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GST Refund Calculator.

Compute the RFD-01 refund for the two big unutilised-ITC scenarios — zero-rated exports without payment of tax under LUT (Rule 89(4)) and inverted duty structure (Rule 89(5), post-July-2022 formula) — with the caps, exclusions and the 2-year clock.

Refund scenario
Inputs (₹)
Turnover of zero-rated supply of goods (under LUT)
Exports + SEZ supplies made without payment of tax in the relevant period.
Value of like goods supplied domestically (0 if none)
Export goods turnover is capped at 1.5 × this value (Explanation to Rule 89(4)). Leave 0 if no like goods are supplied domestically.
Turnover of zero-rated supply of services
Payments received for zero-rated services, adjusted for advances per the rule.
Net ITC — inputs + input services
ITC availed on inputs and input services in the period. Capital goods ITC is excluded.
Adjusted Total Turnover
Taxable turnover (excl. exempt supplies other than zero-rated) + zero-rated services turnover, per the rule’s definition.
Result
Refund = (Turnover of zero-rated goods + services) × Net ITC ÷ Adjusted Total Turnover
Zero-rated goods turnover (declared)₹50,00,000
Cap — 1.5 × like domestic goods valueN/A
Goods turnover taken (lower of the two)₹50,00,000
+ Zero-rated services turnover₹0
× Net ITC ÷ Adjusted Total Turnover₹6,00,000 ÷ ₹80,00,000
Refund per formula₹3,75,000
Admissible refund₹3,75,000
GST work on CORAA

Refund files should be evidence, not spreadsheet archaeology.

CORAA ties refund workings to the GSTR-1 / GSTR-3B / 2B trail — turnover tie-outs, Net ITC cuts, deficiency-proof annexures — before RFD-01 goes in.

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How GST refunds of unutilised ITC are computed

Section 54 of the CGST Act allows refund of unutilised input tax credit in two situations: zero-rated supplies made without payment of tax (exports and SEZ supplies under a Letter of Undertaking), and inverted duty structure (rate of tax on inputs higher than on outputs). Both run through form RFD-01 with formulas prescribed in Rule 89 of the CGST Rules — the formula output, the Net ITC availed, and the balance in the electronic credit ledger together cap what is actually sanctioned.

Rule 89(4) for zero-rated supplies: Refund = (Turnover of zero-rated supply of goods + services) × Net ITC ÷ Adjusted Total Turnover, where Net ITC is the ITC availed on inputs and input services (capital goods excluded), and export goods turnover is taken at the declared value or 1.5 times the value of like goods supplied domestically by the same or similarly placed supplier, whichever is lower. Circular 197/09/2023 additionally clarifies goods value is taken as the lower of FOB per shipping bill and the tax invoice value.

Rule 89(5) for inverted duty (as amended by Notification 14/2022-CT dated 5 July 2022, on the GST Council's 47th-meeting recommendation): Maximum Refund = (Turnover of inverted rated supply × Net ITC ÷ Adjusted Total Turnover) − (Tax payable on inverted rated supply × Net ITC ÷ ITC availed on inputs and input services). Here Net ITC means ITC on inputs (goods) only. The amendment replaced the old formula's full deduction of output tax with a proportionate one, so ITC used from input services to pay output tax no longer eats the refund rupee-for-rupee. The change applies prospectively to applications filed on or after 5 July 2022 (Circular 181/13/2022).

Process: RFD-01 is filed online with statements and declarations; an acknowledgement (RFD-02) or deficiency memo (RFD-03) follows within 15 days. For zero-rated claims, a provisional refund of 90% can be sanctioned within 7 days (RFD-04), with the final order (RFD-06) due within 60 days. A deficiency memo is not a query — it voids the application, and a fresh RFD-01 must be filed with the limitation clock still running.

Worked example — exporter under LUT

In a tax period, an exporter makes zero-rated goods exports of ₹50 lakh under LUT (no like goods sold domestically), domestic taxable supplies of ₹30 lakh, avails Net ITC (inputs + input services) of ₹6 lakh, and has Adjusted Total Turnover of ₹80 lakh.

Inputs
Zero-rated goods turnover₹50,00,000 (1.5× cap N/A)
Net ITC (inputs + input services)₹6,00,000
Adjusted Total Turnover₹80,00,000
LUT (RFD-11)In force for the FY
Output
Refund = 50L × 6L ÷ 80L₹3,75,000
Provisional (90%) within 7 days₹3,37,500
Final order (RFD-06)Within 60 days
The zero-rated fraction of turnover (50/80) is applied to Net ITC of ₹6 lakh, giving ₹3.75 lakh. Capital goods ITC would be excluded from Net ITC. Since no like goods are supplied domestically, the 1.5× valuation cap does not bite. On a complete application, 90% can come provisionally in 7 days, and the balance with the final sanction order.

Common mistakes

Using the pre-2022 inverted-duty formula
Notification 14/2022-CT (5 July 2022) changed Rule 89(5): the deduction is now tax payable × (Net ITC ÷ ITC on inputs and input services), not the full output tax. Claims computed on the old formula understate the refund; the new formula applies to applications filed on or after 5 July 2022 — it is prospective, not clarificatory (Circular 181/13/2022), so older periods filed earlier cannot be recomputed.
Including capital goods (or input services, for 89(5)) in Net ITC
Net ITC under Rule 89(4) covers inputs and input services only — capital goods ITC is out. Under Rule 89(5) it is narrower still: inputs (goods) only; input services appear solely in the post-2022 apportionment ratio. Padding Net ITC with capital goods credit is one of the most common deficiency-memo triggers.
Ignoring the 1.5× like-goods valuation cap on exports
The Explanation to Rule 89(4) values zero-rated goods turnover at the lower of the declared value and 1.5 times the value of like goods supplied domestically by the same or similarly placed supplier. High export markups over domestic prices get haircut in the formula — and Circular 197/09/2023 adds the lower-of-FOB-and-invoice test.
Treating a deficiency memo as a query
An RFD-03 deficiency memo kills the application — you cannot rectify it. A fresh RFD-01 must be filed, and it must still sit within 2 years of the relevant date. Repeated deficiency memos near the limitation edge can extinguish the claim entirely, so file complete: statements, declarations, LUT reference, BRC/FIRC for services.

Frequently asked questions

How is GST refund calculated for exports under LUT?+
By the Rule 89(4) formula: Refund = (Turnover of zero-rated supply of goods + services) × Net ITC ÷ Adjusted Total Turnover. Net ITC is the ITC availed on inputs and input services (not capital goods) in the period. Zero-rated goods turnover is the lower of the declared value and 1.5× the value of like goods supplied domestically. The refund cannot exceed Net ITC or the credit-ledger balance at filing.
What is the inverted duty structure refund formula?+
Post 5 July 2022 (Notification 14/2022-CT): Maximum Refund = (Turnover of inverted rated supply × Net ITC ÷ Adjusted Total Turnover) − (Tax payable on inverted rated supply × Net ITC ÷ ITC availed on inputs and input services), where Net ITC is ITC on inputs (goods) only. The second term deducts output tax only in proportion to the input-goods share of credit.
What is the time limit for filing a GST refund claim?+
Two years from the "relevant date" under Section 54. For goods exported by sea/air, that is the date the ship or aircraft leaves India; by land, the date goods cross the frontier. For export of services, the later of receipt of convertible foreign exchange and the invoice date (where payment was received in advance). For inverted duty, the due date for furnishing the Section 39 return for the period in which the claim arises.
Is a LUT mandatory for exporting without paying IGST?+
Yes. A Letter of Undertaking in form RFD-11 (Rule 96A) must be furnished before exporting without payment of IGST, and it must be refreshed each financial year. Without a valid LUT, exports without tax payment expose the exporter to demand of IGST with interest, and the Rule 89(4) refund route presumes the LUT is in place.
What is the 90% provisional refund?+
For zero-rated supply claims, Section 54(6) allows a provisional refund of 90% of the claimed amount, sanctioned in RFD-04 within 7 days of the acknowledgement, subject to conditions (e.g. the claimant has not been prosecuted for evasion above the threshold in the preceding 5 years). The balance follows the final order in RFD-06, due within 60 days of a complete application.
What happens if I get a deficiency memo (RFD-03)?+
The application is treated as not filed. You must file a fresh RFD-01 after curing the defects — you cannot amend the old one. The fresh filing must still be within 2 years of the relevant date, so a late-cycle deficiency memo is a genuine limitation risk.
Which supplies cannot get an inverted-duty refund?+
Goods notified under Section 54(3)(ii) proviso — including specified edible oils and coal (chapters 15 and 27, Notification 09/2022-CT(Rate), effective 18 July 2022) — and construction services and other cases where credits are blocked under Section 17(5) (blocked credit never becomes Net ITC). Nil-rated and fully exempt outputs also do not create an inverted-duty claim.
Can I claim ITC refund if I claimed duty drawback?+
Not for the same taxes. Where drawback of central tax has been claimed, refund of ITC of central tax is barred (third proviso to Section 54(3)). Drawback limited to basic customs duty, however, does not block the GST ITC refund — the overlap test is tax-specific.

Authoritative sources

Section 54, CGST Act + Rule 89, CGST Rules — Rule 89(5) formula as amended by Notification 14/2022-Central Tax dated 5 July 2022; prospective application clarified by Circular 181/13/2022. Rule 89(4) valuation clarifications in Circular 197/09/2023. Restricted goods for inverted-duty refund: Notification 09/2022-CT(Rate).
Always confirm against the latest version of the source. Regulations evolve and amendments are common.
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Last reviewed: 2026-07-29 · For informational purposes only — not professional advice.