LUT FILING

Under the Goods and Services Tax (GST) regime in India, both ‘LUT’ (Letter of Undertaking) and ‘Bond’ play significant roles for exporters. Here’s a brief overview of each:

1. Letter of Undertaking (LUT):
   • LUT is a document furnished by an exporter to the tax authorities declaring that they would fulfill all the requirements and follow the rules and regulations under GST.
   • It is used for export of goods or services without payment of Integrated Goods and Services Tax (IGST).
   • LUT replaces the need for exporters to pay IGST at the time of export and claim a refund later.
   • Exporters who want to export goods or services without payment of IGST can submit an LUT instead of paying IGST and then claiming a refund.
2. Bond:
   • In cases where exporters are unable to furnish an LUT (usually due to specific conditions or if they are unable to meet the criteria set by the tax authorities), they need to provide a bond to the tax authorities.
   • This bond acts as a guarantee that the exporter will fulfill all the requirements and will pay the IGST in case of non-compliance.
   • It’s a legal undertaking that exporters make, backed by financial securities, to ensure compliance with GST laws.

Both LUT and Bond serve the purpose of facilitating exports under the GST regime by providing a mechanism for exporters to avoid upfront payment of IGST and streamline the export process.

To apply for LUT (Letter of Undertaking) or Bond under the Goods and Services Tax (GST) regime in India, exporters need to follow specific procedures outlined by the GST authorities. Here’s a general guideline on how to apply for LUT or Bond:

1. Applying for LUT (Letter of Undertaking):

• Eligibility: Not all exporters are eligible for LUT. Generally, exporters who have a clean track record of compliance with GST rules and have not been involved in any evasion or fraud are eligible.
• Online Application: Most applications for LUT are done online through the GST portal. Exporters need to log in to the GST portal using their credentials.
• Form GST RFD-11: Navigate to the ‘Services’ tab on the GST portal and select ‘User Services.’ Then, click on ‘Furnish Letter of Undertaking (LUT)’ and fill out Form GST RFD-11.
• Document Submission: While applying, exporters need to upload supporting documents such as bank details, GST registration certificate, and other required documents.
• Verification: After submission, the application is verified by the GST authorities. If everything is in order, the LUT is issued, usually within a few days.

2. Applying for Bond:

• Eligibility: Exporters who are not eligible for LUT or those who are required by the authorities to provide a bond need to apply for a bond.
• Offline Application: Unlike LUT, the application for a bond might involve offline procedures. Exporters should inquire with their jurisdictional GST office for specific requirements.
• Bond Format: The format of the bond may vary depending on the requirements of the GST authorities. Usually, it involves providing a legal undertaking along with financial securities.
• Submission: Once the bond is prepared as per the required format, it needs to be submitted to the designated GST office.
• Approval: The GST authorities will review the bond application and, upon approval, the exporter can proceed with their export activities.

It’s important for exporters to ensure that they meet all the requirements and provide accurate information while applying for LUT or Bond to avoid any delays or complications in the export process. Additionally, specific procedures and requirements may vary slightly depending on the jurisdiction and the nature of the export transactions, so exporters should stay updated with the latest guidelines from the GST authorities.