In a significant move aimed at simplifying the refund process, the Goods and Services Tax Network (GSTN) has announced major updates for refund applications under the following categories:
- Export of Services with Payment of Tax
- Supplies Made to SEZ Unit/SEZ Developer with Payment of Tax
- Refund by Supplier of Deemed Export
Key Changes Introduced
1. Removal of 'Tax Period' Requirement
One of the most notable changes is the elimination of the need to select a specific tax period ('From' and 'To') while filing refund applications under the above categories. Taxpayers can now directly proceed by choosing the relevant refund category and clicking on "Create Refund Application", without having to specify a tax period.
2. Shift from Tax Period-Based to Invoice-Based Filing
The refund application process for these categories has been transitioned from a tax period-based system to an invoice-based system. This means that taxpayers will need to upload eligible invoices as part of the refund claim.
The respective statements to be filed are as follows:
- Statement 2: For Export of Services with payment of tax
- Statement 4: For SEZ Supplies with payment of tax
- Statement 5B: For Deemed Export refunds by the supplier
3. Return Filing Prerequisite
Taxpayers are required to ensure that all mandatory returns such as GSTR-1, GSTR-3B, etc., have been filed up to the date of filing the refund application.
4. Invoice Locking Mechanism
Once invoices are uploaded and submitted as part of a refund application, they will be locked for any future changes or use in subsequent refund claims. These invoices can only be unlocked if:
- The refund application is withdrawn, or
- A deficiency memo is issued by the tax officer.
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