Inverted Duty Refund Calculator
Updated July 2026
Estimate your GST refund under an inverted duty structure using the Rule 89(5) formula, where input tax rates exceed output tax rates.
Inverted Duty Refund
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Frequently Asked Questions
What is an inverted duty structure?
When the GST rate on inputs (raw materials) is higher than the GST rate on the final output, ITC accumulates because output tax liability isn't enough to absorb the input credit — refund provisions exist to release this accumulated credit.
What is the Rule 89(5) refund formula?
Refund = (Turnover of inverted rated supply of goods and services × Net ITC) ÷ Adjusted Total Turnover, minus the tax payable on such inverted rated supply.
Are services included in inverted duty refund claims?
The formula was amended to be goods-and-services inclusive, but whether input SERVICES count toward "Net ITC" has seen litigation and rule changes — verify the current position before filing.