GST LUT filing for FY 2026-27 — exporters annual compliance checklist

GST LUT Filing for FY 2026-27: Exporters’ Annual Compliance Checklist

For exporters of goods and services, filing a Letter of Undertaking (LUT) is one of the most important annual GST compliances. A valid LUT enables eligible exporters to make zero-rated supplies without paying Integrated GST (IGST), helping businesses avoid unnecessary blockage of working capital.

Since an LUT remains valid only for one financial year, every exporter who wishes to continue exporting without payment of IGST must furnish a fresh LUT for FY 2026-27 before making export supplies in the new financial year.

This guide explains everything exporters need to know, along with a practical annual compliance checklist.

What is a Letter of Undertaking (LUT)?

A Letter of Undertaking (LUT) is a declaration filed in Form GST RFD-11 by eligible registered taxpayers. It allows exports of goods or services, and supplies to Special Economic Zones (SEZs), without payment of IGST.

Instead of paying IGST first and claiming a refund later, exporters can furnish an LUT and directly export without tax payment, significantly improving cash flow.

Why is LUT Important?

Filing an LUT offers several advantages:

Export without payment of IGST

Better cash flow management

No blockage of working capital

Easier refund of accumulated Input Tax Credit (ITC), where eligible

Reduced compliance burden compared to the IGST refund route

Who Can File LUT?

Generally, the following taxpayers can furnish an LUT:

Exporters of goods

Exporters of services

Businesses supplying to SEZ units or SEZ developers

Registered persons making zero-rated supplies

Eligible taxpayers can file LUT electronically on the GST portal instead of executing a bond, subject to the prescribed conditions under GST law.

Validity of LUT for FY 2026-27

An LUT is valid for one financial year only.

Therefore:

Financial Year: 2026-27

Validity: Up to 31 March 2027

A fresh LUT must be filed for every subsequent financial year if exports without payment of IGST are to continue.

When Should You File LUT?

Although GST law does not prescribe a fixed statutory due date, exporters should file their LUT:

Before issuing the first export invoice of FY 2026-27.

Before making any zero-rated supply without payment of IGST.

Delaying the filing may require exporters to pay IGST on exports until a valid LUT is furnished.

Documents Required

While filing LUT online, keep the following information ready:

GSTIN

Business details

Authorized signatory details

Witness details (where required)

Valid DSC or EVC for verification

The filing process is completely online, and physical submission is generally not required.

Step-by-Step Process to File LUT

Step 1: Login to GST Portal

Login using your GST credentials.

Step 2: Navigate to

Services → User Services → Furnish Letter of Undertaking (LUT)

Step 3: Select Financial Year

Choose:

FY 2026-27

Step 4: Furnish Declaration

Accept the prescribed declarations and provide the required details.

Step 5: Submit

Verify using:

DSC, or

EVC

Step 6: Download Acknowledgement

Save the ARN and acknowledgement for future reference and departmental verification.

Exporters’ Annual Compliance Checklist

Use this checklist every financial year:

✅ File a fresh LUT before the first export.

✅ Verify GST registration is active.

✅ Maintain export invoices with the prescribed export endorsement.

✅ Preserve shipping bills or Bills of Export.

✅ Keep Foreign Inward Remittance Certificates (FIRC) or Bank Realisation Certificates (BRC), wherever applicable.

✅ Reconcile export turnover reported in GSTR-1 and GSTR-3B.

✅ Match export invoices with shipping documents.

✅ Monitor realization of export proceeds within the prescribed timelines.

✅ Preserve LUT acknowledgement and ARN.

✅ Reconcile Input Tax Credit (ITC) before claiming refunds.

✅ Keep all export-related records for departmental scrutiny and audits.

Common Mistakes to Avoid

Many exporters face notices due to avoidable errors such as:

Using an expired LUT.

Filing LUT after issuing export invoices.

Incorrect reporting of zero-rated supplies in GST returns.

Mismatch between shipping bills and GST returns.

Incomplete export documentation.

Delay in filing refund applications.

Failure to reconcile export turnover with books of accounts.

What Happens if LUT is Not Filed?

If a valid LUT is not available:

Exporters may have to export on payment of IGST.

Working capital gets blocked until refund is received.

Refund procedures become lengthier.

Additional compliance and documentation may be required.

Best Practices for FY 2026-27

To ensure smooth GST compliance:

File LUT at the beginning of every financial year.

Reconcile GST returns every month.

Maintain complete export documentation.

Track realization of export proceeds.

Regularly review Input Tax Credit.

Preserve all GST acknowledgements and refund records.

Conduct periodic GST compliance reviews to identify mismatches early.

Conclusion

Filing a Letter of Undertaking (LUT) is an essential annual compliance for exporters who wish to export goods or services without payment of IGST. A fresh LUT for FY 2026-27 should be filed before the first export transaction to avoid unnecessary tax payments and cash flow disruptions.

By combining timely LUT filing with accurate GST return reporting, proper documentation, and regular reconciliations, exporters can remain compliant, reduce refund delays, and ensure smooth international business operations.