Letter of Undertaking is Called LUT. The Letter of Undertaking is a record filed by the exporter so as to export services or goods without the payment of taxation. In the event the LUT isn’t registered, the exporter will export by payment of IGST then claim the refund of taxation. Filing LUT is more convenient compared to refund mode since the exporters don’t want to gratify in hassles of recurrence and obstruct their capital. The qualification criteria to use for LUT is relatively relaxed compared to erstwhile system.
Letter of Undertaking is registered online with the form GST RFD 11. By submitting LUT, the exporter Advantages of Submitting LUT under GST
Exports without tax payment
By submitting LUT beneath GST, an exporter may export services or goods without paying the taxes. If LUT isn’t registered, the exporter should first pay the necessary tax whilst making exports and claim a refund to avail advantage of zero-rated exports.
Saves Working Capital
The normal exporters are in a enormous advantage by submitting LUT online as the refund procedure under a different route is a time-consuming procedure. Throughout which the group of funds is blocked in the kind of a due refund. With this manner, the funds is liberated to be used for other essential conditions. Additionally, it cuts the price of exports.
An Entire Financial Year Validity
The Letter of Undertaking, after registered is valid for the entire financial year in which the filing is done. Therefore, unlike the refund procedure, an exporter doesn’t have to experience the procedural demands whenever that an export consignment is performed.
Simple and online process
The submitting of LUT and its approval, both are created on line since April 2018. The applicant doesn’t have to pay a visit to the officers for approval. The entire procedure can be performed on the internet by submitting a couple of required documents.
That all the requirements prescribed for this course will be fulfilled by him
Eligibility for Export under LUT
All GST registered products and service exporters are entitled to submit LUT except the exporters that were sued for any offence and the quantity of tax evasion surpasses Rs.250 lakhs below the CGST Act or the Integrated Goods and Services Tax Act,2017 or some of the present legislation.
In these instances, where the exporter isn’t qualified to document LUT, they’d need to provide an export bond.
Procedure for Filing Online LUT under GST
As stated previously, the filing of LUT was made on the internet via the GST Portal. Follow the steps given below:
- Login into the GST Portal with legitimate credentials.
- Visit menu bar and choose ‘Service’ option. Under ‘Service’ option visit ‘User Service’ option’ and pick the Tab “Furnishing List of Undertaking”.
- Currently, Type GST RFD-11 is exhibited.
- Select the Financial Year for which interval you want to supply the LUT.
- In case you’ve already supplied LUT Offline, for past period, please join the exact same here and continue to document your own application.
- If you are filing LUT, please browse and choose all of the three check boxes for taking the requirements prescribed in the Letter of Undertaking.
- In name, address and occupation of the individual witnesses segment, input the name and speech of 2 witnesses.
- From the Location field, enter the area where the form is registered.
- Next thing would be to select title of Main Licensed signatory or other Licensed signatory, that will sign the Application form.
- You may click on the PREVIEW button to preview the shape.
- It’s possible to click on the SAVE button to store the form and then recover later.
- After signed and registered, Form can’t be edited. Kindly recheck at least once prior to registering and filing.