What is the Letter of Undertaking underneath GST?
Letter of Undertaking is the document that the user provides declaring fulfillment of all needs underneath GST. It is equipped just in case of export undertaken without paying IGST. Also, in line with the Notification No. 37 /2017 – Central Tax it is necessary to furnish LUT to export merchandise or services or each without paying IGST. If the exporter fails to produce the LUT, then he needs to pay IGST or offer an export bond. Earlier LUT might solely be filed offline at the involved GST workplace. However, to more ease the method the Government has created the LUT filing on-line. In this article let us briefly see about the LUT Registration in tambaram, Chennai
What are the eligibility criteria to use for LUT?
A person aspiring to provide goods/services
- To or outside India or
- Places coated underneath Special Economic Zone
- Without paying integrated tax and
- Is also registered underneath Goods and Services Tax
An individual is eligible to use for LUT if the below-mentioned conditions are consummated
- There has never been the prosecution of the person underneath the Central Goods and Services Tax Act (CGST) or the Integrated Goods and Services Act (IGST) 2017 or the other existing laws. Where, the quantity of tax levied exceeds Rs. 250 lakhs.
- The LUT shall be provided on the stationery of the person registered underneath Goods and Services Tax. It ought to be equipped in duplicate for a financial year. LUT is given within the annexure to make GST RFD-11 and might be issued by the partner, MD, Company Secretary or by the person punctually signed by the corporate or the businessman.
- If an individual fails to pay the tax in the stipulated time as mentioned underneath the Central Goods and Services Act, the power of commerce without payment of IGST is withdrawn until it’s paid.
The jurisdiction for the submission of LUT
The LUT shall be accepted by the Assistant or Deputy Commissioner having Jurisdiction over the place wherever the exporters will do his business. A Tax Consultant in Chennai says that until any specific body officer is assigned the Exporters may furnish the LUT before any central or state officer.
Documents required for LUT registration in Chennai
- Entity’s PAN Card
- KYC of Authorizedperson.A Copy of PAN card and Aadhar card of partners/directors
- GST Registration
- IEC Certificate
- Cancelled cheque
Process of Filing LUT Registration in tambaram, Chennai(Letter of Undertaking)
1. Login to https://services.gst.gov.in/services/login
2. Click on the services tab and thereunder choose the User services and also the choose Furnish LUT
3. Under the “LUT applied for financial year” choose the year you wish to file your LUT for.
If your LUT for the previous amount is equipped offline, then you’re needed to connect it by clicking select file as shown on the screen below and continue.
4. Fill the main points in the form showing on the screen. Then you need to tick mark by clicking against the 3 boxes. By doing this, the exporters undertakes
- Export of products are done inside 3 months from the date of issue of export invoice or this point is also extended if allowed by the Commissioner.
- The exporters must abide by GST law in respect of exports.
- To pay Integrated tax beside Interest if didn’t export.
*Interest should be paid at the speed of eighteen once a year for the amount From the date of issue of export invoice up to the date of payment of integrated taxes
5. Mention witnesses for generating LUT
Independent Witnesses Information: Fill the name, Occupation, and address of 2 freelance witnesses within the boxes highlighted here. Witnesses of the LUT must be declared on running bonds/ Bank guarantee
6. Preview Letter of Undertaking (LUT)
Enter Place of Filing your LUT underneath the place of filing LUT then click on SAVE when saving your document you will be able to preview your Document by clicking on the preview to verify the shape before submission
7. Signing of Letter of Undertaking
File the after you sign it.
1. The Exporters or the other approved signatory will sign the Letter of Undertaking
2. Approved signatories embrace partners, MD or company Secretary or the businessman or the other person approved by these folks.
We can sign the application with a Digital Signature Certificate of the approved person. Click on the ‘Sign and file with DSC’ a warning message box seems, click on PROCEED button. Then the system provides the applying reference variety
We can additionally submit with EVC: Click on ‘Sign and file with EVC.’ Then you will receive an OTP to your registered mobile number; you will additionally get an email notification. Enter the OTP in the pop-up message post which you will receive a warning box before submission. You would like to click on PROCEED to induce your application reference variety.
*LLPs and corporations will solely use DSC for filing
8. Obtaining LUT confirmation
Then you’ll get an email notification and SMS to your registered mobile variety.
9. Transfer your GST Letter of Undertaking
You can currently transfer your acknowledgment by clicking on the transfer choice
Validity of LUT (Letter of Undertaking)
The LUT submitted is valid for the full year FROM which it’s submitted. You must submit a brand new LUT for every year. If the products for export don’t seem to be exported within 3 months of Date of Invoice issue, then the exporters are at risk of paying GST beside 18% interest within fifteen days in line with Section 50 (1). Additionally, just in case payment for services doesn’t seem to be received within one year that the LUT has been submitted, the exporters are at risk of paying GST @ 18% within fifteen days. Failing to try and do so can result in withdrawal of the LUT facility and on later payments, it can be restored.
You can transfer the form GST RFD-11 from web.cbec.gov.in as long as it is offered on the portal. Furnish the filled form to the territorial Deputy/Assistant Commissioner with jurisdiction over your home of business.
Document of LUT (Letter of Undertaking)
Self-declaration that the conditions of the Letter of Undertaking shall be accepted unless there’s specific permission granted. In such cases, a self-declaration is needed by the exporters to the impact that he has not been prosecuted ought to serve the aim of notification- 37/2017- Central Tax on fourth Oct 2017. Verification if needed is also applied on a post-facto basis.
Time for acceptance of LUT/Bond
As LUT or Bond is necessary for export business, together with exports to an SEZ unit, therefore it ought to air the highest priority list. The LUT/ Bond ought to be accepted inside 3 operating days when it’s been received beside the self-declaration by the exporters as mentioned on top of. Failing to method the LUT inside 3 operating days, it shall be thought-about to be accepted.
In all cases, bonds shall be in the course of a bank guarantee quantifying to 15% of the bond amount
Sealing by officers
In case of self-sealing, protection of containers is to be exercised under the direction of the central excise officer having jurisdiction over the place of business. A replica of the report is to be submitted to the Deputy/ Assistant Commissioner having jurisdiction over the place of business.
Purchases from Manufacturer
There aren’t any provisions for issuing of CT-1 type that permits exporters to get merchandise from makers without paying tax underneath the GST regime. The dealing between the manufacturer and also the exporters is like provide, and also the same would be subject to GST
Transactions with EOUs (Export Oriented Units)
Zero rating doesn’t apply to EOUs, and there’s no special exemption for them underneath the GST regime. Thus they are ratable just like the other ratable provides. To the extent of exports, Export Oriented Units are eligible for zero-rating.
Benefits of LUT registration
1.Exports while not tax payment
By filing LUT below GST, a businessperson will export merchandise or services while not paying the taxes. If LUT isn’t filed, the businessperson should initially pay the desired tax whereas creating exports so claim a refund to avail advantages of zero-rated exports.
The regular exporters are at an enormous profit by filling LUT on-line because the refund method may be a long method. Throughout that the bunch of capital is blocked in the form of a due refund. With this mode, the capital is unengaged to be used for different necessary needs. It conjointly reduces the price of exports.
3.An Entire twelve month Validity
The LUT, once filed is valid for the full twelve months within which it’s filed. Hence, in contrast to the refund method, a businessperson doesn’t have to be compelled to bear the procedural needs whenever an export consignment is meted out.
4.Simple and on-line method
The filing of LUT and its acceptance, each are created on-line since Apr, 2018. The person doesn’t need to visit the officers for acceptance. The full method may be completed on-line by submitting many needed documents.
Contact Pheonixtax- tax consultant for LUT Registration in tambaram, Chennai