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Export Refund Processing through GSTR-1 Table 6A

This article outlines the process for claiming GST refunds on exports, a critical aspect for businesses engaged in international trade. It details the definition of exports under GST, the applicable taxes and duties, and the benefits available to exporters. A step-by-step guide is provided for filing Table 6A of GSTR-1, an essential step in the refund procedure, along with key timelines for submission.

📖 3 min read read🏷️ Export Refund

In India's Goods and Services Tax (GST) framework, exports are treated as zero-rated supplies, offering specific benefits similar to customs law. Taxpayers engaged in exports must report these details in Table 6A of GSTR-1.

Recent Regulatory Changes

February 1, 2022 Update: Significant changes from Budget 2022 impact GSTR-1 amendments. The deadline for making corrections in GSTR-1, including uploading missed invoices or debit/credit notes for a financial year, is now November 30 of the following year or the filing date of the annual return, whichever is earlier. Furthermore, amendments now mandate the sequential filing of outward supply details for each tax period.

Understanding Exports Under GST

The term "export of goods" under GST refers to moving goods from India to a location outside the country. Customs law primarily governs the regulations and procedures for these exports.

For services, five specific conditions must be met for a transaction to qualify as an "export of services" under Indian GST law:

  • The service provider must be located in India.
  • The service recipient must be located outside India.
  • The place of supply must be outside India.
  • Payment must be received in convertible foreign exchange, or in Indian rupees if explicitly allowed by the Reserve Bank of India (RBI).
  • The service provider and recipient must not be considered "distinct persons" as defined by GST law. This means transactions between a head office and its branch outside India, for example, are treated as interstate supplies rather than exports, thus not qualifying for export benefits.

Taxes and Duties on Exports

Typically, exported goods are subject to certain taxes and duties, mirroring import regulations:

  • Basic Customs Duty: Applied at the relevant rate based on the goods' classification, calculated on the assessable value.
  • Social Welfare Surcharge: A 10% charge on the basic customs duty.
  • Integrated Goods and Services Tax (IGST): Charged at 18% or as otherwise notified under GST law, calculated on the sum of assessable value, basic customs duty, and social welfare surcharge, unless specifically exempted under customs or GST law.
  • Cess: If applicable, at the notified rate under GST law, calculated on the total of assessable value, basic customs duty, and social welfare surcharge.

Exported services are generally subject to IGST and, if applicable, cess. It is important to note that all exports are categorized as inter-state supplies under Indian GST law, making only IGST applicable, not Central Goods and Services Tax (CGST) or State Goods and Services Tax (SGST)/Union Territory Goods and Services Tax (UTGST).

Benefits for Exporters Under GST

Exporters can claim a refund of IGST paid on most export types. Alternatively, if exports were made without IGST payment under a Letter of Undertaking (LUT) or bond, exporters can claim a refund of the accumulated input tax credit (ITC) on raw materials or input services used for those exports.

GST Refund Process for Goods and Services Exports

Taxpayers exporting goods or services have two primary options for claiming GST refunds:

  • Refund of Accumulated Input Tax Credit: This option applies when goods or services are exported without IGST payment under a bond or LUT.
  • Refund of IGST Paid on Exports: This applies after adjusting the input tax credit, but without the cover of a bond or LUT. However, certain exclusions apply:
    • Goods subject to export duty.
    • Cases where drawback is claimed for taxes paid on export of goods or services.
    • Deemed exports, except for capital goods exported under the Export Promotion Capital Goods (EPCG) Scheme (Notification 48/2017-Central Tax, dated October 18, 2017).
    • Exporters of goods or services who paid concessional tax for intra-state purchases utilized in such exports (Notification 40/2017-Central Tax (Rate), dated October 23, 2017).
    • Exports of goods or services from designated areas like Export Oriented Units (EOU), Software Technological Parks (STP), or Hardware Technological Parks (HTP) where IGST is exempted as notified under customs law (Notifications 78/2017 and 79/2017-Customs, dated October 13, 2017).

For both options, the GST refund claim is initiated by filing details in Table 6A of GSTR-1, followed by the monthly summary return in GSTR-3B. When goods are exported with IGST payment, the export document (Bill of Export or Shipping Bill) serves as the refund application for IGST.

GST officers verify the shipping bill details from the exporter's GSTR-1 against records on the ICEGATE portal. If satisfied, the refund is credited to the taxpayer's registered bank account. Exporters of services who paid IGST must also file Form RFD-01 on the GST portal, in addition to GSTR-1 and GSTR-3B, to complete their refund claim. A crucial requirement is reporting the Bank Realisation Certificate (BRC/FIRC) number for the export invoice. An application reference number is generated upon online submission, and the GST officer processes the claim after verification.

The procedure for claiming a refund of accumulated ITC without IGST payment on exports of goods and services is largely similar. It starts with the exporter filing a Letter of Undertaking (LUT) before the exports, within specified deadlines. When declaring in Table 6A and Table 6B of GSTR-1, the exporter must enter 'zero' for tax amounts. After successful export, the accumulated ITC details are reported to the GST portal by filing Form RFD-01 to apply for the refund.

Timelines for Export GST Refund Claims

| Sl no. | Type of refund | Relevant date | |---| | 1 | Goods exported from India where tax paid refund is available: || | | a) Goods exported by sea or air | Date when the ship or aircraft carrying goods departs India || | | b) Goods exported by land | Date when goods cross the frontier || | | c) Goods exported by post | Date of goods' dispatch by the concerned Post Office to a foreign location || | 2 | Services exported from India where tax paid refund is available: || | | a) Service supply completed before payment receipt | Date of payment receipt in convertible foreign exchange || | | b) Services received in advance prior to invoice issue date | Date of invoice issue || | 3 | Refund of unutilized input tax credit on inputs for taxes not paid during goods or services export | End of the financial year in which the refund claim originates |

Guide to Completing Table 6A of GSTR-1 on the GST Portal

Step 1: Access the GST portal by logging in.

Step 2: Navigate to ‘Services’ > ‘Returns’ > ‘Return Dashboard’, then select ‘GSTR-1’.

Step 3: Choose the appropriate month for filing Table 6A of GSTR-1 and click ‘SEARCH’.

Step 4: Click on the ‘Table 6A of FORM GSTR-1’ tile.

Step 5: Initiate the return filing process by clicking ‘ADD INVOICE’.

Step 6: On the ‘Exports – Add Details’ page, input details for each invoice and click ‘SAVE’. The tile will display the count of added invoices, and taxpayers can also edit existing invoices.

  • Enter the invoice generation date in the ‘Invoice Date’ field.
  • Provide the alphanumeric six-character ‘port code’ as specified by ICEGATE.
  • The ‘Shipping Bill No./Bill of Export No.’ field requires the unique shipping bill number with its location code, generated during shipping. This number, ranging from three to fifteen numeric digits, serves as the invoice number.
  • Input the ‘Shipping bill date’ in its designated field.
  • Report the ‘total invoice value,’ representing the full amount of all goods or services supplied.
  • From the ‘GST payment’ dropdown list for each invoice, choose either ‘WPAY’ (with payment of IGST on exports) or ‘WOPAY’ (without payment of IGST on exports).
  • For the question "Is the supply eligible to be taxed at a differential percentage (%) of the existing rate of tax, as notified by the government?", either check the box to confirm or leave it blank.
  • Enter the ‘Taxable Value’ (net of GST) in its respective field.

Note: The ‘amount of tax’ fields are automatically populated based on the entered ‘Taxable Value’ and can be edited, but only appear if the export was made with tax payment.

Step 7: Complete all other relevant sections of GSTR-1 before final submission.

Step 8: Review all entered invoices under ‘Processed Invoices’. Use the edit and delete buttons under ‘Actions’ to make any necessary changes. Once verified, click ‘FILE RETURN’.

Step 9: Tick the verification checkbox, select the ‘Authorised Signatory’ from the dropdown menu, and file the return using either a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC).

Frequently Asked Questions

What is a zero-rated supply under GST?
A zero-rated supply under GST refers to goods or services exported or supplied to Special Economic Zones (SEZs). These supplies are not subject to GST, and taxpayers can claim a refund of the Input Tax Credit (ITC) paid on inputs used for such supplies.
How does GST apply to international transactions like imports and exports?
For exports, goods and services are typically zero-rated, meaning no GST is charged, and ITC can be claimed. For imports, Integrated Goods and Services Tax (IGST) is levied along with customs duties, treated similarly to an inter-state supply.
What is the role of IGST in inter-state and international transactions?
IGST (Integrated Goods and Services Tax) is charged on all inter-state supplies of goods and services. It is also applied to imports and exports (though exports are often zero-rated, IGST is technically applicable on the supply but eligible for refund or exemption under LUT/Bond). IGST ensures a seamless flow of credit across states.
Can businesses claim Input Tax Credit on all purchases related to exports?
Businesses can generally claim Input Tax Credit (ITC) on inputs, input services, and capital goods used for making taxable supplies, including zero-rated (export) supplies. However, certain specified goods or services are blocked from ITC claims under GST law.
What are the key differences between CGST, SGST, and UTGST?
CGST (Central GST) is levied by the Central Government on intra-state supplies. SGST (State GST) is levied by State Governments on intra-state supplies. UTGST (Union Territory GST) is levied by Union Territories on intra-state supplies within UTs. IGST (Integrated GST) is levied by the Central Government on inter-state supplies and imports/exports, subsuming both Central and State components.