Letter of Undertaking (LUT) in GST — Export Without Paying IGST

To export without paying IGST you must have either a valid LUT or a bond in place. If you do not file an LUT (or bond), you can still export, but you must pay IGST on the export invoice and then claim it back as a refund — which blocks your cash until the refund is processed. Filing an LUT avoids that and is the route almost all exporters use.

Form RFD-11 is the prescribed form on the GST portal in which the Letter of Undertaking (or bond) is furnished. You reach it via Services → User Services → Furnish Letter of Undertaking (LUT). On submission an ARN is generated instantly and the LUT is auto-approved.

Yes. A single LUT covers export of goods, export of services and supplies to an SEZ unit or developer for authorised operations. Service exporters — IT firms, consultants, freelancers billing foreign clients — use the same RFD-11 as goods exporters.

Any registered person who intends to export goods or services, or supply to an SEZ, can file a simple LUT. The only disqualification is a person who has been prosecuted for an offence under the CGST/IGST Act or an earlier indirect-tax law where the tax evaded exceeds ₹2.5 crore — such a person must furnish a bond with a bank guarantee instead. For everyone else, the simple LUT is available.

Both allow zero-rated exports without paying IGST, but an LUT is a simple self-declaration filed online with no security or bank guarantee, available to nearly all exporters. A bond is required only from taxpayers disqualified from LUT (prosecution over ₹2.5 crore) or those directed by an officer, and must be backed by a bank guarantee — typically covering about one month of expected IGST. In practice the LUT route is used because it is free and instant.

No. A simple LUT requires no bank guarantee, security deposit or fee. A bank guarantee is required only in the bond route, which applies to taxpayers who are ineligible for the LUT.

Log in at gst.gov.in, go to Services → User Services → Furnish Letter of Undertaking (LUT), select the financial year, let your GSTIN and address auto-populate, tick the declaration confirming no prosecution over ₹2.5 crore, enter two witnesses (name, address, occupation), then sign with DSC (company/LLP) or EVC/OTP (proprietor/partnership) and submit. An ARN is generated instantly and the LUT is auto-approved.

An LUT is valid for one financial year — from 1 April to 31 March. It does not renew automatically, so you must file a fresh RFD-11 at the start of every financial year to keep exporting without paying IGST.

Yes. Because validity is limited to the financial year of filing, you should file a fresh LUT each year, ideally at the start of the financial year (from 1 April), so all your exports for that year are covered.

The government charges no fee to file an LUT on the portal — it is free. Any cost is only a professional fee if you engage a consultant to file and manage it for you.

Companies and LLPs must sign the LUT with a Digital Signature Certificate (DSC). Proprietorships and partnership firms can sign using EVC — an OTP sent to the registered mobile and email — so a DSC is not strictly required for them.

The invoice must state that it is a supply for export/SEZ under LUT without payment of IGST and quote the LUT ARN. For example: "Supply meant for export under LUT without payment of IGST. LUT ARN: [ARN]" for goods, or the equivalent wording for services or SEZ supplies. Report these in GSTR-1 Table 6A (exports) or 6B (SEZ) with the IGST amount as zero.

Because you charge no IGST, input GST accumulates as unused ITC. File Form RFD-01 on the portal, selecting "refund of ITC on account of zero-rated supplies without payment of tax (LUT/Bond)", ensure GSTR-1 and GSTR-3B are filed, upload export invoices and FIRC/BRC (services) or SEZ endorsement, and submit with bank details. A 90% provisional refund is generally issued within 7 working days and the final order within about 60 days.

Usually yes. CBIC circulars allow filing the LUT for a financial year even after exports have been made without IGST, treating those exports as covered. But if your GSTR-1 already reported the supplies as zero-rated without an LUT, an officer may issue a notice demanding IGST — so file the LUT promptly, respond with the LUT ARN and export documents (invoices, FIRC/BRC, shipping bills), and keep everything reconciled. Filing early each year avoids this problem.

No. The GST 2.0 rationalisation effective 22 September 2025 restructured goods and services rates into a two-slab system but did not change zero-rating of exports or the LUT/RFD-11 process. Exports remain zero-rated, LUT filing continues under Rule 96A, and the ITC refund route via RFD-01 is unchanged.