GST Refund New Rules explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
GST refund law has moved a lot in the past year. Some changes already decide how your claim is processed today; others are in the Finance Act 2026 but do not apply until the government notifies a start date. Mixing up the two is the most common error in current refund advice. This page separates them, as on 30 September 2026.
In force: the substituted Rule 91(2) (from 01.10.2025) requires the provisional refund order in RFD-04 within 7 days of acknowledgement, based on system risk evaluation; s.13(8)(b) IGST (intermediary place of supply) was omitted from 30.03.2026, so intermediary services to foreign clients can now qualify as exports; GST 2.0 rates from 22.09.2025 created new inverted-duty credit. Enacted, not yet in force: the Finance Act 2026 amendments extending provisional refund to inverted-duty claims (s.54(6)) and removing the ₹1,000 minimum for exports of goods with payment of tax (s.54(14)). Both apply from a date to be notified, so check the notification status before relying on them.
At a glance
| Change | Status on 30.09.2026 | Effect on refunds |
|---|---|---|
| Rule 91(2) substituted: RFD-04 within 7 days, risk-based | In force from 01.10.2025 | Quicker provisional refund for zero-rated claims that clear system risk checks |
| IGST s.13(8)(b) omitted (intermediary services) | In force from 30.03.2026 | Intermediary services to foreign clients can be exports and claim refund |
| GST 2.0 rate structure (5%, 18%, 40%) | In force from 22.09.2025 | Rate cuts have left fresh inverted-duty credit in many sectors |
| s.54(6) extended to inverted-duty refunds (Finance Act 2026) | Enacted; awaiting notification | 90% provisional refund would become available for inverted duty |
| s.54(14) ₹1,000 minimum removed for exports of goods with payment of tax (Finance Act 2026) | Enacted; awaiting notification | Small IGST refunds on exports would no longer be dropped |
For how these change a claim you are about to file, our GST refund hub sets out each refund category.
1. Provisional refund in seven days, on system risk (in force)
Section 54(6) allows 90% of a zero-rated refund claim on a provisional basis. Rule 91(2), as substituted w.e.f. 01.10.2025, now says the proper officer, on the basis of identification and evaluation of risk by the system, shall issue the RFD-04 order within seven days from the acknowledgement under Rule 90.
Two limits remain:
- A proviso lets the officer, for reasons recorded in writing, decline the provisional refund and proceed to the final order under Rule 92.
- Rule 91(1) still bars provisional refund where the applicant was prosecuted, in the five years before the claim period, for an offence involving tax evasion above ₹250 lakh.
In practice, a clean claim that matches returns and GSTR-2B has the best chance of clearing the system checks. Our LUT export refund service prepares claims with that in mind.
2. Intermediary services: now exportable (in force)
Section 13(8)(b) of the IGST Act placed the supply of intermediary services at the location of the supplier. So an Indian intermediary serving a foreign principal could not treat the service as an export. The Finance Act 2026 omitted clause (b) w.e.f. 30.03.2026. Intermediary services now follow the default rule in s.13(2), generally the recipient's location.
Where the s.2(6) IGST export conditions are met, including receipt of payment in convertible foreign exchange (or in INR where RBI permits), the supply is zero-rated. That means LUT and an ITC refund under Rule 89(4), or export with IGST paid and a refund of that tax. This applies to supplies on or after 30.03.2026 only. Details are in intermediary omitted 2026: GST refund for exporters and intermediary services place of supply.
3. GST 2.0 and inverted duty (in force)
From 22.09.2025, the main slabs are 5% and 18%, with a 40% rate for specified goods. Where output rates came down but inputs did not, credit is now piling up. That is a Rule 89(5) refund under s.54(3)(ii), subject to the usual limits: no refund where output is nil-rated or fully exempt, input services and capital goods out of Net ITC, and the goods notified as ineligible. Check the current rate schedule for your goods before assuming a claim. See ITC accumulation after GST 2.0 rate cuts. Our inverted duty refund service handles these claims.
4. Finance Act 2026 amendments awaiting notification
s.54(6), provisional refund for inverted duty. The Finance Act 2026 extends provisional refund to refund of unutilised ITC under s.54(3) first proviso clause (ii), that is, inverted-duty claims. The ICAI Background Material (July 2026) records it as inserted w.e.f. a date yet to be notified. Until then, inverted-duty claims get no RFD-04; they go to the final order within 60 days.
s.54(14), ₹1,000 minimum. Today, no refund under s.54(5) or (6) is paid if the amount is under ₹1,000, applied per tax head (Circular 125/44/2019-GST). The Finance Act 2026 adds an exception for goods exported out of India with payment of tax. The same source marks it not yet notified. Until it is, small refunds still fall below the limit.
Our advice: these amendments are enacted, but check the notification status on the CBIC site before relying on them in a claim.
5. Recent changes still worth knowing
| Change | Date | What it means |
|---|---|---|
| Rule 94(2): applicant-caused delays excluded from interest | 01.10.2023 | Reply time beyond 15 days of RFD-08, and bank-detail delays, reduce the interest period |
| Rule 96(10) omitted | 08.10.2024 | The old bar on IGST-paid export refunds for exporters using certain import exemptions is gone |
| Rule 89(4A)/(4B) omitted; ATT and Net ITC wording aligned | 08.10.2024 | Notification 20/2024-CT |
| s.54(15): no refund where goods exported are subject to export duty | 01.11.2024 | Applies to both ITC refund and IGST-paid routes |
| GSTAT pre-deposit: further 10% | 01.11.2024 | Relevant if appealing a refund rejection |
| Gemini Edibles: SLP dismissed | 09.05.2025 | Entitlement to inverted-duty refund attaches when credit accumulates, not when the claim is filed |
Interest on late refunds is unchanged at 6% p.a., and 9% where the refund flows from an appellate or court order; see GST refund interest calculation.
Need help applying the 2026 changes to your claims?
Intermediary exporters now have a refund route, and inverted-duty claims from the GST 2.0 rate cuts are piling up. We check which rule applies to which period and file accordingly. Run a first figure in the GST refund calculator, then talk to us through the GST refund hub.
Key takeaways
- Provisional refund for zero-rated claims is now due within 7 days, on system risk evaluation (from 01.10.2025).
- Intermediary services to foreign clients can be exports for supplies on or after 30.03.2026.
- GST 2.0 rate cuts have created fresh inverted-duty refund claims.
- Provisional refund for inverted duty and the ₹1,000 carve-out for exports with tax are enacted but await notification.
- Always check the effective date of an amendment against the period of your claim.
Read next
- Provisional refund for inverted duty under section 54(6)
- Intermediary omitted 2026: GST refund for exporters
- GST refund rules list: Rule 89 to 97A
- How much GST refund will I get?
Disclaimer: Positions stated as on 30 September 2026, based on the CGST Act and Rules as amended, the Finance Act 2026, and the ICAI Handbook on Refunds under GST (January 2026). Verify current notifications before filing.