Knowledge for IGST and refund procedure

[Guest]

Dear Sir,

I am a beginner in export. I am a merchant exporter i.e. I first get my product from a company and then export it to other customer. Now my query is that initially suppose i have purchased 100 rs product from a company situated in my state and they add 18% tax on it so the total becomes 118. Now I have already taken order from a foreign client including my profit and transportation charges at 150 rs , here suppose transportation charge is 10 rs , so now while exporting it through air by dhl express courier service they ask me about IGST i.e. whether IGST is paid or not. So following are my query for the above situation:-

1) Do i have to pay 18% IGST on 150 rs or on 140rs as the exporter will not pay it .

2) Do i get refund of total 18% tax that i have given to manufacturer and also which i pay later as IGST.

3) If i get refund what are the procedures for the same.

4) Is IGST need to be paid before exporting or at time of exporting or after exporting ?

Thanking you,

Arpit Jain

[KASTURI SETHI]

Whatever amount of applicable IGST you pay, you will get refund/rebate in full. IGST is to be paid before export i.e. at the time of issuance of invoice and other export documents.

[Ganeshan Kalyani]

Refund of input tax credit is eligible if export made without payment of IGST. If export made with payment of IGST then IGST paid is eligible as refund.

[Nash Industries I Pvt Ltd]

I agree to the views of both the experts.

Would like to add further,

Being a merchant exporter, procurement on 0.1% GST rather than 18%.

Regards

S.Ramaswamy

[Ganeshan Kalyani]

Yes, Sir i agree with you views.

AI Summary

IGST payment and refund: exporters can claim refund of IGST paid or recover input tax credit on exports. When export occurs with payment of IGST, the tax so paid on the export invoice is eligible for refund; when export is effected without payment of IGST, refund of accumulated input tax credit is available. IGST is to be discharged at or before issuance of the export invoice and related shipping documentation; refund claims follow the statutory refund procedure for either IGST paid or input tax credit utilisation depending on whether export was made with or without IGST payment.