Navigating the GST Refund System: Eligibility, Procedures, and Tracking

Under the Goods and Services Tax (GST) framework, taxpayers can claim refunds for overpaid taxes or unused Input Tax Credits (ITC). Various situations, including exports, inverted duty structures, or surplus balances in the electronic cash ledger, may necessitate a refund. Since the specific GST refund forms differ based on the claim type, understanding the comprehensive refund procedure is crucial for businesses. This article outlines the step-by-step application process for various GST refund categories.

Recent Updates on GST Refund Procedures

August 28, 2025: The GSTN has released an advisory clarifying system modifications for refunds stemming from assessment, enforcement, appeal, revision, or other orders (ASSORD). Key changes include:

Refunds can now be claimed irrespective of the Demand ID status, provided the demand amount is negative.
Taxpayers may claim refunds even if a minor head shows a negative balance, as long as the cumulative balance is positive or zero.
Only negative balances are automatically populated into RFD-01 refund applications.
The GST portal now suggests the most recent negative-balance-related demand order, such as an original order, rectification, or appellate order.

June 12, 2025: According to a recent GSTN advisory, the GSTN has implemented a validation on the GST portal. This allows Quarterly Return and Monthly Payment of taxes (QRMP) taxpayers to submit refund applications based on invoices reported in the Invoice Furnishing Facility (IFF) for the initial two months of a quarter. Previously, these taxpayers encountered portal issues flagging non-filing of returns for these months, despite not being legally obligated to file.

Currently, 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, which are due on or before the refund application date. Similarly, composition taxable persons must have filed CMP-08 or GSTR-4, non-resident taxable persons GSTR-5, and input service distributors GSTR-4, if due, before initiating refund claims.

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.

Going forward, refund applications can be filed without specifying a tax period.
Instead, applicants select the refund category and provide invoice-based details, uploading eligible invoices and relevant statements (Statement 2 for exports, Statement 4 for SEZ supplies, and Statement 5B for deemed exports).
It is essential to ensure that GSTR-1 and GSTR-3B up to the date of the refund application have been filed. Identical changes apply to refunds claimed by recipients of deemed exports.

Eligibility for GST Refunds

Individuals and entities eligible for GST refunds include:

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

Required Documents for GST Refund Applications

To claim a GST refund, the following documents are typically needed:

GST refund application form RFD-01.
Tax invoices pertinent to the refund claim.
Proof of tax payments, such as challans.
Export-related documents, including shipping bills or Letters of Undertaking (LUTs).
Bank account details for receiving the credited refund.
Any additional documents as mandated by specific refund cases.

Time Limits for Claiming GST Refunds

Taxpayers must submit refund claims within two years from the "relevant date." For specific relevant dates pertaining to various refund scenarios, refer to this guidance.

Steps to Submit the GST Refund Pre-Application Form

The refund pre-application form collects essential information about a taxpayer's business, including Aadhaar details, income tax information, export data, expenditures, and investments. This form is mandatory for all types of GST refunds and, once submitted, cannot be edited or signed. Therefore, careful data entry is crucial.

The process involves two main steps:

Step 1: Accessing the Form Log in to the GST portal, navigate to the 'Services' tab, click on 'Refunds', and then select the 'Refund pre-application form' option.

Step 2: Filling and Submitting Details On the 'Refund pre-application form' page, complete all requested details and click 'Submit'. A confirmation message will appear upon successful submission.

The required details include:

Nature of business: Specify if you are a manufacturer, merchant exporter, trader, or service provider.
Date of IEC issue (for exporters only): Mandatory for those claiming refunds on exports without tax payment.
Aadhaar number of the primary authorized signatory: This is a compulsory field.
Value of exports in FY 2019-2020 (for exporters only): Calculated at the GSTIN level, not the PAN level.
Income tax paid in FY 2018-2019.
Advance tax paid in FY 2019-2020.
Capital expenditure and investments made in FY 2018-2019.

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

Exports are classified as 'Zero-rated supplies' under GST, making the Integrated Goods and Services Tax (IGST) and any applicable cess paid on them eligible for a refund to the exporter. The GST portal streamlines this process for exporters, eliminating the need for a separate RFD-01 application, provided certain conditions are met.

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

In the export invoice data submitted under Table 6A of Form GSTR-1, it is essential to provide the complete shipping bill number, shipping bill date, and port code. Export transactions occurring within a tax period must be declared in both GSTR-1 and GSTR-3B for that same period. Furthermore, the total IGST and cess reported 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 as the refund application in this context. The GST portal transmits export details, as declared in GSTR-1, to ICEGATE. Concurrently, a confirmation of GSTR-3B filing for the relevant tax period is sent. The Customs system cross-references the GSTR-1 information with its shipping bill and Export General Manifest (EGM) data, then proceeds with the refund.

Upon the refund payment being credited to the taxpayer's account, the ICEGATE system shares this payment information with the GST portal, which then notifies taxpayers via SMS and email.

Applying for Different GST Refund Types Using Form RFD-01

Form RFD-01 is required for the following GST refund claims:

Excess cash balance in the electronic cash ledger or overpayment of tax.
IGST paid on the export of services (with tax payment).
Accumulated ITC due to exports of goods and services without tax payment.
Accumulated ITC from supplies made to SEZ units/developers without tax payment.
ITC accumulation resulting from an inverted tax structure (where input tax is higher than output tax).
Refunds received by the recipient of deemed exports.
Tax paid on supplies to SEZ units/developers (with tax payment).
Tax initially paid on an intrastate supply, later reclassified as an interstate supply, or vice versa.
Refund claims by suppliers of deemed exports who paid tax without charging the buyer (contingent on the recipient not claiming a refund).
Refunds arising from assessment, provisional assessment, appeal, or any other official order.
Refunds based on 'any other ground' using RFD-01.
Refund claims submitted by unregistered taxpayers.

Taxpayers must accurately declare invoice information in both GSTR-1 and RFD-01. In specific cases, a certificate from a chartered accountant or cost accountant may be necessary.

Follow these steps to file a refund application in RFD-01:

Step 1: Accessing the Refund Application Log in to the GST portal, go to the 'Services' tab, click on 'Refunds', and select 'Application for refund'.

Step 2: Selecting Refund Type On the subsequent page, choose the reason or type of refund you are claiming and click 'Create refund application'.

Step 3: Specifying Refund Period Select the period for which the refund is being applied. Then, answer 'Yes' or 'No' to the 'If you want to file a nil refund' prompt. For a nil refund application, check the declaration box and proceed to file using either DSC or EVC. This step is not applicable for refunds related to excess cash balance, intrastate/interstate reclassification, or assessment/appeal orders.

Step 4: Entering Specific Details for Each Refund Type Enter the required details on the relevant page, which will vary based on the refund type selected in the previous step.

Type 1: Excess Cash Balance in Electronic Cash Ledger

Provide the exact amount of cash being claimed as a refund.

Type 2: Excess Tax Paid Through GSTR-3B

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

Type 3: Accumulated ITC from Exports of Goods and Services (without Tax Payment)

Download Statement 3 and input the details of export invoice documents relevant to the refund claim.
Generate and upload the JSON file to the GST portal, then validate any detected errors.
Under the 'Computation of Refund to be claimed Statement-3A [rule 89(4)]' section, enter the aggregate turnover, adjusted total turnover, and net input tax credit.
The system performs validations to calculate the maximum eligible refund amount.

Type 4: Accumulated ITC from Supplies to SEZ Unit/SEZ Developer (without Tax Payment)

A prerequisite for this type of refund is that GSTR-1 and GSTR-3B for the chosen period must be filed. The application steps mirror those for 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 occurs when the tax rate and amount paid on inputs are higher than those on outputs. The application process is identical to 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 are entered.

Type 6: Refund by the Recipient of Deemed Exports

If a recipient of deemed exports has paid tax on inward supplies qualifying as deemed exports and has claimed ITC in their electronic credit ledger, they are eligible for a refund of the tax amount paid. Importantly, the supplier of these deemed exports must not claim a similar refund. The application procedure is the same as for Type 3 refunds, using Statement 5B. Details such as net input tax credit for deemed exports and the total refund to be claimed are then provided.

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

The steps for this refund type are consistent with Type 3 applications, with the key difference being the use of Statement 4. The refund amount will automatically populate based on the uploaded statement.

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

This refund type follows the same application steps as Type 3, but requires Statement 6. The refund amount will be auto-populated from the uploaded statement.

Type 9: Refund by the Supplier of Deemed Exports

The procedure for this refund is similar to Type 3, utilizing Statement 5B. The refund amount will be automatically populated from the uploaded statement.

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

For this refund category, the application steps are consistent with Type 3, but Statement 2 is used. The refund amount will be automatically populated based on the uploaded statement.

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

Select the specific order type and input its details as prompted by the system.

Type 12: Refund on

Any Other Ground

This category accommodates reasons such as excess interest paid via GSTR-3B. Clearly state the specific reason for the refund within 200 characters, along with the corresponding amount.

Step 5: Finalizing the Application

Enter your bank account details for the refund. Upload any necessary supporting documents and declarations, particularly in cases where they are mandated. Up to 10 documents, each with a maximum file size of 5 MB, can be attached. Preview the application, click 'Save' (the saved application remains accessible for 15 days), and then check the undertaking and self-declaration boxes before clicking 'Proceed'.

Step 6: Filing RFD-01

Submit RFD-01 using either an Electronic Verification Code (EVC) or a Digital Signature Certificate (DSC). An Application Reference Number (ARN) will be generated and displayed on screen, also sent to your registered email and mobile number. This ARN can be used to track the application's progress.

The refund application is subsequently assigned to a refund processing officer, who will review and scrutinize it along with the submitted documents. The refund status will be updated accordingly.

Refund Claim for Unregistered Persons

Unregistered individuals seeking a GST refund must first obtain GST registration. Following registration, they can apply for a refund using form RFD-01, along with Statement 8, a supplier certificate, and any other required supporting documents. A detailed process can be found here.

GST Refund Process for Embassies and International Organizations

Embassies and international organizations can claim refunds through two methods:

Using GSTR-11: Generate a refund application in form RFD-10 by selecting the relevant tax period/quarter and clicking the 'Generate RFD-10' button. Then, choose the embassy or organization option and click 'Create'. The 'Details of the tax paid on purchases as reported under GSTR-11' table will auto-populate with amounts from the return, which can also be edited. Finally, preview and submit using DSC or EVC.
Via the GST Portal Dashboard: After logging into the GST portal, go to the 'Services' tab, select 'Refunds', and then 'Application for refund'. On the displayed page, select 'Embassy/International Organisation' and click 'Create'. The tax paid details eligible for refund will auto-populate from the already filed GSTR-11. Verify, edit, or enter the refund amount. The remaining steps are identical to the first method.

Post-Application: What Happens After a GST Refund is Applied?

Once a refund application is filed, it appears on the tax officer's dashboard as a pending item. The officer verifies and scrutinizes the application and its accompanying documents. Filed applications can be tracked via the "Track Application Status" option under the 'Refunds' section. After the GST authorities complete their inspection, the refund amount will be credited to the applicant's bank account.

The officer's potential actions include:

Provisional Refund: May be granted in form RFD-04 for certain refund types, typically within seven days from the acknowledgement date, sanctioning at least 90% of the claimed amount.
Acknowledgement: Form RFD-02 is issued within 15 days of filing a complete application.
Application Withdrawal: Applicants can withdraw their refund application using form RFD-01W. Upon submission, the amount debited from the electronic credit or cash ledger at the time of initial filing will be re-credited.
Deficiency Memo: If deficiencies are found, form RFD-03 may be issued within the same time limit, prompting the applicant to rectify them. In this case, an auto re-credit of the claimed refund amount occurs if the ledger was debited. A fresh application must be filed after rectification.
Clarification Notice: Form RFD-08 can be issued to seek clarification for rejecting the application or recovering a mistakenly granted refund. Applicants must respond within 15 days using form RFD-09.
Sanction/Rejection Order: The officer issues a sanction or rejection order in form RFD-06. If sanctioned, a payment order (RFD-05) is passed, sometimes after an RFD-04.
Withholding Refund: In some instances, the officer may pass an order to withhold a sanctioned refund in form RFD-07 (part-B), in which case RFD-05 is not issued.
Re-credit Order: An order to re-credit the refund amount to the taxpayer’s electronic cash or credit ledger is issued in form PMT-03 in cases of rejection or when a provisional refund was granted.