Export of Services with LUT

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This discussion clarifies the process for proprietorships exporting services under GST using a Letter of Undertaking (LUT). It confirms that applying for LUT annually is correct for exporting services without collecting GST. Crucially, it explains that input tax credit on expenses related to these exports (like office rent or phone bills) can still be claimed as a refund, even though no GST was collected on the export itself. The user is assured they are filing correctly by submitting their invoices as 'Export without GST' and filing them annually.

Rahul Singh

Rahul Singh (Querist)

12 February 2021 hello, I run proprietorship service business and do mostly export of services like tech. I do LUT in GST to sell without collecting service tax, is that correct?

help please.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

12 February 2021 Yes, it's right. Claim refund of input tax related to such exports.

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Rahul Singh

Rahul Singh (Querist)

12 February 2021 Sorry I did not understand. you mentioned "claim refund" for? because as I mentioned I sell service "without collecting service tax".

please confirm. thanks.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

12 February 2021 In such a case also you can claim refund of input tax.

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Rahul Singh

Rahul Singh (Querist)

12 February 2021 Do I have to apply for LUT every year in GST portal?

You mean I can claim for refund of input tax? even though I didn't paid GST or have not even collected

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

13 February 2021 Yes, you have to apply for LUT every year.
In your expenses bill related to export of software where GST is paid you can claim refund. Like rent paid for office, telephone bill etc.

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Rahul Singh

Rahul Singh (Querist)

13 February 2021 thanks for the confirmation!!!

So if I have understood this correctly, I keep submitting LUT every year in GST portal then I don't have to collect GST for Export of Service and not even have to submit any GST. Just keep filing those invoices as "Export without GST", right?

I hope there is no limit to raise invoice without GST in export of service. because most of my business is export of service and I don't collect GST but I make sure each invoice is filed in GST.

hope I am doing everything correctly.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

13 February 2021 Yes, you are doing it rightly.

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Rahul Singh

Rahul Singh (Querist)

13 February 2021 thanks a lot sir for all your help, you are so helpful in this forum.

Rahul Singh

Rahul Singh (Querist)

13 February 2021 Sir can you please check this also? https://www.caclubindia.com/experts/employee-salary-pf-etc--2832694.asp

Rahul Singh

Rahul Singh (Querist)

01 March 2021 Sir, if I apply for LUT now for Financial Year 2021-2022 then will that be valid for whole Financial Year 2021-2022? or its just for 12 months from the date of applying?

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

01 March 2021 It will be valid for whole Financial Year 2021-2022.

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Rahul Singh

Rahul Singh (Querist)

01 March 2021 Thanks sir always for help!

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