---
title: "Interest on a delayed GST refund: when it starts and how to check it"
seoTitle: "Interest on delayed GST refunds: rate and start"
description: "Work out the interest due on a late GST refund, see which days are left out of the delay, find the interest in the payment order and know what to do if it is missing."
seoDescription: "When interest on a delayed GST refund starts, the 6% and 9% rates, which days are excluded, a worked example, and what to do if the interest is missing."
topic: "Interest on late refunds"
published: 2026-10-22
checked: 2026-10-22
order: 35
---

**If a refund is paid more than 60 days after you filed the complete application, interest of 6% a year is payable on the late amount for each day beyond those 60.** The officer orders the interest together with the payment order for the refund, and it is credited to your bank account. [CGST Act, section 56](https://www.indiacode.nic.in/indiacode/bitstream/123456789/15689/1/A2017-12.pdf#page=61); [CGST Rules, rule 94](https://cbic-gst.gov.in/pdf/01012020-CGST-Rules-2017-Part-A-Rules.pdf#page=97).

The example below is a refund of accumulated input tax credit (ITC) on exports of services under LUT. The same interest rules apply to other refund categories.

## Which interest rate applies?

| Situation                                                                                                                                                                                                    | Rate      | Interest runs                                       |
| ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------- | --------------------------------------------------- |
| The officer orders a refund that is not paid within 60 days of the application                                                                                                                               | 6% a year | From the end of those 60 days until the refund date |
| The refund arises from an order of an adjudicating or appellate authority, the Appellate Tribunal or a court that has become final, and is not paid within 60 days of the application filed after that order | 9% a year | From the end of those 60 days until the refund date |
| The Commissioner withheld the refund under section 54(11) while an appeal or other proceedings were pending, and those proceedings entitle you to it                                                         | 6% a year | From the date it was withheld until it is paid      |

Sources: [section 56 and its proviso](https://www.indiacode.nic.in/indiacode/bitstream/123456789/15689/1/A2017-12.pdf#page=61); [section 54(11) and (12)](https://www.indiacode.nic.in/indiacode/bitstream/123456789/15689/1/A2017-12.pdf#page=59); rates in [Notification 13/2017-Central Tax](https://gstcouncil.gov.in/sites/default/files/2024-04/notfctn-13-central-tax-english.pdf); the period for a withheld refund in the [GST Council's FAQs, refunds question 27](https://www.gstcouncil.gov.in/sites/default/files/2026-10/faqs_on_recommendations_made_in_57th_gst_council_meeting.pdf#page=20).

Interest on tax paid late is 18% a year under [section 50(1)](https://www.indiacode.nic.in/indiacode/bitstream/123456789/15689/1/A2017-12.pdf#page=53), set by the same notification. Practitioners have pointed out the gap: [CA Akshit Singhal](https://x.com/CAAkshitSinghal/status/2107793926019264769) contrasted the 18% charged on late tax with the 6% paid on late refunds, and [CA Ruchita Vaghani](https://x.com/R_N_Vaghani/status/1999484918498517223) made the same comparison.

## When does the 60-day count start?

The count starts on the date of filing of the complete application, not on the date the acknowledgement was issued. The acknowledgement, RFD-02, states that filing date. [CGST Rules, rule 90(2)](https://cbic-gst.gov.in/pdf/01012020-CGST-Rules-2017-Part-A-Rules.pdf#page=94).

After a deficiency memo (RFD-03) you file a fresh application, and its RFD-02 shows the filing date for that application. If you believe the memo was issued after the 15-day window or did not identify a real deficiency, have the start date reviewed before you accept a computation. The [RFD-03 and RFD-08 guide](/guides/gst-refund-deficiency-memo-rfd-03/) explains the memo itself.

## Which days are not counted?

Since 1 October 2023, rule 94(2) leaves these periods out of the delay:

- Time beyond 15 days after you receive an RFD-08 notice that you take to reply in RFD-09 or to submit further documents or a reply.
- Time you take to provide correct bank-account details, or to validate them, when the sanctioned refund could not be credited to the account you gave.

[Notification 38/2023-Central Tax, clause 14](https://gstcouncil.gov.in/sites/default/files/2024-05/gst-ct-38-2023.pdf#page=5).

Keep the documents that show each of these dates: RFD-02, any RFD-08 and your RFD-09 reply, and the bank credit.

## Example: work out the interest

All figures are invented. Suppose:

- RFD-02 shows a filing date of 10 March 2026.
- An RFD-08 notice arrives on 1 April 2026, and you file the RFD-09 reply on 26 April 2026, 25 days later.
- A refund of ₹3,00,000 is credited on 18 June 2026. No provisional refund was paid.

| Step                                                   |   Days |
| ------------------------------------------------------ | -----: |
| 10 March to 18 June 2026                               |    100 |
| Less the first 60 days                                 |    −60 |
| Less reply time beyond 15 days of the RFD-08 (25 − 15) |    −10 |
| **Days of delay**                                      | **30** |

Interest: ₹3,00,000 × 6% × 30 ÷ 365 = **₹1,479**, rounded to the nearest rupee.

Interest applies to the amount that was paid late. Rule 94 requires the order to state the amount of refund that was delayed. If ₹2,70,000 had been paid as a provisional refund within the 60 days, only the ₹30,000 balance was late: ₹30,000 × 6% × 30 ÷ 365 = **₹148**.

This example uses a 365-day year. The officer's order states the period and the amount actually computed. Compare it with your own working and ask about any difference.

## Where do I find the interest?

Rule 94 requires the officer to make the interest order together with the payment order in RFD-05. The order states the amount of refund that was delayed, the period of delay and the interest payable. [CGST Rules, rule 94](https://cbic-gst.gov.in/pdf/01012020-CGST-Rules-2017-Part-A-Rules.pdf#page=97).

On the GST portal, go to **Services → Refunds → Track Application Status**, open the application by its ARN and download its orders. A sanction order is not proof of payment. Check the bank credit separately, as the [refund stages guide](/guides/gst-refund-stages-timeline/) explains.

## What if the interest is missing or wrong?

1. Recompute the delay from the RFD-02 filing date, the date of the bank credit and any excluded periods.
2. Write to the jurisdictional refund officer. Give the ARN, your computation and a reference to section 56 and rule 94, and keep a dated copy.
3. If you receive an order that refuses interest or allows less, note the date it was communicated. An appeal under [section 107(1)](https://www.indiacode.nic.in/indiacode/bitstream/123456789/15689/1/A2017-12.pdf#page=85) must be filed within three months of that date. Have the remedy reviewed before the period ends.

The GST Council has recommended faster, system-based refund processing, which would shorten the time to a provisional refund once it applies. The recommendations do not change section 56; a separate recommendation concerns interest on refunds of pre-deposits paid for appeals. See [the Council's refund changes for service exporters](/guides/gst-council-refund-changes-service-exporters/).