GST Letter of Undertaking (LUT)

The user certifies in the letter of undertaking that all GST obligations have been satisfied. If an export is made without paying the IGST, it is given. Additionally, Central Tax Notification No. 37 (2017) You must offer LUT in order to export goods, services, or both without paying IGST. The exporter is required to pay the IGST or post an export bond if the LUT is not provided. LUTs could previously only be submitted in person at the relevant GST office. However, by making the LUT filing procedure available online, the government has improved accessibility.

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Table of Content

1. Get Started Today

2. LUT – Overview

3. When should a LUT be submitted?

4. How to file for LUT?

5. Consult An Expert

6. Client Testimonials

7. We’re Waiting To Help You

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LUT – Overview

Any registered taxpayer exporting products or services may use LUTs. Anyone who has been charged with tax evasion under the legislation for an amount of ?2.5 crore or more is ineligible to offer LUTs.

Such LUTs have a one-year expiration date (till the end of the financial year). An exporter who offers LUTs must offer fresh LUTs each fiscal year. The benefits are taken away and the exporter is forced to post bonds if the LUT requirements are not fulfilled in the allotted period.

Bonds should be issued to all other assesses in the event that the export is made without payment of the IGST (together with those who have been prosecuted for tax evasion of ?2.5 crores or more under the GST legislation). Online submission of letters of the undertaking is possible through the GST portal.

The bonds must also be physically completed because a hard copy needs to be provided to the department. The following transactions allow for the usage of LUT/Bonds:

• Supplies to SEZ that are zero-rated without IGST payment
• IGST must be paid on goods exported outside of India
• without paying the IGST when providing services to a client outside of India

When should a LUT be submitted?

A letter of undertaking needs to be filed/submitted online before exporting products or services. Previously, exporters were required to manually submit two completed and signed RFD-11 forms on business letterhead.

• One was sent to the jurisdictional deputy or assistant commissioner with oversight over their primary place of business, where the export documents were examined using the ICEGATE system.
• The other to the agency in charge of clearing customs.

Similar to the previous excise scheme, these cost exporters a lot of time and money to comply with. Finally, this process has been streamlined and rationalised to give all parties involved in an exporter’s entire export process transparency. Keep in mind that the bond must be manually submitted and provided on paper without a judicial stamp.

How to file for LUT?

Follow these steps to apply for LUT on the GST Portal/GSTN:
Step 1: Login to GST Portal account.
Step 2: From the ‘SERVICES’ tab > ‘User Services’, choose ‘Furnish Letter of Undertaking(LUT)’.
Step 3: Select the financial year for which the Letter of Undertaking is applied from the drop-down list next to “LUT Applied for Financial Year.” E.g., 2021-22.

Please upload the Letter of Undertaking using the ‘Choose File’ option on the same window if you have already manually submitted one for any of the prior financial year.

Make sure of the following:

The only allowed file types are PDF and JPEG.

The maximum upload file size is 2 MB.

Step 4: Complete the necessary information on the Letter of Undertaking Form/ GST RFD-11 that appears on the screen. The following fields on the form must be filled out:

(a) Self-Declaration By clicking on each of the three boxes, you can mark them.

(b) Give Independent Witnesses Information: Mention the two independent witnesses’ names, jobs, and addresses in the red boxes.

It is significant that the Witnesses indicated on the running Bond/Bank guarantee match those listed on the Letter of Undertaking (LUT).

Step 5: Choose a location for the file. Before submitting the form, double-check its accuracy by clicking “SAVE” > “PREVIEW.” Please be aware that at this time, forms that have been signed and submitted cannot be changed.
Step 6: Use one of the following procedures to sign and return the form.

The principal authorised signature or any other authorised signatories may both sign the Letter of Undertaking. Authorized signatures may include the Managing Director, the working partner, the Firm Secretary, the proprietor, or a person duly designated by the active partner or the Board of Directors of the company or proprietor to execute the form.

DSC Submission: Sign the application using the registered digital signature certificate of the authorised signatory.

Go to “SIGN AND FILE WITH DSC” > “SIGN AND FILE WITH DSC” to use this functionality. A caution message box displays. ‘PROCEED’> has been chosen. The system creates a distinct ARN (Application reference number).

OR

To use this option, select “SIGN AND FILE WITH EVC” > “Submit With EVC.” To the registered mobile phone number and email address of the authorised signatory, the system will issue an OTP. Type the OTP into the pop-up box, click “PROCEED,” and then click “Submit” to sign the application. Each business or limited liability partnership receives a special ARN (Application reference number)** created by the system. A confirmation message is received. The GST Portal sends this ARN to the Taxpayer’s registered email and mobile number by email and SMS.

By selecting the DOWNLOAD option, the acknowledgement can be downloaded. You can also view the previously published Letters of Undertaking on the GST website.

What does a LUT certificate in GST mean?

The official name and definition of LUT under GST is Letter of Undertaking. The exporter must certify in the form GST RFD 11 that they will abide by all GST rules while exporting without paying IGST in order to comply with rule 96 A.

What exactly is GST RFD 11?

supplying a bond or a letter of commitment to make exporting goods or services easier.

Is a LUT GST registration required?

In accordance with Central Tax Notification No. 37/2017, LUT is required in order to export goods, services, or both without having to pay IGST. The exporter is required to pay the IGST or post an export bond if the LUT is not provided. LUTs could previously only be submitted in person at the relevant GST office.

Using the GST portal, is it feasible to get a LUT certificate?

In order to access the GST Portal, use correct credentials >Click on the Services > User Services menu and choose the Furnish Letter of Undertaking (LUT) action.

Who must submit a LUT application under the GST?

All registered taxpayers must submit a LUT in Form GST RFD-11 on the GST Portal before undertaking a zero-rated supply of goods or services. Use legitimate login information to access the GST Portal.

What happens if the LUT isn’t submitted by the deadline?

If the LUT is not submitted, the exporter must first pay the necessary tax while exporting in order to be qualified for zero-rated exports before requesting a refund.

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