitharaman (finance minister) who cleared that the refund process will be done within the period of 7 days, and if the process gets late for more than 2 weeks, then the refund will be provided along with the interest.
It is speculated that the process of the refund application will be fast and smooth due to its digital dependability. Also, the data will be uploaded electronically, which depicts that the verification and the detailed analysis of the refund application will be quick.
Latest Updates and News on the GST Refund Topic
GST Refund in Hilly Areas Under Scanner
Taxpayers in hill areas and stations are set to approach the court against the revenue department, which has found a reversal of transitional credit benefited by them on account of the cash balance available in the ledger ahead of GST implementation in the country.
The department has not distributed the available GST refunds to producers and manufacturers of hilly states. Previously, before GST implementation, under the area-based exemption scheme, the manufacturers were provided with tax concessions.
The department now mentions that the transitioning provision available under the newly implemented indirect tax regime referred only to the excess credit available to the taxpayers, and it did not apply to the ledger for cash balance.
Furtherly, the finance secretary also mentioned that the Cash credit can not undergo into GST as only Input Tax Credit can be accounted for transition under the GST regime.
GSTN Intends to Launch Online Application for Refunds
The GSTN organization is also under inclusion to launch an online application to process refunds. Chief Executive Officer Prakash Kumar stated that “A separate online app for claiming Integrated GST refunds for August and September would be made available on the GSTN portal.” The application will provide facilities like saving and uploading sales data of the GSTR 1.
The automated process will also be there to assist in which the data will be extracted and will be to the customs department after a digital signature. The details will be validated by the department, and the further refund process will be initiated accordingly.
GST Refund Advice for Taxpayers
| Follow | Not Follow |
|---|---|
| Only browse official GST portal website – www.gst.gov.in for refunds | Beware to reply any fake message of GST refund process |
| Read here to know GST refund status: https://www.gst.gov.in/help/refund | Leave any attachment or hyperlink in the fake message |
| Must Remember that GSTN never call for personal information and GST refund details on email, WhatsApp or SMS | The taxpayers should never fill any personal details and other contact details on other websites |
| Continually browse official GST portal for new updates | Never dial at the phone number that is mentioned in the fake message |
| Any query please use GST helpdesk – 1800-103-4786. | Do not believe other similar design websites instead of the official portal |
General Queries on GST Refund
Q.1 – What in case if taxpayer miss shipping and invoice bill in a month, can he add the details in subsequent month and get a refund?
Yes, a taxpayer can add the details in subsequent month and can get the refund.
Q.2 – Does GSTR 2 and GSTR 3 needs to be filed for claiming refunds?
If the taxpayers have filed GSTR 1 and GSTR 3B than he doesn’t need to fill other forms to claim refunds.
Q.3 – Is the taxpayer eligible to claim refunds on IGST paid on exports of goods if he has filed GSTR 3B?
Yes, the taxpayer is eligible to get the refunds to claim if he has provided the details of export goods details in GSTR 1 Table 6A and has filed GSTR 3B with relevant tax details
Dear sir,
A cooperative society formed by the Government received grants from the government and it is utilized for the benefits of common public. Can they require GST Registration? If yes.. Can they claim ITC for the fund utilised for the public.. Capital expenditures as well as normal expenses…Society has no benefit from the fund received, but they are paying the GST. Can it be reimbursed? Please help me.
“Please contact to gst practitoner for the same”
Sir,
Filed refund application for 2018-19 for excess payment of tax. But it is showing status as CWF. What does this mean? and what I can do to get my refund processed after this status of CWF.
Dear Sir,
We want to close our firm due to the proprietor not well and not able to work and we have credit in SGST and CGST. Is there any provision for the refund
You can file GSTR 10 for the same
our inputs tax rate is a maximum 18% and the output tax rate is a maximum of 12% and for this reason, our credit maximum balance is in GST accounts. can we claim the balance refunds? And what is the procedure?
Yes, you can claim it as an ITC refund by filing RFD-01
Dear Sir, I applied for a term policy through LIC online portal. While the policy was declined after 45 days and the premium amount refunded, the GST fee of Rs 3267/- was not refunded. Can you please guide me as to how I get my refund?
Please contact to GST practitioner
Sir,
I had booked to go on vacation with a travel agent. But due to natural calamities the trip had to be cancelled. Travel agent has refunded the moneys less GST at 5%. As services were cancelled am I eligible to claim refund of GST?
Regards
Rakshith Urval
As the services have not been rendered, you will get total amount i.e. service charges plus GST in return from the travel agent.
We are the importer of Ferrous, Non-Ferrous and Plastic Scrap materials. While Calculating Custom Duty and IGST, Customs Authority is always taking Higher amount (almost 30%-50%) per unit. For e.g. in case of Import of Plastic Scrap, Invoice Shows material priced as the US $ 375/- per Mt even though Custom Authority considers price as US$ 645/- per MT and accordingly they charged custom Duty and IGST. Also, There is not more 10% of the Value addition in Sales Price hence adjustment of the entire amount of IGST is not possible as a result the good amount of GST is accumulated.
My question as to how we can claim the refund of such accumulated/ non-utilization of GST? This accumulation really hampers our Cash Flow.
Please advice
Thanks and best regards
In the case on inverted duty structure i.e., when the sale price is less than the purchase price and tax paid on the purchase of goods, is more than tax charged on sale then refund of such unutilised credit can be claimed by filing form RFD-01 for such tax period.
WE COULD NOT ABLE TO GET THE REFUND FOR INVERTED DUTY STRUCTURE. CAN ANYBODY HELP US TO PROVIDE THE LATEST CIRCULARS SUPPORTING THE REFUND CLAIM?
Dear Sir/Madam,
It is a very cumbersome process to prepare separate details for Refund Letter, Refund Acknowledgement generated online, Summary of Invoices, etc. Can we get all the forms with Invoices, IGST, etc. details for Refund Application through GEN GST Software itself?
Thanks & Regards,
Jayalakshmi,
In October, We paid the amount in cess instead of CGST, how to refund the amount
You need to file an online application for refund.
You can claim a refund order by logging into your account & avail services options & then refund option. Please note refund amount should be greater than 1000.
Print the refund order copy generated along with supporting like payment voucher from your cash ledger or challans etc, mark self-attestation & submit to your LVO or GST office.
Hi
We filed wrong refund application and the problem is ITC got deducted from ledger for that refund application. Now hoe=w can we delete that application and claim that ITC back in an electronics ledger.
Cancellation is not possible in case of refund application.
If we have claimed less refund in any month by mistake though eligible for the higher refund, can we file a refund application again for the respective month? or we have to file a revised refund application for the respective month ? or can we claim such difference of further refund in the subsequent months?
Due to travel restrictions imposed by the USA, we cancelled our travel policy from TATA AIG (effective 06/06/2021 to 02/12/2021).
However, on cancellation, the amount will be refunded after deductions of charges Rs 236/- plus IGST Rs 7682.69.
Can TATA AIG deduct IGST?
Also, please guide / assist us as to how we get an IGST refund Rs.7682.69
Thanking you,
Regards,
Nayana Limaye
“please contact to GST practitioner for the same”
I am a trading company, I purchase goods export it, I HV exported garment goods, n I HV not mention IGST amount separately, the total amount is inclusive of IGST, I HV only mention my GST no. on an export invoice, am I eligible for the refund of GST paid in my purchase? I am going to make another invoice which would HV IGST included pay my GST of my side, is this correct?
In order to claim the refund of the IGST, payment in the invoice has to be with payment of IGST.
We manufacture parts for Wind Industry, we pay min. 18% for all the raw material and parts purchased, but the output tax that we charge the customer is only 5%, the input tax credit availed has accumulated is very huge, can we claim the refund.
Yes, the refund can be claimed if the output is under taxable rate.
GST Refund Procedure Under Goods and Services Tax India it is only theoretically explained, step by step and what are the supporting documents or proof to be submitted not clear in this answer.
You can read http://www.cbec.gov.in/resources//htdocs-cbec/gst/eflier-refunds14062017.pdf
I have a question. We are exporters of garments and at present do not have clarity on GST. It is said if we take refund of GST then we cannot claim the duty drawback. Can someone enlighten me on this.