# LUT (Letter of Undertaking)

> A Letter of Undertaking (LUT) is a declaration an exporter files on the GST portal in Form GST RFD-11 so that goods or services can be exported, or supplied to an SEZ, without paying IGST. It is valid for one financial year and must be filed again each year.

In EaseDesk: On an export or SEZ invoice in EaseDesk you choose whether it is made with payment of IGST or under LUT. An invoice under LUT carries no tax, is marked as a zero-rated supply without payment of tax, and is reported that way in GSTR-1.

## Why it matters to your business

Exports are zero-rated under GST: no tax should stay in the price your foreign buyer pays. You can
reach that in two ways. Pay IGST on the export and claim it back, or file an LUT and export without
paying it at all. For most exporters the LUT is better for cash flow, because no money is locked up
waiting for a refund.

## How it works

As of October 2026:

- You file Form GST RFD-11 on the GST portal, under Services → User Services → Furnish Letter of
  Undertaking. It needs no bank guarantee and is accepted online.
- The LUT covers one financial year. Many exporters file it in March for the year that starts on
  1 April.
- Each export invoice under LUT states that it is a supply meant for export under a Letter of
  Undertaking without payment of integrated tax.
- Goods must leave India within three months of the invoice date, and payment for services must be
  received within the time the law allows. If not, the tax becomes payable with interest.
- The invoice is reported in [GSTR-1](/glossary/gstr-1) as an export without payment of tax, with
  the [shipping bill](/glossary/shipping-bill) details for goods.

## An example

A Tiruppur garment exporter ships an order worth USD 20,000 to a buyer in Germany. With an LUT on
file, the invoice carries no IGST. The exporter claims a refund of the [input tax
credit](/glossary/itc) on fabric and other purchases. Without the LUT, the exporter would first pay
IGST on the full value and wait for it to come back.

## Common mistakes

- Forgetting to renew the LUT in April and exporting on last year's.
- Charging no IGST on an invoice without an LUT in force.
- Leaving the shipping bill details off the return, which holds up the refund.

## Questions

### Who can file an LUT?

Any registered exporter of goods or services, and anyone supplying to an SEZ unit or developer, unless they have been prosecuted for tax evasion of more than ₹2.5 crore. Those who cannot file an LUT export under a bond with a bank guarantee instead.

### How long is an LUT valid?

For the financial year it is filed for. File a new one on the GST portal before your first export of each financial year; the reference number (ARN) you receive is what you quote.

### What happens if I export without an LUT?

You must charge and pay IGST on the export and then claim it back as a refund. That is allowed, but your money is blocked until the refund arrives.

### Do I still get input tax credit when I export under LUT?

Yes. Exports are zero-rated, not exempt, so you keep the credit on your purchases and can claim a refund of the credit that builds up.

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Source: https://www.easedesk.com/glossary/lut · Updated 2026-10-02 · EaseDesk