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1Repair Windows errors before they cause bigger problems2Fix the driver behind crashes, sound loss and screen glitches3Clear out junk files and repair common Windows errorsIndian technology exporters can generally claim a GST refund through one of two routes: export under a Letter of Undertaking (LUT) without paying IGST and claim eligible unutilised input tax credit (ITC), or pay IGST on the export and claim a refund of that tax where the route is available. The first step is to establish that the particular service qualifies as an export under the law; an overseas customer alone is not enough.
Check whether the technology service qualifies as an export
Under the IGST Act, an export of services must satisfy several conditions: the supplier is in India, the recipient is outside India, the place of supply is outside India, the required consideration is received in qualifying currency or permitted Indian rupees, and the supplier and recipient are not merely establishments of the same person. The Act treats qualifying exports as zero-rated supplies. Read the CBIC-hosted IGST Act, including section 16 and the export-of-services definition.
Labels such as “software export,” “SaaS,” “offshore project” or “foreign client” do not settle the test. Contract terms, the actual service, delivery arrangements, place-of-supply rules and payment facts matter. This article explains refund mechanics; it does not determine the GST treatment of a particular software licence, implementation, support, data-processing or consulting arrangement. For an unusual or mixed service arrangement, get advice from a qualified Indian GST professional.
Zero-rated does not mean compliance-free. Exporters may still need GST registration, appropriate invoicing and returns, an LUT or IGST payment, and records supporting a refund claim. CBIC’s GST FAQ states that registration is needed to claim export refunds; confirm the applicable legal requirements for your circumstances.
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Choose the refund route that applies to your business
The routes differ in what is paid on the export invoice and what the refund claim covers. The IGST-paid route is subject to applicable restrictions and notifications, so do not assume it is available or preferable for every exporter. The rules and eligibility for each route are set out in the IGST Act and CBIC GST Refund Rules.
| Route | What happens on export | What the refund claim covers | Key consideration |
|---|---|---|---|
| LUT or bond, without IGST | Export the qualifying supply without paying IGST, after furnishing the required bond or LUT. | Eligible unutilised ITC, limited by the refund formula in the rules. | Avoids paying IGST on the export invoice, but credits may remain tied up while a claim is prepared and processed. The amount is not automatically equal to the full credit balance. |
| Export on payment of IGST | Pay IGST on the zero-rated supply. | Refund of the IGST paid, under the applicable procedure. | Check current restrictions and your eligibility before selecting this route; it involves paying tax before seeking its refund. |
The cash-flow differences in the table follow from the structure of the statutory routes; they are not a promise about refund processing times. The official sources cited here do not establish a general approval rate or average processing time.
For the LUT route, furnish RFD-11 before export
A registered person choosing to export without payment of IGST must furnish a bond or LUT in FORM GST RFD-11 to the jurisdictional Commissioner before export. Rule 96A sets out this requirement and the consequences if its conditions are not met; see the CBIC CGST Rules, Rule 96A (24 September 2021 consolidation).
For exported services, Rule 96A addresses the case where payment is not received in convertible foreign exchange, or in Indian rupees where the Reserve Bank of India permits, within one year from the export invoice date. It provides for payment of tax and applicable interest within 15 days after that one-year period, unless the Commissioner allows a further period. Treat this as a compliance deadline to monitor, not as a blanket statement that any late customer payment automatically invalidates export status. The services-export definition and the LUT rule address related but distinct matters: read the qualifying consideration condition in the Act alongside Rule 96A.
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The export invoice endorsement must match whether the supply is made with or without payment of IGST. The CBIC GST Invoice Rules specify these endorsements:
- For export on payment of IGST: “SUPPLY MEANT FOR EXPORT ON PAYMENT OF IGST”.
- For export under bond or LUT without payment of IGST: “SUPPLY MEANT FOR EXPORT UNDER BOND OR LETTER OF UNDERTAKING WITHOUT PAYMENT OF IGST”.
Use the endorsement that reflects the transaction and route actually followed; do not treat invoice wording as a substitute for satisfying the export conditions or filing requirements.
Prepare the records and file the refund application
Refund applications are normally made electronically in FORM GST RFD-01 under the refund rules. Before filing, reconcile the records for the claim period so invoices, returns, ITC figures, receipts and service completion details agree. The evidence required depends on the claim category and the current rules and portal process; consult the CBIC GST Refund Rules for the documentary framework.
- Confirm registration and export eligibility. Review the supplier and recipient locations, place of supply, payment terms and relationship between the parties for the specific service arrangement.
- Choose the route. Check applicable law, restrictions, the business’s available ITC and cash-flow position before opting for IGST payment or an LUT claim.
- Complete the LUT step if applicable. Furnish FORM GST RFD-11 before export and set up a process to track service invoices and payment receipts against Rule 96A’s timeline.
- Check invoices and returns. Confirm the export endorsement, invoice details and outward-supply return reporting align with the route used.
- Reconcile the claim evidence. Match export invoices and receipts to the relevant period; verify eligible ITC and, for services, the completion and payment calculations used to determine turnover.
- Submit FORM GST RFD-01 electronically. Provide the documents applicable to the claim category and respond to any deficiency or verification request through the prescribed process.
The goods-export process is not a substitute for the services process: the refund rules require an export manifest or export report before a goods refund application. A technology service exporter should not assume that this goods-specific step applies to a service claim. See the CBIC refund rules on filing and export-manifest requirements.
Understand the unutilised-ITC refund formula
For the LUT route, the maximum refund of unutilised ITC is calculated under the rules as:
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(Turnover of zero-rated supply of goods + turnover of zero-rated supply of services) × Net ITC ÷ Adjusted Total Turnover
The rule-defined meanings of “Net ITC,” “Adjusted Total Turnover” and the relevant period matter; do not substitute the balance shown in the electronic credit ledger for the formula. For zero-rated services, the turnover calculation generally adds payments received during the relevant period for qualifying zero-rated services and amounts for services completed in that period but paid for in an earlier period. It subtracts advances received for services not completed during the relevant period. The result is a formula-based maximum, not a promise that all accumulated credits will be refunded. The CBIC Refund Rules contain the operative definitions and calculation.
Work out the filing deadline from the relevant date
The CGST Act generally sets a two-year period for a refund application from the applicable “relevant date.” Do not assume one universal export date starts that period: the Act’s definition varies by refund type and, for service exports, distinguishes cases where the service is completed before payment from cases where payment is received before completion. Determine the statutory relevant date for the particular claim before calculating a deadline. Consult section 54 and the relevant-date definition in the CBIC-hosted CGST Act and confirm whether later amendments affect the claim.
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Check the rules and portal process before filing
The CBIC-hosted Act text and the Rule 96A PDF cited here are official sources, but the cited rules PDF is a 24 September 2021 consolidation. Amendments, notifications and portal instructions may affect a later claim. Confirm the current requirements for the relevant tax period and transaction before exporting or submitting RFD-01; where classification or place of supply is uncertain, obtain case-specific professional advice.
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