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GST Refund- A Comprehensive Step-By-Step Guide

GST (Goods and Service Tax) was implemented in 2016, requiring registered taxpayers or business owners to pay a tax on goods and services sold. They can later claim a GST refund by following a series of steps and submitting documents and declarations to the GST authorities. GST refunds can be used to claim the excess cash deposited in the electronic cash ledger, accumulated Input Tax Credit (ITC), or tax paid by mistake.

The forms used for claiming a GST refund vary according to the type of refund being claimed. They include relevant information you need to share to claim the amount of tax exceeding your GST liability. For example, form RFD-01 is used to claim the refund of cash paid in excess of the electronic ledger. Similarly, the GSTR-1 and GSTR-3B are applicable for the refund of IGST in exports. Also, the steps or the process varies according to the type of refund.

GST refund is a key aspect of the taxation system that ensures a smooth cash flow for businesses and saves them from losses. However, business owners often lack information and awareness about the process. In this comprehensive guide, we will cover the entire steps of the process to help you file a claim.

GST Refund Process: Understanding the Basics

Before digging deep into the specific details for each type of refund, we will outline the basic steps of the GST refund process. These are as follows:

  1. Start by checking your eligibility for a GST refund

  2. File the appropriate form to claim the refund according to your circumstances

  3. Maintain accurate and proper records and documents

  4. Get your documents reviewed by the GST authorities for verification

The refund procedure can feel complicated. To be on the right side of the tax laws, you can seek professional help. They will ensure that taxpayers are properly reimbursed for excess GST paid.

How to Claim a GST Refund: Steps to Submit a Pre-Application Form

Taxpayers need to fill out a refund pre-application form to provide information about their business, income tax details, Aadhaar number, export data, expenditure, and investment. A pre-application form has to be filed for all types of GST refunds. While it need not be signed, you cannot edit it once submitted. Here are the steps for filing the GST refund pre-application form:

Step 1:

  • Log in to the GST portal

  • Navigate to the ‘Services’ tab

  • Click on ‘Refunds’

  • Select the ‘Refund pre-application form’ option

How to Claim a GST Refund Step 1.png

Step 2:

The ‘Refund pre-application form’ page will be displayed. You must fill in the details and click on ‘Submit’, following which you will see a confirmation of submission. Details to be shared on this page include:

  • Nature of business (Manufacturer, trader, service provider, or merchant exporter)

  • Aadhaar number of the primary authorised signatory 

  • Date of issue of Import Export Certificate IEC (only for exporters)

  • Value of exports for the relevant financial year (only for exporters)

  • Income tax paid

  • Advance tax paid

  • Capital expenditure and investments made

How to Claim a GST Refund Step 2.png

What is the Refund Process of IGST on the Export of Goods (with Tax Payment)?

Under GST, exports are regarded as ‘Zero-rated supplies’. The exporter can claim a refund for the IGST and cess paid. The GST portal facilitates a simple refund process because the quantum of export transactions can be huge. Additionally, it required no separate application in form RFD-01, provided the exporter satisfies certain conditions for a GST refund. These include:

  • They must fill up the transaction-related Shipping bill details (bill number, date, and port code) in GSTR-1 and file by due date

  • They should report the summary details in item 3.1 (b) of GSTR-3

  • They should pay the corresponding and file their return by the due date prescribed by GST law

The shipping bill is considered a refund application by the GST authority. The GST portal sends export details disclosed on GSTR-1 to the ICEGATE. It also sends a confirmation that GSTR-3B was filed for the specific tax period. The Customs system processes the refund by comparing the information on GSTR-1 and the information on their Export General Manifest (EGM) and shipping bill. Further, the ICEGATE system shares payment information with the GST portal after the refund is credited to the taxpayers’ accounts. On getting an intimation, the GST portal shares this information with the taxpayers. 

Steps to Apply in Form RFD-01 for Different GST Refund Types

Here are the steps to file the Form RFD-01 for different GST refund types.

Step 1

Log in to the GST portal, reach the ‘Services’ tab, click on ‘Refunds’, and select the option of ‘Application of refund’.

Steps to Apply in Form RFD-01 Step 1.png

Step 2

Choose a reason for refund or the refund type and click on ‘Create refund application’ on the next page that appears.

Steps to Apply in Form RFD-01 Step 2.png

Step 3

Choose the period for the refund. On the ‘If you want to file a nil refund’ dialogue box, select ‘Yes’ or ‘No’. For a nil refund application, checkmark the declaration and proceed to file with DSC or EVC. This step will not apply to some refund types. These include excess cash balance in the ledger, assessment or provisional assessment, appeal or any other order, or intrastate supply later held as interstate supply and vice versa.

Steps to Apply in Form RFD-01 Step 3.png

Step 4

Enter the detail on the page displayed on the basis of the type of refund selected. These include: 

Type 1: Excess cash balance in electronic ledger- Amount of cash to be claimed

Type 2: Excess tax paid through GSTR-3B- Details of the GSTR-3B in such tax payment was done in cash

Type 3: Accumulated ITC due to exports of goods and services without tax payment 

  • Step A: Download Statement 3 and enter export invoice document details 

  • Step B: Generate the JSON file and upload it on the GST portal (while validating errors if any)

  • Step C: Enter aggregate turnover, adjusted total turnover, and net input tax credit in ‘Computation of Refund to be claimed Statement-3A [rule 89(4)]’

  • Step D: Validations take place to determine the maximum amount of refund 

Type 4: Accumulated ITC due to supplies made to SEZ unit/ developer (without tax payment)- GSTR-1 and GSTR-3B of the selected period (other steps are the same as for the Type 3 refund)

Type 5: ITC accumulated due to inverted tax structure- Statement 1A (other steps are the same as for the Type 3 refund) 

Type 6: Refund by the recipient of deemed exports- Statement 5B (other steps are the same as for the Type 3 refund) 

Type 7: Tax paid on supplies made to SEZ unit/developer (with tax payment)- Statement 4 (other steps are the same as for the Type 3 refund) 

Type 8: Tax paid on an intrastate supply later held as interstate supply and vice versa- Statement 6 (other steps are the same as for the Type 3 refund) 

Type 9: Refund by the supplier of deemed exports- Statement 5B (other steps are the same as for the Type 3 refund) 

Type 10: Refund of IGST paid on export of services (with tax payment)- Statement 2 (other steps are the same as for the Type 3 refund) 

Type 11: Assessment or provisional assessment or appeal or any other order- Details according to the type of order 

Type 12: Refund on ‘any other ground’- Mention the amount and the reason for refund in 200 characters

Step 5

Enter bank account details for receiving the refund and upload the supporting documents and declaration (in refund types where it is mandatory). You can upload up to 10 supporting documents, with file sizes limited to 5 MB each. Finally, preview the application and click to save it. Check the boxes against undertaking and self-declaration and click on the ‘Proceed’ button.

Steps to Apply in Form RFD-01 Step 5.png

Step 6

File RFD-01 with EVC or DSC. The system will generate an application reference number (ARN) and display it on the screen. You will also get it on your email address and mobile number. Save it to track your application later. The refund application is assigned to the refund processing officer. You will get a refund status update once it is processed.  If an unregistered person needs to claim a refund, they must get the GST registration to apply for a refund in RFD-01.

GST Refund Process for International Organisations and Embassies

International organisations and embassies may initiate a GST refund claim in one of these ways:

  • Generate a refund application in form RFD-10 using GSTR-11. Select the tax period/quarter and click ‘Generate RFD-10’. Select the organisation or embassy radio button and click on ‘Create’. You will see the table ‘Details of the tax paid on purchases as reported under GSTR-11’ with the amounts auto-populated from the return of the respective period. Preview and submit using DSC or EVC

  • Get the RFD-10 form on the GST portal dashboard after logging into it. Go to ‘Services’ and select ‘Refunds’. Choose the ‘Application for refund’ option. On the next page, select the option of ‘Embassy/International Organisation’ and click on ‘Create’. It will display the details of tax eligible for refund auto-populated from GSTR-11. Verify and edit or enter the refund amount. The remaining steps are the same as in the first case.

What Happens After the GST Refund is applied?

After the GST refund is applied, the application filed will appear on the dashboard of the refund processing officer or the tax officer as a pending work item. They verify and scrutinise the application and the documents to move ahead with the processing. Taxpayers can track the applications using the “Track Application Status” under Refunds. Once the authorities go through the application and attached documents, they credit the refund amount to the applicant's bank account. They take the following steps:

  • Provisional refunds may be granted for certain types of refunds in form RFD-04. A minimum of 90% of the amount of the refund claimed is granted and issued within seven days from acknowledgment.

  • Acknowledgment in form RFD-02 is given within 15 days of filing the refund if it is satisfactory.

  • Applicants can withdraw the application for a refund in form RFD-01W. On submitting the withdrawal application, the refund debited to the taxpayer’s electronic credit or cash ledger on the filing of the refund application is credited to the respective ledger.

  • The officer can issue a deficiency memo in form RFD-03 within the same time limit to address deficiencies by the applicant. Following this, an auto re-credit of refund will happen if the ledger had been debited at the time of refund application filing. In such cases, a fresh application must be submitted.

  • The officer may issue a notice to seek clarification in form RFD-08 for rejecting the application or recovery of the refund given by mistake. The applicant has to reply to form RFD-09 within 15 days.

  • The officer may pass a sanction or rejection order in form RFD-06. A payment order is passed in form RFD-05 in case of a sanction. Alternatively, RFD-05 may be issued after RFD-04.

  • In some cases, an order for withholding refund sanctioned is issued in form RFD-07 (part-B). RFD-05 is never issued in these instances.

  • Order to re-credit the refund from electronic cash or credit ledger is issued in case of rejection or when a provisional refund was granted in form PMT-03.

Frequently asked questions


What is a refund under GST?


When a taxpayer pays an excessive amount of GST exceeding their liability, they can get a tax refund under GST from the authority. To claim this refund, they must file an application with a proper refund process.


What are the forms used for the GST refund process?


GST refund forms vary according to the type of tax you pay. These include GST RFD - 01, GST RFD - 02, GST RFD - 03.


What documents are required for a GST refund?


The document list includes income tax-related documents, export-related documents, and a copy of proof of tax deposited with invoices.


How to claim a GST refund on purchases?


Input tax credit (ITC) by only a person registered under GST and using the goods or services purchased for business purposes. Additionally, they must have a valid debit note or tax invoice, receive the goods or services, pay tax, and file the return within the time limit.


How to withdraw a refund application under GST?


Applicants can withdraw the application for a refund using the form RFD-01W.

Prachi Jain

Chartered Accountant

Prachi Jain is a Chartered Accountant with a passion for simplifying finance and tax-related matters through her insightful and informative blogs. With a background in finance and a deep understanding of tax regulations, Prachi has established herself as a trusted source of financial wisdom. Prachi is committed to empowering her readers with the knowledge they need to make informed financial decisions. Her expertise and dedication shine through in every blog post, helping her audience navigate the intricacies of finance and taxes with confidence. Follow Prachi Jain's blog for practical insights and guidance on managing your finances effectively.

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