Guide to GST Refund Procedures, Eligibility, and Timelines in India

The Goods and Services Tax (GST) framework in India includes a crucial refund mechanism allowing taxpayers to reclaim excess taxes or accumulated Input Tax Credits (ITC). Refunds can arise from various situations, such as exports, an inverted duty structure, or surplus amounts in the electronic cash ledger. Since the specific GST refund forms vary based on the claim type, businesses must thoroughly understand the process. This article provides a detailed, step-by-step guide for applying for different categories of GST refunds.

Recent Updates on GST Refund Processes

August 28, 2025: GSTN has released an advisory clarifying system modifications for processing refunds related to assessment, enforcement, appeal, revision, or other orders (ASSORD). Key changes include allowing refund claims regardless of Demand ID status (only if the demand amount is negative), enabling claims even with a negative minor head balance (if the cumulative balance is positive or zero), auto-populating only negative balances into RFD-01 applications, and automatically suggesting the most recent negative balance demand order.

June 12, 2025: According to a recent GSTN advisory, the GST portal now validates refund applications from Quarterly Return and Monthly Payment of taxes (QRMP) taxpayers based on invoices reported in the Invoice Furnishing Facility (IFF) for the first two months of a quarter. Previously, these taxpayers encountered issues with the portal flagging non-filing of returns. CGST Circular No. 125/44/2019-GST dated November 18, 2019, advises taxpayers to file refund claims only after submitting GSTR-1 and GSTR-3B (or CMP-08/GSTR-4 for composition persons, GSTR-5 for non-residents, GSTR-4 for input service distributors) that are due before the refund application.

May 8, 2025: A new GSTN advisory details changes to the refund filing process for export of services with tax payment, supplies to SEZ units/developers with tax payment, and deemed exports. Refund applications can now be filed without specifying a tax period. Instead, applicants select the refund category, provide invoice-based details, and upload eligible invoices along with relevant statements (2 for exports, 4 for SEZ supplies, and 5B for deemed exports). It is essential to ensure that GSTR-1 and GSTR-3B have been filed up to the date of the refund application. Similar changes apply to refunds claimed by recipients of deemed exports.

Eligibility for a GST Refund

Several categories of taxpayers are eligible to claim GST refunds:

Exporters of goods and services
Suppliers making zero-rated supplies without tax payment
Taxpayers operating under an inverted duty structure
Individuals or entities who have mistakenly paid excess taxes
Recipients of advance payments for services or goods not yet provided
Taxpayers possessing an excess balance in their electronic cash ledger.

Essential Documents for GST Refund Claims

To process a GST refund, applicants typically need to submit the following documents:

The official GST refund application form, RFD-01.
Tax invoices pertinent to the refund claim.
Proof of tax payment, such as challans.
Export-related documentation, including shipping bills or Letters of Undertaking (LUT).
Details of the bank account where the refund will be credited.
Any additional supporting documents as required by the specific refund type.

Deadline for Submitting GST Refund Applications

Refund claims must be filed within two years from the relevant date. Specific relevant dates for various refund scenarios are outlined in Section 54 of the CGST Act.

Steps for Submitting the GST Refund Pre-application Form

Before initiating any specific GST refund claim, taxpayers must complete a pre-application form, which gathers information about their business, Aadhaar number, income tax specifics, export data, expenditure, and investments. This form does not require a signature and cannot be modified after submission, so accuracy is paramount.

The process involves two main steps:

Step 1: Access the GST portal, navigate to the 'Services' tab, select 'Refunds', and then choose the 'Refund pre-application form' option.
Step 2: On the 'Refund pre-application form' page, fill in all requested details and click 'Submit'. A submission confirmation will appear.

Required details include:

Nature of business: Manufacturer, merchant exporter, trader, or service provider.
Date of IEC issuance (for exporters only): Required for refunds related to exports without tax payment.
Aadhaar number: Mandatory for the primary authorized signatory.
Value of exports in FY 2019-2020 (for exporters only): Calculated at the GSTIN level.
Income tax paid in FY 2018-2019.
Advance tax paid in FY 2019-2020.
Capital expenditure and investments made in FY 2018-2019.

Refund Process for IGST Paid on Export of Goods (with Tax Payment)

Exports are categorized as 'Zero-rated supplies' under GST, making any IGST and cess paid eligible for a refund to the exporter. Given the potentially large volume of transactions, the GST portal streamlines this refund process, eliminating the need for a separate RFD-01 application. However, exporters must fulfill specific conditions.

Firstly, Table 6A in GSTR-1 must be accurately completed with shipping bill details for export transactions (where tax was paid) and filed by the due date. Secondly, a summary of these details must be reported in item 3.1(b) of GSTR-3B. Furthermore, the corresponding tax must be paid, and the return filed within the GST law's prescribed deadlines.

It is crucial to provide the complete shipping bill number, shipping bill date, and port code in the export invoice data within Table 6A of Form GSTR-1. Export transactions from a given tax period must be reported in the GSTR-1 and GSTR-3B for that same period. Additionally, the total IGST and cess declared in Table 3.1 of GSTR-3B must be equal to or greater than the amounts in Table 6A and Table 6B of GSTR-1.

The GST authority considers the shipping bill itself as the refund application in such cases. The GST portal transmits export details from GSTR-1 to the ICEGATE system. A confirmation of GSTR-3B filing for the relevant tax period is also sent. The Customs system cross-references the GSTR-1 information with its shipping bill and Export General Manifest (EGM) data to process the refund. Once the refund payment is credited to the taxpayer's account, ICEGATE shares payment information with the GST portal, which then notifies the taxpayer via SMS and email.

Applying for Different GST Refund Types Using Form RFD-01

Form RFD-01 is used for various GST refund claims, including:

Excess cash balance in the electronic cash ledger or overpayment of tax.
IGST paid on export of services (with tax payment).
Accumulated Input Tax Credit (ITC) from exports of goods and services without tax payment.
Accumulated ITC from supplies made to SEZ units/developers without tax payment.
ITC accumulated due to an inverted tax structure (where input tax rates exceed output tax rates).
Refunds claimed by recipients of deemed exports.
Tax paid on supplies to SEZ units/developers (with tax payment).
Tax paid on an intrastate supply later reclassified as an interstate supply, or vice versa.
Refunds claimed by suppliers of deemed exports who paid tax without charging the buyer (with a declaration that the buyer will not claim a refund).
Refunds resulting from assessment, provisional assessment, appeal, or other orders.
Refunds based on 'Any other ground' using RFD-01.
Refund claims by unregistered taxpayers.

Taxpayers must ensure accurate invoice information in GSTR-1 and RFD-01. In specific scenarios, a certificate from a chartered accountant or cost accountant is required.

To file a refund application in RFD-01, follow these steps:

Step 1: Log in to the GST portal, go to the ‘Services’ tab, click on ‘Refunds’, and select the ‘Application of refund’ option.
Step 2: On the subsequent page, choose the reason or type of refund and click ‘Create refund application’.
Step 3: Specify the period for which the refund is being applied and indicate whether you intend to file a nil refund application. If filing a nil refund, check the declaration and proceed with filing using either DSC or EVC. This step is not applicable for refunds like excess cash balance in the ledger, reclassified intrastate/interstate supplies, or assessment-related orders.
Step 4: Based on the chosen refund type, fill in the relevant details on the displayed page.

Type 1: Excess Cash Balance in Electronic Cash Ledger

Enter the precise amount of cash to be claimed as a refund.

Type 2: Excess Tax Paid Through GSTR-3B

Provide details of the GSTR-3B filing where the excess tax payment was made in cash.

Type 3: Accumulated ITC Due to Exports of Goods and Services Without Tax Payment

a. Download Statement 3 and input details of all export invoice documents related to the refund claim. b. Generate the JSON file, upload it to the GST portal, and validate for any errors. c. In the 'Computation of Refund to be claimed Statement-3A [rule 89(4)]' section, input the aggregate turnover, adjusted total turnover, and net input tax credit. d. The system performs validations to calculate the maximum eligible refund amount.

Type 4: Accumulated ITC Due to Supplies Made to SEZ Unit/SEZ Developer (Without Tax Payment)

A prerequisite is that GSTR-1 and GSTR-3B for the selected period must be filed. The steps are identical to Type 3 refunds, but Statement 5 is used, and a CSV file can be uploaded instead of JSON.

Type 5: ITC Accumulated Due to Inverted Tax Structure

An inverted tax structure exists when the tax rate on inputs is higher than on outputs. The application steps mirror Type 3 refunds, but Statement 1A is utilized. Subsequently, details such as turnover of inverted rated supply, tax payable, adjusted total turnover, and net input tax credit must be entered.

Type 6: Refund by the Recipient of Deemed Exports

If a recipient of deemed exports has paid tax on eligible inward supplies and claimed ITC in their electronic credit ledger, they are entitled to a refund of that tax amount. However, the supplier of these deemed exports must forgo any refund claim. The process follows Type 3 refunds, but Statement 5B is used, and details like net input tax credit of deemed exports and the claimed refund amount are entered.

Type 7: Tax Paid on Supplies Made to SEZ Unit/SEZ Developer (With Tax Payment)

The steps are the same as for Type 3 refunds, but Statement 4 is used. The refund amount will be automatically populated once the statement is uploaded.

Type 8: Tax Paid on an Intrastate Supply Later Held as Interstate Supply and Vice Versa

The steps mirror Type 3 refunds, but Statement 6 is used. The refund amount will be automatically populated after the statement is uploaded.

Type 9: Refund by the Supplier of Deemed Exports

This process is similar to Type 3 refunds, using Statement 5B. The refund amount will be auto-populated upon statement upload.

Type 10: Refund of IGST Paid on Export of Services (With Tax Payment)

Following the steps for Type 3 refunds, Statement 2 is used. The refund amount will automatically populate once the statement is uploaded.

Type 11: On Account of Assessment, Provisional Assessment, Appeal, or Any Other Order

Select the specific type of order and input its details accordingly.

Type 12: Refund on 'Any Other Ground'

This category covers reasons such as excess interest paid via GSTR-3B. Applicants must specifically state the refund reason (within 200 characters) along with the amount.

Step 5: Enter the bank account details for the refund, upload any necessary supporting documents, and provide declarations as required for specific refund types. Up to 10 supporting documents, each limited to 5 MB, can be uploaded. Preview the application and click 'Save'. Saved applications remain accessible for 15 days. After reviewing, check the undertaking and self-declaration boxes and click 'Proceed'.

Step 6: File the RFD-01 form using either an Electronic Verification Code (EVC) or a Digital Signature Certificate (DSC).

Upon successful submission, an Application Reference Number (ARN) will be generated and displayed, also sent via email and mobile SMS. This ARN can be used to track the application's status. The application is then assigned to a refund processing officer, who will verify and scrutinize it, updating the refund status as it progresses.

Refund Claim by Unregistered Persons

Unregistered individuals seeking a GST refund must first obtain GST registration. Subsequently, they can apply for a refund using RFD-01, Statement 8, a supplier certificate, and other supporting documents. A detailed process guide for unregistered persons is available here.

GST Refund Process for Embassies and International Organisations

Embassies and international organizations can claim refunds through two methods:

Method 1: Use GSTR-11 to generate a refund application in Form RFD-10. This involves selecting the tax period/quarter for the already filed GSTR-11 and clicking 'Generate RFD-10'. Choose the embassy or organization radio button and click 'Create'. The tax paid on purchases, as reported in GSTR-11, will auto-populate, with editing options available.
Method 2: Obtain Form RFD-10 directly from the dashboard after logging into the GST portal. Navigate to the services tab, select refunds, and choose 'Application for refund'. On the displayed page, select 'Embassy/International Organisation' and click 'Create'. The details of tax paid eligible for refund will auto-populate from the filed GSTR-11.

In both methods, applicants will then verify, edit, or enter the refund amount, preview the application, and submit it using a DSC or EVC.

What Happens After the GST Refund Application is Submitted?

Once a refund application is filed, it appears on the tax officer's dashboard as a pending item. The officer will verify and scrutinize the application and its accompanying documents. The status of filed applications can be tracked via the 'Track Application Status' feature under 'Refunds'. After inspection by GST authorities, the approved refund amount will be credited to the applicant's bank account.

The officer's potential actions include:

Provisional Refund: For certain refund types, a provisional refund can be granted in Form RFD-04, to be issued within seven days of the acknowledgment date, covering at least 90% of the claimed amount.
Acknowledgement: An acknowledgment in Form RFD-02 is issued within 15 days if the application is complete.
Application Withdrawal: The applicant can withdraw the application in Form RFD-01W. Upon withdrawal, any debited amount from the taxpayer's electronic credit or cash ledger will be re-credited.
Deficiency Memo: If deficiencies are found, the officer may issue a deficiency memo in Form RFD-03 within the same timeframe, requiring the applicant to rectify them. In such cases, the claimed refund amount is automatically re-credited to the electronic cash/credit ledger, and a new application must be filed.
Clarification Notice: A notice to seek clarification (Form RFD-08) may be issued for application rejection or recovery of a mistakenly granted refund. The applicant must respond within 15 days using Form RFD-09.
Sanction/Rejection Order: The officer will issue a sanction or rejection order in Form RFD-06. If sanctioned, a payment order in Form RFD-05 follows (sometimes after RFD-04).
Withholding Refund: In some instances, the officer may issue an order to withhold a sanctioned refund in Form RFD-07 (Part-B), meaning RFD-05 is not issued.
Re-credit Order: An order to re-credit the refund to the taxpayer's electronic cash or credit ledger in cases of rejection or provisional refund (Form PMT-03).