Letter of Undertaking (LUT) Filing Process
Scenario: You do remote work for a client outside India and raise invoices from India for software and IT services. You want to pay 0% GST on your services.
For that, you must furnish LUT (Letter of Undertaking) in Form GST RFD-11 before the export supply.
This is what LUT does
LUT is a declaration. It lets you export services without charging GST on your invoice.
But, there is a catch with LUT. If you do not meet the export conditions, you will have to pay GST plus 18% pa interest to the government.
Who needs to file LUT
You need to file LUT when all these points match:
- You have an active GST registration (GSTIN).(or you won;t be able to access the GST portal)
- You are an exporter of services and you do not want to charge GST on your export invoices. (The only reason to file LUT)
- You have no prosecution for tax evasion of Rs. 2.5 crore or more under GST or earlier indirect tax laws. (rarely happens)
Export of services: the 5 legal checks
Your service is treated as export of services when all five checks match:
- You are located in India.
- Your client is located outside India.
- Place of supply is outside India. (Automatically fulfilled in case of Indian freelancers and Remote Workers)
- Payment is received in convertible foreign exchange or in INR where allowed RBI.
- You and the client are not establishments of the same person. (Not relevant for Indian freelancers and Remote Workers)
When should you file LUT
You need to file LUT before you export services to foreign client.
Important option when filing LUT: Which financial year to select
File it for each financial year, starting from the current financial year.
Step-by-Step Filing Process (Form GST RFD-11)
Step 1: Open the LUT page
- Login to the GST portal.
- Go to: Services → User Services → Furnish Letter of Undertaking (LUT).
Step 2: Fill Form GST RFD-11
- Select the Financial Year.
- (Optional) Upload previous LUT.
- File format: PDF or JPEG
- Max size: 2 MB
- Tick all self-declaration checkboxes shown in the form.
- Enter details of two witnesses:
- Name
- Address
- Occupation
- Enter Place of filing LUT. (Should be the city of your GST registration)
- Select Authorised Signatory.
- Enter Place in the verification section.
Step 3: Preview, sign, and file
- Use SAVE to pause.
- Saved form stays in My Saved Applications for 15 days.
- Use PREVIEW to generate the PDF.
- Click SIGN AND FILE WITH DSC or SIGN AND FILE WITH EVC.
- For EVC, portal sends an OTP to the registered mobile number and email of the authorised signatory.
- After filing, portal generates an ARN and an acknowledgement.
- Download and store the acknowledgement and ARN.
Step 4: View your filed LUT
- Go to: Services → User Services → View My Submitted LUTs.
LUT status on the portal
You will see a status for your LUT submission. These are the portal statuses:
- Submitted
- Pending for Clarification
- Pending for Order
- Approved/ Deemed Approved
- Rejected
- Expired
Deemed Approved shows when no action happens within 3 working days after submission.
What to print on your export invoice
Your export invoice must carry this line:
SUPPLY MEANT FOR EXPORT UNDER BOND OR LETTER OF UNDERTAKING WITHOUT PAYMENT OF INTEGRATED TAX
Add this line to your invoice template. No need to add the LUT number
One rule you must track after LUT: payment receipt time
For export of services, you must track payment receipt for each invoice.
If payment is not received within six months from the invoice date or within an extended period allowed by the GST Commissioner, you must pay IGST plus interest within 15 days after that period ends.
Portal issue: LUT option disabled
A tax officer has the power to disable LUT filing for a taxpayer on the portal. The portal has no enable request button. You must contact your GST officer for it to be re-enabled.
Checklist for your records
Before the first export invoice of the year
- GSTIN active
- LUT filed in RFD-11 for the correct financial year
- ARN and acknowledgement saved
On each export invoice
- Export endorsement line printed on the invoice
After invoicing
- Payment receipt tracking per invoice
- Bank proof stored for receipt of funds
- One-year timeline tracked for each invoice under Rule 96A