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File Letter of Undertaking (LUT) in GST
 
               GST RFD-11 Form, Eligibility, and Document Filling Procedure

 

How does LUT work with GST?

 

LUT in GST stands for Letter of Undertaking in its full form. The exporter certifies that they will comply with all requirements set forth under GST while exporting without paying IGST, and this declaration is required to be made in the according to Rule 96A, form GST RFD 11.

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Who is obligated to submit LUT using Form GST RFD-11?

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All exporters of goods and services who have registered for GST must submit a GST LUT. Exporters who have been charged with a crime or who have committed tax evasions totaling more than Rs 250 lakhs in violation of the CGST Act, the Integrated Goods and Services Act of 2017, or any other applicable law are ineligible to submit a GST LUT. Under these conditions, they would have to the government's goal in this case was to increase the export base by granting export subsidies. You can get assistance from Account Kart ' GST specialists with GST LUT filing or Export bond filing.

Any registered person is permitted, under the CGST Rules, 2017, to submit an Export Bond or LUT in GST RFD 11 without having to pay the Integrated Tax. In the event that:

  • They are GST-registered if they intend to provide goods or services to SEZs, India, or other countries.

  • Without paying the integrated tax, they want to supply goods.

 
Documents Required for LUT under GST

 

Any person registered under GST is eligible to submit a LUT as long as they haven't been executed for tax evasion of more than Rs. 250 lakh or any other crime.

  • A properly performed written request for LUT acceptance that is made in this manner.

  • Copy of the entity's PAN card for GST registration, together with KYC information for the signer's authorization

  • A replica of the IEC code

  • Unpaid Cheque

  • Approved letter

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Process for Filing LUT in GST?

 

Below are the processes on how to file and furnish bonds when the exports are done without payment of taxes in order to file a Letter of Undertaking (LUT).

Verify the jurisdictional and supplying requirements. Additional documentation pertaining to the bank guarantee must be prepared if a bond is to be issued.

Prepare the Bonds' required paperwork. Bond applications must include the following documentation:

For bonds:

  • Bank guarantee letter,

  • Form RFD-11 Bond on stamp paper, and

  • Additional supporting papers.

Each consignment does not require its own bond to be provided. He can instead provide a running bond. A running bond enables the exporter to apply the same terms and conditions from the current shipment to the subsequent consignment.

An official document should be created with a duplicate copy.

To avoid any rejection, the next step is to submit the documents to the department and have them verified by an appropriate official.

An official letter acknowledging receipt of the document must be issued by the officer after it has been filed.

 
Eligibility for Filing LUT in GST

 

Who is eligible to use a Letter of Undertaking (LUT)?

Every registered taxpayer who exports products or services has access to the Letter of Undertaking. Anyone who has been charged with tax fraud and has faced legal action Rs. 250 lakh or more is ineligible.

 

These LUTs are only good for a calendar year, and exporters are required to submit a new LUT for every fiscal year. The rights will be removed and the exporter will be required to post bonds if the conditions outlined in the LUTs are not met within the allotted time frame.

If the export is made without the IGST being paid, other assesses must provide bonds. Applying bonds and LUTs to:

  • Without paying IGST, it delivers services to a client in a non-Indian country.

  •  Exporting goods to a country outside of India without doing so.

  • Letter of Engagement filing (FORM GST RFD-11).

 
Letter of Engagement filing (FORM GST RFD-11)

 

Following is the format for filing the Form RFD-11:

  • Date of supply,

  • Registered Name,

  • Address,

  • GST No.

  • Signature,

  •  Time

  • Location

  • Observer information (Name, address, and occupation)

 

Export Bond for GST

 

Based on the aforementioned requirements, entities who are not qualified to submit a Letter of Undertaking must provide an export bond and a bank guarantee. The amount of tax related to the export must be paid by the applicant based on the self-assessed anticipated tax liability.

The export bond should be supplied on non-judicial stamp paper with a value that is acceptable in the State where it is being provided.

Additionally, exporters may provide a running bond, which eliminates the requirement that an export bond be performed for each export transaction. However, the exporter is required to provide a new bond to cover the increased responsibility if the unpaid export tax liability at any point exceeds the amount of the original bond.

Along with an export bond, a bank guarantee may be required. Generally speaking, the bank guarantee's worth shouldn't be more than 15% of the bond's value. However, the jurisdictional GST Commissioner may waive the bank guarantee that must be given with the export bond depending on the exporter's track record.

A bond form:

  • Licensed Name

  • Address

  •  The amount of the provided bond.

  • When it was furnished

  • a bank guarantee's amount, if any.

  • Signature, time, and location

  • Observer information (Name, address, and occupation)

 
GST LUT Form FAQ's

 

1. What information should go in the letter of undertaking?

 Based on login, the GSTIN and Name (Legal Name) of the Taxpayer will be prefilled. The tax payer must choose the fiscal year for which the LUT is being submitted and provide the names, addresses, and occupations of two trustworthy and impartial witnesses.

 

2. Is it required to enter the manually authorised LUT into the online records?

It is not required, but if the Taxpayer wants to include the manually authorized LUT in the online records, he can do so while submitting the online application.

 

3. Who is required to sign the LUT application?

Any other approved signatories as well as the primary authorized signatory must sign and submit the verification to DSC/EVC. The person legally permitted by the operating partner, board of directors of the company, or proprietor to sign the form may be the operating partner, managing director, or proprietor.

 

4. How would I be able to tell if the LUT provisioning procedure has been completed?

The system will produce an acknowledgment and an ARN after a successful filing. You can download the acknowledgment as a PDF and will be notified by SMS and email whether your submission was successful.

 

5. Can the LUT application be viewed after it has been submitted?

The Taxpayer will indeed be able to view his LUT following filing.

 

6. Is filing a GST LUT necessary?

To export products, services, or both without paying the IGST, a Letter of Undertaking (LUT) must be provided.

 

7. What takes place when the exporter forgets to provide the LUT?

Exporters are required to pay IGST or present an export bond in the event that they fail to provide the LUT.

 

8. Who is qualified to provide LUT under GST?

Any exporter of products or services is able to provide the LUT.

 

9. Who is not allowed to provide under the GST?

A person who has been charged under the act with evading taxes for  The LUT may not be provided if the amount exceeds Rs. 2.5 crore.

 

10. What paperwork is necessary for GST LUT filing?

LUT covering letters, properly signed by an authority figure Copy of the entity’s GST registration PAN

 

11. What happens if the LUT is not delivered on time?

If the LUT is late, the exporter must pay the tax while conducting the exports and then file a refund claim to take advantage of the zero-rated exports.

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12. What is Form RFD 11? 

Providing a bond or letter of commitment for the export of goods or services in Form RFD 11.

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