LUT & Export of Services: How to Invoice Without Charging GST

If you export goods or services and want to invoice without charging IGST, you need a Letter of Undertaking (LUT) — a declaration filed once a year on the GST portal that lets you supply for export, or to a Special Economic Zone, tax-free upfront. Without it, you have to pay IGST at export time and claim it back later, which is the same end result but with your cash tied up in the meantime.

What exactly is an LUT?

A Letter of Undertaking is filed as Form GST RFD-11 on the GST portal. It's a formal undertaking that you will comply with GST export requirements — essentially a bond, but without the bank guarantee that older export procedures required. Once accepted, it covers all your export supplies for that financial year, letting you invoice without charging IGST on any of them.

Why not just pay IGST and claim it back?

You can — it's the other valid route to the same zero-rated outcome, and it's what you'd fall back on before an LUT is in place. The difference is purely cash flow: paying IGST upfront means that money sits with the government until your refund is processed, which can take weeks. An LUT skips that entirely — no tax changes hands on the export in the first place, so there's nothing to wait on a refund for. This is exactly why most regular exporters file an LUT rather than rely on the refund route indefinitely.

Who's eligible to file one?

Most GST-registered exporters can file an LUT directly online, without needing prior approval from a tax officer. The main exclusion is a business that has been prosecuted for tax evasion involving an amount above a specified threshold — outside of that, eligibility is broad. If you're a regular freelancer, consultant, or exporting business without that history, you're very likely eligible.

How often do I need to renew it?

An LUT is valid for one financial year only. A fresh LUT needs to be filed at the start of each new financial year (1 April onward) before you continue making export supplies under it — an LUT accepted for one year does not automatically extend into the next. A surprisingly common mistake is continuing to export-invoice under a prior year's now-expired LUT reference simply because nobody set a reminder to refile it.

What changes on the invoice itself?

Instead of an IGST line, an export invoice made under LUT carries a specific declaration — typically something to the effect of "Supply meant for export under Letter of Undertaking without payment of integrated tax." Everything else about the invoice stays the same: your GSTIN, a consecutive invoice number, the customer's details, the description and value of what you're supplying, and — for a services export — the foreign currency and payment details, as covered in our invoicing international clients guide.

LUT vs. paying IGST and claiming a refund

Does this affect my ability to claim input tax credit?

No — exporting under LUT is zero-rated, not exempt, so you keep the right to claim input tax credit on GST you paid for business purchases that went into delivering the export, even though you charged no GST on the export itself. If any of this is unclear for your specific situation, it's worth checking directly on the GST portal or with a tax professional before filing.

What if I'm supplying to an SEZ instead of exporting abroad?

Supplying goods or services to a Special Economic Zone (SEZ) unit or SEZ developer for authorised operations is treated the same way as a physical export — it's a zero-rated supply under Section 16(1) of the IGST Act, even though the buyer is technically still in India. The same two options apply: supply under your LUT without paying IGST, or pay IGST and claim it back as a refund. The declaration on the invoice is slightly different, though — instead of the export wording above, it should read something like "Supply meant for SEZ unit/developer for authorised operations, under Letter of Undertaking without payment of integrated tax." You'll also want the SEZ recipient's valid SEZ registration details on hand, since that's what establishes the supply actually qualifies for zero-rating.

What about e-invoicing?

If your turnover puts you above the e-invoicing threshold, export invoices — including LUT exports — still generally need to go through the Invoice Registration Portal like any other B2B invoice. See our e-invoicing rules guide for the current threshold and process.

Once your LUT is filed, creating the actual export invoice is the same as any other invoice in QWIK INVOICE or the international invoice generator — just add the LUT declaration in the notes field and skip the tax line.