GST for exporters: LUT, zero-rating and refunds

This guide is for GST-registered exporters of goods, and services exporters who want the basics, who need to choose how to export under GST and how to get refunds without delays. It covers the two routes, the yearly LUT, both refund processes and the mismatches that hold refunds up.

Zero-rating: the two routes

Under section 16 of the IGST Act, exports are "zero-rated supplies". You can still claim input tax credit (ITC) on what you buy, and you can choose one of two routes:

	Route 1: export under LUT	Route 2: pay IGST and claim refund
Tax at export	None; invoice is marked as supply for export under LUT without payment of IGST	IGST charged on the export invoice and paid in GSTR-3B, usually from ITC
What you get back	Unused ITC	The IGST paid
How you claim	Form GST RFD-01 on the GST portal	Goods: automatic, as the shipping bill is treated as the refund claim and customs pays it. Services: RFD-01
Typical user	Most exporters of goods and services	Goods exporters with large ITC balances who want automated refunds through customs

A few notified goods, such as pan masala, certain tobacco products and mentha oil, do not get the automated IGST refund through customs under Notification 01/2023-Integrated Tax. If you export these, check the notification with your adviser before you choose a route.

Filing your LUT (form RFD-11)

An LUT lasts for one financial year, so you file a fresh one for each year, ideally in March or early April before your first export of the year. Any registered person can use an LUT unless they have been prosecuted for tax evasion above the limit set in the CBIC notification on LUTs.

1. Log in to the GST portal and go to Services, User Services, Furnish Letter of Undertaking (LUT).
2. Select the financial year, tick the declarations and enter the details of two witnesses.
3. Sign with your DSC or EVC and submit. Keep the acknowledgement (ARN); the LUT is generally treated as accepted when it is acknowledged.

The LUT has conditions under rule 96A of the CGST Rules. If goods are not exported within three months of the invoice date (or a longer period the Commissioner allows), or payment for services is not received within one year or the period allowed under FEMA, whichever is later, you must pay the IGST with interest within 15 days.

Route 1: claiming an ITC refund in RFD-01

1. Report export invoices correctly in GSTR-1 (table 6A for goods, with shipping bill number, date and port code) and file GSTR-3B.
2. File RFD-01 on the GST portal under the category for export without payment of tax, for one or more tax periods.
3. Attach statement 3 with invoice-wise details: shipping bill and export general manifest details for goods, and bank realisation certificates or foreign inward remittance certificates for services.
4. The refund is worked out by formula under rule 89(4): turnover of zero-rated supplies multiplied by net ITC, divided by adjusted total turnover.

The time limit is two years from the relevant date. For goods that is the date the ship or aircraft leaves India; for services it is generally the date you receive payment, or the invoice date if you were paid in advance. Section 54(6) of the CGST Act allows provisional refund of 90% of a zero-rated claim, and since October 2025 CBIC has told officers to sanction it on the basis of a system risk score (Instruction 06/2025-GST). The refund goes to the bank account on your GST registration.

If export proceeds are not realised within the period FEMA allows, rule 96B requires you to pay the refund back unless RBI rules let the amount be extended or written off.

Route 2: IGST refund through customs

You do not file a separate application. Under rule 96, the shipping bill is treated as your refund claim once the export general manifest (EGM) has been filed and you have filed GSTR-3B. GST sends your GSTR-1 table 6A data to customs, which matches it with the shipping bill and pays the refund into the bank account registered on ICEGATE and validated by PFMS. You can track the status on ICEGATE.

Rule 96(10), which stopped some exporters using imported duty-free inputs from taking this route, was omitted from 8 October 2024. Refunds of IGST below ₹1,000 per shipping bill are not paid at present. The Finance Act, 2026 removes that floor, but only from a date still to be notified.

Common mismatches and fixes

Error on ICEGATE	What it means	Fix
SB001 / SB005	Invoice details or number in GSTR-1 do not match the shipping bill	Amend through table 9A of GSTR-1, or ask the customs IGST refund cell for correction with a concordance of invoice numbers
SB002 / SB006	EGM, or gateway EGM for ICD cargo, not filed	Ask the shipping line or your customs broker to file it
SB003	GSTIN on the shipping bill differs from GST returns	Correct the return; make sure the GSTIN is on your IEC profile
Validated but not paid	LUT used, higher drawback rate claimed, PFMS account failure or IEC alert	Check the scroll status on ICEGATE and fix the bank account

Watch out for

• Using one invoice number for GST and another for customs. Use the same number on both.
• Showing the IGST in GSTR-3B under the wrong table, so customs sees less tax paid than claimed.
• Exporting in a new year before the new LUT is filed.
• Missing the two-year limit for RFD-01 because claims were left to the year end.

Related on Exportsmitra

• Policies and licences tracker with GST LUT reminders (members)
• AD code and ICEGATE: what customs needs before your first shipping bill
• Export customs clearance: from shipping bill to let export order
• Exporting services from India: GST, payments and paperwork

Sources

• Goods and Services Tax Network: GST portal (LUT, RFD-01)
• CBIC: GST Acts, rules, notifications and circulars
• Chennai Customs: IGST refund error codes and remedies
• CBIC: ICEGATE (IGST refund status)
• CBIC Instruction 06/2025-GST on risk-based provisional refunds (text reproduced by TaxHeal)
• Lakshmikumaran & Sridharan: omission of rule 96(10)
• Summary of GST changes in the Finance Act, 2026 (secondary source)

Last checked 1 October 2026. Rules change: confirm with your GST practitioner or jurisdictional GST officer before you act.