GST Refund: Export Without Payment of Tax (LUT)

What This Refund Covers

When you export goods or services under a valid Letter of Undertaking (LUT), the supply is zero-rated and you don't charge or pay IGST on it. But you still pay GST on your inputs and input services — raw materials, packaging, rent, professional fees, and so on. Since there's no output tax to set that credit off against, it accumulates in your electronic credit ledger month after month.

This refund category lets you claim that accumulated, unutilised ITC back in cash, calculated under Rule 89(4): Turnover of zero-rated supply × Net ITC ÷ Adjusted Total Turnover, capped at your actual Net ITC for the period. It's the most common refund route for exporters who prefer not to fund IGST payments upfront on every shipment.

Statement 3Annexure filed with RFD-01

2 YrsFrom export date (goods) or payment receipt (services)

90%Provisional refund within 7 days*

*Subject to risk-based verification under Rule 91. See the full relevant date table for exact rules by export mode.

Be Prepared

Documents Required

Valid LUT (Form RFD-11)

Filed for the financial year in which the export happened — this is the precondition for the entire zero-rated-without-tax route.

Statement 3

Invoice-wise details of the zero-rated supply, filed as an annexure with Form RFD-01.

Shipping Bill / Bill of Export

For export of goods — matched against Customs' EGM data for that shipment.

BRC / FIRC

For export of services — proof of receipt of payment in convertible foreign exchange.

GSTR-1 & GSTR-3B Copies

Filed returns for the relevant period(s) — the zero-rated turnover and ITC figures must reconcile with these.

CA Certificate / Self-Declaration

Rule 89(2) declaration on unjust enrichment — self-declaration under ₹2 lakh, CA/CMA certificate above it.

Avoid the Common Traps

Why This Claim Gets Rejected

Expired or Missing LUT

Exporting without a valid LUT on file for that financial year invalidates the without-payment route entirely.

Shipping Bill / EGM Mismatch

Customs' Export General Manifest doesn't reflect the shipping bill details declared in GSTR-1.

Turnover Figures Don't Reconcile

Zero-rated turnover or Net ITC claimed in the refund statement doesn't match what was filed in GSTR-3B.

FAQs

Do I need to pay IGST if I have a valid LUT?

No. A valid Letter of Undertaking lets you export goods or services without paying IGST at all. You still accumulate input tax credit on your purchases, which you then claim back as a refund since there's no output tax to offset it against.

What happens if my LUT expires before I export?

An LUT is valid for one financial year and must be renewed (filed fresh) before the first export of the new year. If you export without a valid LUT on file, you're expected to pay IGST on that shipment and claim it back under the "export with payment of tax" route instead.

Is this refund route slower than paying IGST upfront?

Generally yes for goods — the "export with IGST paid" route is largely automated via the shipping bill and Customs data, while the LUT/ITC route requires filing Form RFD-01 with supporting statements and goes through manual scrutiny, though provisional refund of 90% is still available within 7 days.

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