Gst
This query is : Resolved
03 June 2017
What about the procedure or tax treatment for export under gst
03 June 2017
As defined under IGST law, a “Zero Rated Supply” means any of the following supply of goods/services namely:-
(a) Export of goods/services; or
(b) Supply of goods /services to a SEZ developer or an SEZ unit
Supplier of zero rates goods/services can claim credit of input tax irrespective of the fact that such services/goods are notified as exempted supplies. Further, it is important to note that incase a service is not an export of service under the definition of export of services, then GST shall be chargeable since there is no exemption as such.
(a) Export of goods/services; or
(b) Supply of goods /services to a SEZ developer or an SEZ unit
Supplier of zero rates goods/services can claim credit of input tax irrespective of the fact that such services/goods are notified as exempted supplies. Further, it is important to note that incase a service is not an export of service under the definition of export of services, then GST shall be chargeable since there is no exemption as such.
05 June 2017
We have to charge the gst on export bill ?Or we have to get the refund of the same or made the bill without charging gst
26 July 2024
Under the Goods and Services Tax (GST) regime in India, the tax treatment for exports is designed to make exports zero-rated. This means that while exports are subject to GST, the tax rate on exported goods and services is effectively zero. Here’s how the procedure and tax treatment for exports work under GST:
### Tax Treatment for Exports Under GST
1. **Zero-Rated Supply:**
- Exports are treated as **zero-rated supplies** under GST. This means that the supply of goods or services for export is subject to a GST rate of 0%.
2. **Invoicing for Exports:**
- When you invoice for an export, you should issue the invoice without charging GST. You must mention on the invoice that the supply is "Zero-rated supply" and quote the relevant section of the GST law (Section 16 of the IGST Act).
3. **Documentation:**
- Ensure proper documentation is maintained, including:
- **Export Invoice:** Should clearly state that it is a zero-rated supply.
- **Shipping Bill/Bill of Export:** This is required for export documentation and should be linked with the GST invoice.
- **Bank Realization Certificate:** Proof of receipt of foreign exchange, if applicable.
4. **Claiming Input Tax Credit (ITC):**
- **Refund of ITC:** As exports are zero-rated, you can claim a refund of the input tax credit (ITC) on inputs, input services, and capital goods used for making zero-rated supplies.
- **Refund Mechanism:** The refund of ITC can be claimed under either of the following methods:
- **Refund of ITC on Exports Without Payment of Tax:** This applies when no tax is charged on the export invoice.
- **Refund of ITC on Exports With Payment of Tax:** If GST has been paid on inputs and the export is made with tax payment, you can claim a refund of the tax paid on such inputs.
5. **Export Without Payment of Tax:**
- For exports without payment of tax, you must:
- Export goods or services under a bond or letter of undertaking (LUT) without payment of IGST.
- Ensure that the LUT is approved by the GST authorities and is valid.
6. **Export With Payment of Tax:**
- If you choose to pay IGST on the export and claim a refund of the same, you must:
- Pay IGST on the export invoice.
- Claim a refund of the IGST paid on exports through the GST refund process.
7. **Filing of GST Returns:**
- **GSTR-1:** Export transactions must be reported in GSTR-1. Make sure to mark these transactions as "Zero-rated supply" in the return.
- **GSTR-3B:** Report the zero-rated supplies and claim the refund of ITC in GSTR-3B.
8. **Reconciliation:**
- Ensure that all export transactions are accurately reconciled with the shipping bills and bank statements. Proper records of export invoices and supporting documents should be maintained.
### Summary of Procedures:
- **Issue Invoice:** For exports, issue invoices without charging GST, stating that the supply is zero-rated.
- **Claim Refund:** File a refund claim for ITC on inputs used in the export. Choose either to claim a refund of ITC under LUT or pay IGST and claim a refund.
- **File Returns:** Ensure accurate reporting of export transactions in GSTR-1 and GSTR-3B.
### Key Points:
- **No GST on Export Invoices:** Export invoices should not charge GST.
- **Refund of ITC:** You can claim a refund of ITC on inputs used for making zero-rated supplies.
- **Compliance:** Maintain proper documentation and ensure compliance with GST rules and procedures to facilitate smooth processing of refunds and avoid issues.
Always refer to the latest GST notifications and circulars for any updates or changes in the export-related procedures and ensure compliance with the GST law. Consulting a GST expert or professional can also help navigate the complexities of GST compliance for exports.
### Tax Treatment for Exports Under GST
1. **Zero-Rated Supply:**
- Exports are treated as **zero-rated supplies** under GST. This means that the supply of goods or services for export is subject to a GST rate of 0%.
2. **Invoicing for Exports:**
- When you invoice for an export, you should issue the invoice without charging GST. You must mention on the invoice that the supply is "Zero-rated supply" and quote the relevant section of the GST law (Section 16 of the IGST Act).
3. **Documentation:**
- Ensure proper documentation is maintained, including:
- **Export Invoice:** Should clearly state that it is a zero-rated supply.
- **Shipping Bill/Bill of Export:** This is required for export documentation and should be linked with the GST invoice.
- **Bank Realization Certificate:** Proof of receipt of foreign exchange, if applicable.
4. **Claiming Input Tax Credit (ITC):**
- **Refund of ITC:** As exports are zero-rated, you can claim a refund of the input tax credit (ITC) on inputs, input services, and capital goods used for making zero-rated supplies.
- **Refund Mechanism:** The refund of ITC can be claimed under either of the following methods:
- **Refund of ITC on Exports Without Payment of Tax:** This applies when no tax is charged on the export invoice.
- **Refund of ITC on Exports With Payment of Tax:** If GST has been paid on inputs and the export is made with tax payment, you can claim a refund of the tax paid on such inputs.
5. **Export Without Payment of Tax:**
- For exports without payment of tax, you must:
- Export goods or services under a bond or letter of undertaking (LUT) without payment of IGST.
- Ensure that the LUT is approved by the GST authorities and is valid.
6. **Export With Payment of Tax:**
- If you choose to pay IGST on the export and claim a refund of the same, you must:
- Pay IGST on the export invoice.
- Claim a refund of the IGST paid on exports through the GST refund process.
7. **Filing of GST Returns:**
- **GSTR-1:** Export transactions must be reported in GSTR-1. Make sure to mark these transactions as "Zero-rated supply" in the return.
- **GSTR-3B:** Report the zero-rated supplies and claim the refund of ITC in GSTR-3B.
8. **Reconciliation:**
- Ensure that all export transactions are accurately reconciled with the shipping bills and bank statements. Proper records of export invoices and supporting documents should be maintained.
### Summary of Procedures:
- **Issue Invoice:** For exports, issue invoices without charging GST, stating that the supply is zero-rated.
- **Claim Refund:** File a refund claim for ITC on inputs used in the export. Choose either to claim a refund of ITC under LUT or pay IGST and claim a refund.
- **File Returns:** Ensure accurate reporting of export transactions in GSTR-1 and GSTR-3B.
### Key Points:
- **No GST on Export Invoices:** Export invoices should not charge GST.
- **Refund of ITC:** You can claim a refund of ITC on inputs used for making zero-rated supplies.
- **Compliance:** Maintain proper documentation and ensure compliance with GST rules and procedures to facilitate smooth processing of refunds and avoid issues.
Always refer to the latest GST notifications and circulars for any updates or changes in the export-related procedures and ensure compliance with the GST law. Consulting a GST expert or professional can also help navigate the complexities of GST compliance for exports.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- TWO FIRM NAME IN ONE GST NUMBER
- ITR -1 Filing
- Section 54 f disallowed will be taxed at what rate
- Transportation of Petrol, Diesel by GTA and Other than GTA
- Trust 10AB form required for old asst. years?
- Eway issued more than one
- Rebate u/s 87A under old regime - LTCG u/s 112A
- SEA GOING ALLOWANCE
- Long term capital gain exemption on sale of mutual funds
- IGST Refund pending since June 2022.
- Pension Misclassification and Correction in Filed ITRs
- Gratuity payment criteria
- Procedure and Documents Required for Release of FD from DVAT
- How to rectify gstr1 credit note
- Non- payment of GST on supply of services- reg
- Other party gstin shown on my login id
- Accumulated surplus exceeding 15%
- Different GST Number MEESHO
- Query on TDS Section 194H
- Fees amount transfer procedure for two doctors
Trending Online Classes
CAclubindia
