GST credit notes for post-sale discounts and refund changes from 1 November

CBIC Notification 03/2026–Central Tax, dated 26 October 2026, brought sections 153 to 155 of the Finance Act, 2026 into force on 1 November 2026. These provisions amend sections 15, 34 and 54 of the Central Goods and Services Tax Act, 2017.

Post-sale discounts: To exclude a qualifying discount from the taxable value, the supplier must issue a GST credit note and the recipient must reverse the input tax credit attributable to the discount in accordance with section 34. The revised section 15(3)(b) removes the earlier conditions requiring a pre-supply agreement and a specific link to the relevant invoices. Section 34(1) now expressly allows a credit note for these discounts. The usual credit-note reporting requirements still apply.

Refunds: Section 54(6) now extends the provisional refund framework to eligible claims for input tax credit accumulated under an inverted duty structure, subject to the applicable conditions and safeguards. Section 54(14) also removes the ₹1,000 minimum for tax refunds on goods exported with payment of tax. The exception applies to that export category.

Suppliers and recipients should coordinate credit-note reporting and retain a record of the corresponding credit reversal. Exporters and businesses with accumulated credit should review claims by refund category and confirm the applicable filing conditions before submission. The enacted text is available at https://egazette.gov.in/WriteReadData/2026/271439.pdf.