01. What is Goods and Services tax (GST) and who pays this tax?
It is a destination based tax on consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as setoff. In a nutshell, only value addition will be taxed and burden of tax is to be borne by the final consumer.
02.Which of the existing taxes are proposed to be subsumed under GST?
The GST would replace the following taxes:
(i) Taxes currently levied and collected by the Centre:
a. Central Excise duty
b. Duties of Excise (Medicinal and Toilet
Preparations)
c. Additional Duties of Excise (Goods of Special
Importance)
d. Additional Duties of Excise (Textiles and Textile
Products)
e. Additional Duties of Customs (commonly known
as CVD)
f. Special Additional Duty of Customs (SAD)
g. Service Tax
h. Central Surcharges and Cesses so far as they relate to supply of goods and services
(ii) State taxes that would be subsumed under the GST
are:
a. State VAT
b. Central Sales Tax c. Luxury Tax
d. Entry Tax (all forms)
e. Entertainment and Amusement Tax (except when
levied by the local bodies)
f. Taxes on advertisements
g. Purchase Tax
h. Taxes on lotteries, betting and gambling
i. State Surcharges and Cesses so far as they relate to supply of goods and services
The GST Council shall make recommendations to the Union and States on the taxes, cesses and surcharges levied by the Centre, the States and the local bodies which may be subsumed in the GST.
03. Which are the commodities proposed to be kept outside the purview of GST?
Goods and Services tax (GST) is a tax on supply of goods or services or both, except supply of alcoholic liquor for human consumption. So alcohol for human consumption is kept out of GST by way of definition of GST on constitution. Five petroleum products viz. petroleum crude, motor spirit (petrol), high speed diesel, natural gas and aviation turbine fuel have temporarily been kept out and GST Council shall decide the date from which they shall be included in GST. Furthermore, electricity has been kept out of GST.
04. Which authority will levy and administer GST?
Centre will levy and administer CGST & IGST while respective states /UTs will levy and administer SGST/ UTGST.
05. Who is liable to pay GST under the proposed GST regime?
Under the GST regime, tax is payable by the taxable person on the supply of goods and/or services. Liability to pay tax arises when the taxable person crosses the turnover threshold of Rs.20 lakhs (Rs. 10 lakhs for NE & Special Category States) except in certain specified cases where the taxable person is liable to pay GST even though he has not crossed the threshold limit. The CGST / SGST is payable on all intra-State supply of goods and/or services and IGST is payable on all inter- State supply of goods and/or services. The CGST /SGST and IGST are payable at the rates specified in the Schedules to the respective Acts.
06.What are the benefits available to small tax payers under the GST regime?
Under the GST regime, small taxpayers are provided relief by way of higher exemption limits and simplified schemes. Suppliers of services are required to take GST registration only if their aggregate turnover exceeds ?20 lakh in a financial year (?10 lakh in special category States). In case of suppliers of goods, the exemption limit is ?20 lakh, which may be enhanced up to ?40 lakh for persons exclusively engaged in supply of goods, subject to prescribed conditions. Further, eligible registered persons can opt for the Composition Scheme, which allows payment of tax at concessional rates with reduced compliance requirements.
07.What is the scope of composition scheme under GST?
The Composition Scheme under GST is available to small taxpayers whose aggregate turnover in the preceding financial year does not exceed ?1.5 crore (?75 lakh in special category States). Under this scheme, tax is paid at concessional rates on turnover in the State/UT, without availing input tax credit, and the taxpayer cannot collect GST from customers.
The scheme is not available to persons making inter-State supplies or supplying through e-commerce operators liable to collect TCS. The objective of the scheme is to simplify compliance and reduce the tax burden for small taxpayers.
08. What is the taxable event under GST?
Taxable event under GST is supply of goods or services or both. CGST and SGST/ UTGST will be levied on intra-State supplies. IGST will be levied on inter-State supplies.
Yes, but only those activities which are specified in Schedule I to the CGST Act / SGST Act. The said provision has been adopted in IGST Act as well as in UTGST Act also.
10. What are composite supply and mixed supply? How are these two different from each other?
Composite supply is a supply consisting of two or more taxable supplies of goods or services or both or any combination thereof, which are bundled in natural course and are supplied in conjunction with each other in the ordinary course of business and where one of which is a principal supply. For example, when a consumer buys a television set and he also gets warranty and a maintenance contract with the TV, this supply is a composite supply. In this example, supply of TV is the principal supply, warranty and maintenance service are ancillary.
Mixed supply is combination of more than one individual supplies of goods or services or any combination thereof made in conjunction with each other for a single price, which can ordinarily be supplied separately. For example, a shopkeeper selling storage water bottles along with refrigerator. Bottles and the refrigerator can easily be priced and sold separately.
11. What is meant by Reverse Charge?
It means the liability to pay tax is on the recipient of supply of goods and services instead of the supplier of such goods or services in respect of notified categories of supply.
12. Can any person other than the supplier or recipient be liable to pay tax under GST?
Yes, the Central/State government can specify categories of services the tax on which shall be paid by the electronic commerce operator, if such services are supplied through it and all the provisions of the Act shall apply to such electronic commerce operator as if he is the person liable to pay tax in relation to supply of such services.
13. Can the registered person under composition scheme claim input tax credit?
No, registered person under composition scheme is not eligible to claim input tax credit.
14. What is aggregate turnover?
As per section 2(6) of the CGST/SGST Act “aggregate turnover” includes the aggregate value of:
(i) all taxable supplies,
(ii) all exempt supplies,
(iii) exports of goods and/or service, and,
(iv) all inter-state supplies
of a person having the same PAN.
The above shall be computed on all India basis and excludes taxes charged under the CGST Act, SGST Act, UTGST Act, and the IGST Act. Aggregate turnover shall include all supplies made by the Taxable person, whether on his own account or made on behalf of all his principals.
Aggregate turnover does not include value of supplies on which tax is levied on reverse charge basis, and value of inward supplies.
The value of goods after completion of job work is not includible in the turnover of the job-worker. It will be treated as supply of goods by the principal and will accordingly be includible in the turnover of the Principal.
15.Who is a Casual Taxable Person?
Casual Taxable Person has been defined in Section 2 (20) of the CGST/SGST Act meaning a person who occasionally undertakes transactions involving supply of goods and/or services in the course or furtherance of business, whether as principal, or agent or in any other capacity, in a State or a Union territory where he has no fixed place of business.
16.Is there any facility for digital signature in the GSTN registration?
Tax payers would have the option to sign the submitted application using valid digital signatures. There will be two options for electronically signing the application or other submissions- by e-signing through Aadhar number, or through DSC i.e. by registering the tax payer’s digital signature certificate with GST portal. However, companies or limited liability partnership entities will have to sign mandatorily through DSC only. Only level 2 and level 3 DSC certificates will be acceptable for signature purpose.
17.What are the necessary elements that constitute supply under CGST/SGST Act?
In order to constitute a ‘supply’, the following elements are required to be satisfied, i.e.-
(i) the activity involves supply of goods or services or both;
(ii) the supply is for a consideration unless otherwise specifically provided for;
(iii) the supply is made in the course or furtherance of business;
(iv) the supply is made in the taxable territory;
(v) the supply is a taxable supply; and
(vi) the supply is made by a taxable person.
18. Are self-supplies taxable under GST?
Inter-state self-supplies such as stock transfers, branch transfers or consignment sales shall be taxable under IGST even though such transactions may not involve payment of consideration. Every supplier is liable to register under the GST law in the State or Union territory
from where he makes a taxable supply of goods or services or both in terms of Section 22 of the model GST law. However, intra-state self-supplies are not taxable subject to not opting for registration as business vertical.
Title as well as possession both have to be transferred for a transaction to be considered as a supply of goods. In case title is not transferred, the transaction would be treated as supply of service in terms of Schedule II (1) (b). In some cases, possession may be transferred immediately but title may be transferred at a future date like in case of sale on approval basis or hire purchase arrangement. Such transactions will also be termed as supply of goods.
Works contracts and catering services shall be treated
as supply of services as both are specified under Sl. No. 6 (a) and (b) in Schedule-II of the model GST law.
Supply of goods on hire purchase shall be treated as supply of goods as there is transfer of title, albeit at a future date.
22. What is a Composite Supply under CGST/ SGST/UTGST Act?
Composite Supply means a supply made by a taxable person to a recipient comprising two or more supplies of goods or services, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply. For example, where goods are packed and transported with insurance, the supply of goods, packing materials, transport and insurance is a composite supply and supply of goods is the principal supply.
Electronic Ledgers or E-Ledgers are statements of cash and input tax credit in respect of each registered taxpayer. In addition, each taxpayer shall also have an electronic tax liability register. Once a taxpayer is registered on Common Portal (GSTN), two e-ledgers (Cash &Input Tax Credit ledger) and an electronic tax liability register will be automatically opened and displayed on his dash board at all times
Input Tax Credit as self-assessed in monthly returns will be reflected in the ITC Ledger. The credit in this ledger can be used to make payment of TAX ONLY and not other amounts such as interest, penalty, fees etc.
25. Can a challan generated online be modified?
No. After logging into GSTN portal for generation of challan, payment particulars have to be fed in by the tax payer or his authorized person. He can save the challan midway for future updation. However once the challan is finalized and CPIN generated, no further changes can be made to it by the taxpayer.
TDS stands for Tax Deducted at Source (TDS). As per section 51, this provision is meant for Government and Government undertakings and other notified entities making contractual payments where total value of such supply under a contract exceeds Rs. 2.5 Lakhs to suppliers. While making any
payments under such contracts, the concerned Government/authority shall deduct 1% of the total payment made and remit it into the appropriate GST account.
27.How will the TDS Deductor account for suchTDS?
TDS Deductor will account for such TDS in the following ways:
1. Such deductors needs to get compulsorily registered under section 24 of the CGST/SGST Act.
2. They need to remit such TDS collected by the 10th day of the month succeeding the month in which TDS was collected and reported in GSTR 7.
3. The amount deposited as TDS will be reflected in the
electronic cash ledger of the supplier.
4. They need to issue certificate of such TDS to the deductee within 5 days of deducting TDS failing which fees of Rs. 100 per day subject to maximum of Rs. 5000/- will be payable by such deductor
No. Under the GST law, it is not compulsory that inputs or capital goods must be purchased only from manufacturers for availing input tax credit (ITC). ITC is available if the goods or services are procured from any registered supplier, whether a manufacturer, trader, wholesaler, or service provider, subject to fulfilment of the prescribed conditions under the GST Act (such as possession of a valid tax invoice, receipt of goods or services, tax charged having been paid to the Government, and filing of returns).
30. What is Tax Collected at Source (TCS)?
This provision is applicable only for E-Commerce Operator under section 52 of CGST/SGST Act. Every E-Commerce Operator, not being an agent, needs to
withhold an amount calculated at the rate not exceeding one percent of the “net value of taxable supplies” made through it where the consideration with respect to such supplies is to be collected by the operator. Such withheld amount is to be deposited by such E-Commerce Operator to the appropriate GST account by the 10th of the next month. The amount deposited as TCS will be reflected in the electronic cash ledger of the supplier.
31. Is it mandatory for e-commerce operator to obtain registration?
Yes. The benefit of threshold exemption is not available to e-commerce operators and they would be liable to be registered irrespective of the value of supply made by them.
No. The threshold exemption is not available to such suppliers and they would be liable to be registered irrespective of the value of supply made by them. This requirement, however, is applicable only if the supply is made through such electronic commerce operator who is required to collect tax at source.
No. Threshold exemption is not available to e-commerce operator who are require to pay tax on notified services provided through them.
Principal shall be entitled to take credit of taxes paid on inputs or capital goods sent to a job worker whether sent after receiving them at his place of business or even when such the inputs or capital goods are directly sent to a job worker without their being first brought to his place of business. However, the inputs or capital goods, after completion of job work, are required to be received back or supplied from job worker’s premises, as the case may be, within a period of one year or three years of their being sent out.
35. Whether Cancellation of Registration Certificate is permissible?
Any Registration granted under this Act may be cancelled by the Proper Officer, on
various circumstances and the provisions of the law on this subject have been outlined
under Section 29 of the ACT. The proper officer may, either on his own motion or on an
application filed, in the prescribed manner, by the registered taxable person or by his
legal heirs, in case of death of such person, cancel the registration, in such manner and
within such period as may be prescribed
Q 36. What will be the implications in case of purchase of goods from unregistered dealers?
The receiver of goods will not be able to get ITC. Further, the recipients who are registered under composition schemes would be liable to pay tax under reverse charge.
Q 37.What will be the composition of Authority for advance rulings (AAR) under GST?
‘Authority for advance ruling’ (AAR) shall comprise one member CGST and one member SGST. They will be appointed by the Central and State government respectively. Their qualification and eligibility condition for appointment will be prescribed in the Model GST Rules.
New registration would be required as partnership firm would have new PAN.
Provisional GSTIN (PID) should be converted into final GSTIN within 90 days. Yes, provisional GSTIN can be used till final GSTIN is issued. PID & final GSTIN would be same.
If the person is involved in 100% supply of goods which are not liable for GST, then no registration is required.
Q41. Not liable to tax as mentioned u/s 23 of CGST means nil rated supply or abated value of supply?
Not liable to tax means supplies which is not leviable to tax under the CGST/SGST/IGST Act. Please refer to definition under Section 2(78) of the CGST Act.
A supplier of service will have to register at the location from where he is supplying services.
Outward supplies on which tax is paid on reverse charge basis by the recipient will be included in the aggregate turnover of the supplier.
SEZs under same PAN in a state require one registration. Please see proviso to rule 8(1) of CGST Rules.
Q45.Is an advocate providing interstate supply chargeable under Reverse Charge liable for registration? Exemption from registration has been provided to such suppliers who are making only those supplies on which recipient is liable to discharge GST under RCM.
If services are being provided from Nasik then registration is required to be taken only in Maharashtra and IGST to be paid on inter-state supplies.
Yes. Even if you have already migrated and obtained GST registration, you can apply separately for registration as an Input Service Distributor (ISD).
Under GST, ISD registration is mandatory and distinct from a normal registration. A person cannot distribute ITC without obtaining a separate ISD registration, even if both registrations are in the same State.
Procedure:
- Apply for fresh GST registration in Form GST REG-01.
- Select "Input Service Distributor" as the type of registration.
- ISD registration will be granted as a separate GSTIN (same PAN, same State).
- After registration, ITC on input services can be distributed to recipient units through ISD invoices in the prescribed manner.
Thus, migration under GST does not bar subsequent ISD registration, and the same can be applied for at any time, subject to compliance with GST provisions.
Q48. I have enrolled in GST but I forgot to enter SAC codes. What should I do?
If you have enrolled under GST but forgot to enter SAC codes, you need not worry.
GST law does not mandate declaration of SAC/HSN codes at the time of enrolment or registration. HSN/SAC details are required to be mentioned at the time of issuing tax invoices and in returns, based on the applicable turnover limits.
If you still wish to update the details for correctness or business clarity, you may do so by:
- Logging into the GST portal, and
- Filing an application for amendment of registration details (Form GST REG-14), where business particulars can be updated.
Thus, non-mention of SAC codes at the time of enrolment does not affect the validity of registration, and the same can be corrected later, if required.
Separate registration as tax deductor is required.
Q50.Is separate registration required for trading and manufacturing by same entity in one state?
There will be only one registration per State for all activities.
Any person who makes make interstate taxable supply is required to take registration. Therefore in this case AP dealer shall take registration and pay tax.
Q52.Is there any concept of area based exemption under GST?
There will be no area based exemptions in GST
Yes, you will be liable to pay tax on reverse charge basis for supplies from unregistered person.
In such a case the person can issue one tax invoice for the taxable invoice and also declare exempted supply in the same invoice.
Q55. Do registered dealers have to record Aadhaar/PAN while selling goods to unregistered dealers?
There is no requirement to take Aadhaar / PAN details of the customer under the GST Act.
Advance refunded can be adjusted in return.
Q57. Do registered dealers have to upload sale details of unregistered dealers also in GST?
Generally not. But required in case of inter-State supplies having invoice value of more than Rs 2.50 Lakhs.
Q58. What is GSTR-9 and who is required to file it?
GSTR-9 is the annual return to be filed by normal registered persons, subject to prescribed exemptions.
Q59. Who is exempt from filing GSTR-9 and GSTR-9C?
Certain taxpayers, based on turnover limits and notifications, are exempt from filing GSTR-9 and GSTR-9C.
Q60. Can a Chartered Accountant file GST returns on behalf of a taxpayer?
Yes. A Chartered Accountant or authorised representative can file GST returns using proper authorisation.
Q61. Which GST returns are required to be filed by a normal registered person?
A normal registered person is required to file GSTR-1 (details of outward supplies) and GSTR-3B (summary return with tax payment).
Q62. What is the due date for filing GSTR-1?
GSTR-1 is required to be filed monthly or quarterly, depending on turnover and the option exercised under the QRMP scheme.
GSTR-3B is a monthly/quarterly summary return in which tax liability is declared and GST is paid.
Q64. Is it mandatory to file GST returns even if there is no business activity?
Yes. Nil GST returns must be filed even if there are no transactions during the tax period.
Q65. What happens if GST returns are not filed on time?
Late filing attracts late fees and interest, and continuous default may lead to blocking of e-way bills and cancellation of registration.
Q66. Can GST returns be revised after filing?
No. GST returns cannot be revised, but errors can be rectified in subsequent returns, subject to time limits.
Q67. What is the late fee and interest for delayed GST returns?
Late fee is prescribed per day, subject to a maximum limit, and interest is payable at 18% per annum on delayed tax payment.
Q68. How can I file a Nil GST return?
A Nil return can be filed online on the GST portal, even if there are no outward supplies, inward supplies, or tax liability.
Q69. Is GSTR-2A or GSTR-2B mandatory for claiming ITC?
Yes. Input tax credit should be claimed based on GSTR-2B, subject to conditions prescribed under GST law.
Q70. Can ITC be claimed if the supplier has not filed GSTR-1?
No. ITC is not eligible if the supplier has not reported the invoice in GSTR-1, as it will not reflect in GSTR-2B.
Q71. What is the difference between GSTR-2A and GSTR-2B?
GSTR-2A is dynamic, whereas GSTR-2B is a static statement used for determining eligible ITC for a tax period.
Q72. How can mistakes in GST returns be corrected?
Mistakes can be corrected in subsequent GST returns, within the time limits prescribed under the GST Act.
Q73. Can GST returns be filed without payment of tax?
GSTR-1 can be filed without tax payment, but GSTR-3B cannot be filed unless tax liability is paid.
Q74. Is GST return filing required after cancellation of registration?
Yes. Returns must be filed up to the effective date of cancellation, including final return (GSTR-10) where applicable.
Q75. What is the penalty for non-filing of GSTR-3B?
Non-filing attracts late fee, interest, and may result in suspension or cancellation of GST registration.
Q76. Can GST returns be filed if books of accounts are not finalized?
Returns should be filed based on available data, and necessary adjustments can be made later within permitted limits.
Q77. Is GST return filing mandatory online?
Yes. GST returns are required to be filed electronically through the GST portal.
LUT (Letter of Undertaking) is a document filed by exporters to export goods or services without paying GST.
👉 Instead of paying GST and later claiming refund, you can avoid paying GST altogether by filing LUT.
Any registered taxpayer who is:
✔ Exporting goods
✔ Exporting services
✔ Supplying to SEZ (Special Economic Zone)
👉 Almost all exporters can file LUT (no restriction now).
Q80. What is the benefit of LUT?
👉 Major benefits:
✔ No need to pay GST on exports
✔ No need to block working capital
✔ No need to claim refund later
👉 Saves time + improves cash flow
Q81. What happens if LUT is not filed?
If LUT is not filed:
❌ You must pay GST on export
❌ Then apply for refund
👉 This leads to:
- Delay in refund
- Cash flow issues
Q82. Is LUT mandatory for export?
👉 Not compulsory, but highly recommended
You have 2 options:
✔ Export with LUT (without GST)
✔ Export with payment of GST (and claim refund)
👉 Most businesses prefer LUT.
Q83. Is LUT required for both goods and services?
✔ Yes
LUT is applicable for:
- Export of goods
- Export of services
- Supply to SEZ
Q84. What is the validity of LUT?
👉 LUT is valid for one financial year only
✔ Must be filed every year
✔ Example:
FY 2025-26 → New LUT required
Q85. What is the due date for LUT filing?
👉 No strict due date, but:
✔ Must be filed before making export
👉 Best practice:
File LUT at the start of financial year
Q86. What is the condition after filing LUT?
👉 You must:
✔ Export goods within 3 months
✔ Receive payment (for services) within 1 year
👉 Otherwise:
❌ GST becomes payable with interest
Q87. Is LUT required for each export invoice?
❌ No
👉 One LUT covers all exports for the whole year
Q88. Can a new business file LUT?
✔ Yes
👉 Even new GST registration holders can file LUT immediately.
Q89. What if export payment is not received?
👉 If payment not received within time:
❌ GST must be paid
✔ Along with interest
Q90. Is LUT filing compulsory every year?
✔ Yes
👉 Must renew every financial year
👉 Old LUT becomes invalid
Yes, you can receive payment anytime in your bank account—there is no restriction under GST on receiving money before filing LUT.
👉 However, the important point is:
✔ LUT must be filed before issuing the export invoice or making the export supply
Q92. What is export under GST?
Export under GST means supplying goods or services from India to a place outside India. In simple terms, when a business in India sells goods or provides services to a foreign customer, it is treated as export. As per GST law, exports are considered as zero-rated supplies, which means no tax burden is ultimately borne by the exporter.
Export means taking goods or services outside India.
👉 Under GST, exports are treated as:
✔ Zero-rated supply
Meaning:
- No GST burden on exporter
- Full ITC (Input Tax Credit) available
Q93. What is Zero-Rated Supply?
Zero-rated supply means that the GST rate applicable on such supply is 0%, but the supplier is still eligible to claim input tax credit on purchases. This is a major benefit because the exporter does not have to bear the cost of GST paid on inputs, ensuring that exports remain competitive in the international market.
👉 Zero-rated means:
✔ GST rate = 0%
✔ But ITC is still allowed
👉 This is different from exempt supply.
Q94. What is the difference between zero-rated supply and exempt supply?
Although both zero-rated and exempt supplies have no GST on outward supply, there is a major difference. In zero-rated supply (like exports), the taxpayer can claim input tax credit. However, in exempt supply, input tax credit is not allowed. Therefore, exports are more beneficial compared to exempt supplies.
| Particulars | Zero-rated | Exempt |
|---|---|---|
| GST Rate | 0% | 0% |
| ITC Allowed | ✅ Yes | ❌ No |
| Example | Export | Healthcare |
Q95. What are the options available for export under GST?
There are two options available for making exports under GST.
- The first option is exporting under LUT (Letter of Undertaking), where no GST is paid at the time of export.
- The second option is exporting with payment of IGST and then claiming a refund later.
Most exporters prefer LUT because it avoids blockage of funds.
Export of goods refers to physically sending goods from India to a foreign country. The export is considered complete when the goods cross the customs frontier of India and are taken outside the country. For example, if a manufacturer sends products to a buyer in the USA, it is treated as export of goods.
Q97. What is export of services?
Export of services occurs when a service provider in India provides services to a client located outside India, and certain conditions are satisfied. These include that the supplier is in India, the recipient is outside India, the place of supply is outside India, and the payment is received in convertible foreign exchange. For example, a freelancer in India providing services to a US client is considered export of services.
Q98. What is place of supply in export transactions?
Place of supply is the location where a transaction is considered to take place for GST purposes. In the case of exports, the place of supply is outside India. This is one of the key reasons why exports qualify as zero-rated supplies under GST law.
👉 For export:
✔ Place of supply = Outside India
👉 That’s why it qualifies as export.
Q99. Is GST applicable on export transactions?
Generally, GST is not payable on export transactions if the exporter has filed LUT. However, if LUT is not filed, the exporter is required to pay IGST at the time of export and later claim a refund. Therefore, GST is either avoided or refunded in case of exports.
👉 Normally:
❌ No GST (if LUT filed)
👉 Otherwise:
✔ GST is paid and refunded later
Q100. Can exporters claim refund under GST?
Yes, exporters are eligible to claim refunds under GST. If the exporter uses LUT, they can claim a refund of input tax credit accumulated on purchases. If the exporter pays IGST on export, they can claim a refund of the tax paid. This ensures that exports remain tax-free.
Q101. What is the time limit for export under GST?
When exports are made under LUT, goods must be exported within Three months from the date of invoice. In case of export of services, payment must be received within one year from the date of invoice. If these conditions are not fulfilled, GST becomes payable along with interest.
Q102. What happens if export conditions are not fulfilled?
If the exporter fails to export goods within the prescribed time or does not receive payment for services within the allowed period, the benefit of zero-rated supply is withdrawn. In such cases, the exporter is required to pay GST along with applicable interest.
Q103. Is GST registration compulsory for exporters?
Yes, GST registration is mandatory for exporters, even if their turnover is below the normal threshold limits. This is because export is treated as an interstate supply, and registration is compulsory in such cases.
Q104. Can exports be made without LUT?
Yes, exports can be made without LUT, but in such cases, the exporter has to pay IGST at the time of export and then claim a refund. This method is less preferred because it blocks working capital.
Q105. How does refund work in export cases?
Refund in export cases can be claimed either for input tax credit (when LUT is used) or for IGST paid (when tax is paid on export). The refund application is filed on the GST portal and is processed after verification of documents.
Q106. What should be mentioned on export invoice?
The export invoice must clearly mention that the supply is meant for export under LUT without payment of IGST. This declaration is important to claim the benefit of zero-rated supply.
Supply to a Special Economic Zone (SEZ) is treated as a zero-rated supply, similar to export. Even though the supply is made within India, it is given the same benefit as export, and the supplier can use LUT or claim refund.
Deemed export refers to certain transactions where goods do not leave India but are still treated as export for GST purposes. These are notified by the government, and benefits like refund are available in such cases.
Deemed export refers to certain transactions where goods do not leave India but are still treated as export for GST purposes. These are notified by the government, and benefits like refund are available in such cases.
Q110. What is the benefit of export under GST?
The main benefit of export under GST is that it is tax-free. The exporter does not bear GST cost and can claim input tax credit or refund. This ensures that Indian goods and services remain competitive in the global market.