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Published on:
March 21, 2023
By
Harshini

Consumers/Unregistered persons can now file GST refund claim for cancelled contracts

No, consumers or unregistered persons cannot file a GST refund claim for cancelled contracts. The GST refund process is available only for registered taxpayers who have paid GST on input goods or services and are eligible to claim a refund.

However, as per the GST law, if a supplier has collected any amount as tax (including CGST, SGST, IGST or Cess) but fails to supply the goods or services, or if the supply is cancelled, the supplier is required to issue a credit note to the recipient of the supply. The credit note is used to reduce the amount of tax liability and can be adjusted against future tax liability or refunded.

In case the recipient is an unregistered person or a consumer, they can approach the supplier for the credit note to be issued to them so that they can claim a refund from the supplier.

It is important to note that the eligibility for claiming a refund depends on various factors, such as the nature of the supply, the time of supply, the amount of tax paid, and the provisions of the GST law. Hence, it is advisable to consult a qualified tax professional for specific guidance on GST refund claims.

Here are some additional details regarding GST refund claims for cancelled contracts:

As per the GST law, if a supplier has collected any amount as tax on a supply of goods or services, but fails to supply the goods or services, or if the supply is cancelled for any reason, the supplier is required to issue a credit note to the recipient of the supply.

The credit note is used to reduce the amount of tax liability for the recipient and can be adjusted against future tax liability or refunded. The recipient can claim a refund of the amount of tax paid on the cancelled supply, subject to the conditions specified in the GST law.

If the recipient is a registered person, they can claim a refund of the amount of tax paid on the cancelled supply by filing a refund application in Form RFD-01 within two years from the relevant date. The relevant date is the date of receipt of the credit note or the date of cancellation of the supply, whichever is later.

If the recipient is an unregistered person or a consumer, they can approach the supplier for the credit note to be issued to them so that they can claim a refund from the supplier.

However, it is important to note that the eligibility for claiming a refund depends on various factors, such as the nature of the supply, the time of supply, the amount of tax paid, and the provisions of the GST law. Hence, it is advisable to consult a qualified tax professional for specific guidance on GST refund claims.

FAQs

Sure, here are some FAQs on the topic of GST refund claims for cancelled contracts:

Q: Who can claim a GST refund for cancelled contracts?

A: A GST refund can be claimed by the recipient of the supply who has paid tax on the cancelled supply. The recipient must be a registered person and must have received a credit note from the supplier for the cancelled supply.

Q: What is the process for claiming a GST refund for cancelled contracts?

A: The recipient can claim a GST refund for cancelled contracts by filing a refund application in Form RFD-01 within two years from the relevant date. The relevant date is the date of receipt of the credit note or the date of cancellation of the supply, whichever is later.

Q: What documents are required for claiming a GST refund for cancelled contracts?

A: The recipient must submit a copy of the credit note issued by the supplier, along with other supporting documents such as the original tax invoice, proof of payment, and details of the cancelled supply.

Q: Is there any time limit for claiming a GST refund for cancelled contracts?

A: Yes, the recipient must file the refund application within two years from the relevant date.

Q: Can consumers or unregistered persons claim a GST refund for cancelled contracts?

A: No, only registered persons who have paid GST on the cancelled supply can claim a GST refund. Consumers or unregistered persons are not eligible to claim a GST refund for cancelled contracts.

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