An LUT for export of services lets you invoice foreign clients without paying IGST upfront, so working capital is not stuck in refunds. Exports are zero-rated under GST. A Letter of Undertaking is the practical way most IT companies, agencies and freelancers use that benefit.
Key takeaways
- File Form GST RFD-11 on the GST portal; it is usually accepted immediately.
- An LUT is valid for one financial year — file the next one before the first export of that year.
- For services, foreign exchange (or RBI-permitted INR) must arrive within RBI timelines.
- Without an LUT you pay IGST first and wait for a refund.
What is an LUT?
An LUT is an undertaking filed in Form GST RFD-11 in which the exporter promises to fulfil export conditions. In return, the exporter can supply goods or services abroad, or to SEZ units, without paying IGST. Filing360 files this as GST LUT filing.
Who can file an LUT for export of services?
Any GST-registered exporter of goods or services can file an LUT, except a person who has been prosecuted for tax evasion of more than ₹2.5 crore. This covers IT companies, freelancers, consultants, digital agencies, manufacturers and traders. Freelancers should also read GST for freelancers.
Two ways to export under GST
| Option | How it works | Cash flow impact |
|---|---|---|
| With LUT | No IGST charged on export invoice | No blocked funds |
| Without LUT | Pay IGST on export, then claim a refund | Funds blocked until refund |
Documents needed
- GSTIN and PAN
- Authorised signatory details and DSC or EVC
- Import Export Code (IEC) for exporters of goods
- Name, address and occupation of two independent witnesses
Step-by-step: how to file an LUT online
- Log in to the GST portal.
- Go to Services → User Services → Furnish Letter of Undertaking (LUT).
- Select the financial year for which the LUT is being filed.
- Answer the declaration questions and enter witness details.
- Sign with DSC or EVC and submit. The LUT is generally accepted immediately and an ARN is generated.
Validity and conditions
- An LUT is valid for one financial year. File the next year’s LUT before the first export of that year, ideally by 31 March.
- Goods must be exported within 3 months of the invoice date.
- For services, payment must be received in convertible foreign exchange (or INR where RBI permits) within RBI timelines.
- If conditions are not met, IGST becomes payable with interest.
What to write on the export invoice
“Supply meant for export / supply to SEZ unit or SEZ developer for authorised operations under Letter of Undertaking without payment of IGST”, along with the LUT ARN.
Refund of unutilised ITC
Exporters under LUT can claim a refund of accumulated input tax credit through Form GST RFD-01.
LUT versus paying IGST — a cash example
An agency invoices a US client ₹10 lakh in a month. With an LUT, the invoice carries nil IGST and the ₹1.8 lakh that would have been tax stays in the current account. Without an LUT, ₹1.8 lakh goes out as IGST and comes back only after an RFD-01 refund — weeks or months later. That is why an LUT for export of services is the default once you are registered and the export tests are met.
Conditions that trip people up
Payment must land in convertible foreign exchange (or RBI-permitted INR). A friend’s NRE account, a crypto wallet or an Indian-company group recharge does not magically make it an export. The client must not be merely your own foreign branch. File the next year’s LUT before 1 April if you will invoice in April — an LUT is not automatic.
What to do this week
- If you are GST-registered and already exporting, confirm this FY’s LUT ARN exists.
- Put the LUT declaration and ARN on every export invoice template.
- If you are not registered yet but foreign receipts plus Indian fees will cross ₹20 lakh, register first, then file the LUT — see GST for freelancers.
Worked scenario
A Pune SaaS firm invoices Ireland on the 5th of each month. They file the LUT on 28 March so 1 April invoices are covered. The invoice quotes the ARN and the zero-rated declaration. Bank advice in USD hits within RBI time. A freelancer who files the LUT in August cannot cover April–July exports with that LUT — those months need IGST-and-refund or a harder conversation if they already issued nil-tax invoices. That is the operational meaning of LUT for export of services.
Related reading: GST for freelancers and LUT filing.
Filing360 files Form RFD-11 the same day we have GSTIN, signatory and two witnesses, then puts the ARN on your export invoice template. If you also have unutilised ITC, we line up RFD-01. That is the full LUT for export of services workflow, not just a portal click.
Frequently asked questions
Is LUT mandatory for exporters?
No, but without it you must pay IGST first and wait for a refund.
Can an LUT be filed after exports have started?
Yes, it can be filed later in the year, but exports made before filing will not be covered.
Do freelancers on Upwork need an LUT?
If you are GST-registered and export services, an LUT lets you invoice foreign clients without GST.
Do I need IEC to file an LUT for services?
IEC is essential for goods exporters. Pure service exporters file LUT with GSTIN, signatory and witnesses. Keep bank FIRCs; they prove the foreign-exchange condition.
Exporting services or goods? File your LUT with Filing360.
