GST Registration

GST Registration

GST Registration is mandatory for every business having turnover of more than Rs. 40 Lakhs per annum. GST Registration is necessary for certain types of business. If a business is carried on without registering under GST, then it will be an offence under GST law. A casual taxable person/Non-Resident Taxable Person, e-commerce aggregator, agents of supplier and input service distributor etc. are required to register under GST. Moreover, Every GST taxpayer is given a unique identification number called GSTIN during the registration process.

Package inclusions:
  • Procedure for GST Registration
  • Advice regarding Documentation for GST Registration
  • Online Formal GST Registration Procedure
  • GST Registration Certificate
  • Liaising with the GST council for GST Registration
GST Registration

An Overview on GST Registration

GST is an abbreviation for Goods and Services Tax. Under section 279A of the Constitution of India, the GST council is formed. The GST council comprises of the Union Finance Minister, Union Minister of the State Revenue Minister and the Union Minister of Finance and Tax for the respective state councils. All the respective laws and rules which apply to GST registration for a business would be in the respective central and state websites.

This law was brought in 01 July 2017 with a view of removing all the other forms of indirect taxes in the country. GST applies to any form of service or products which are produced and manufactured in India. This would also apply to freelancers as per the new labour law amendments.

As a result of GST other forms of taxes such as VAT, Entertainment Tax, Sales Tax, Octroi have been combined and incorporated into one law. For every step in the supply chain, a specific amount of rate of GST is charged. The procedure for GST registration is completely an online process. Hence businesses would not have to go offline to carry out this form of registration.

GST Cycle

As mentioned earlier GST is levied on every stage of the process. The following cycle is utilised in GST:

  • Raw Materials;
  • Manufacturers;
  • Sale to Wholesalers and Retailers.

In the above list, when a product is introduced at the nascent stage, GST would be levied on raw materials. Similarly, when they are used in the manufacturing process, the same would be levied on manufacture. All the GST which is levied on the above two processes would be levied finally on the Sale to Wholesaler and Retailers.

Any business which has a specific amount of turnover annually would have to register as per the requirements of the government.

What are the benefits of GST Registration?

A business would get multiple benefits for registering under GST. Some of the common benefits are as follows:

  • Recognition-

    Businesses that have registered themselves with the requirements of GST would be recognised in the eyes of the law. Public and consumers will recognise businesses that have registered as per the requirements of the government.

  • Appropriate Accounting-

    Appropriate accounting cycles can be followed up by registering with GST authorities.

  • Benefits and Government Incentives-

    There are different forms of benefits and government incentives offered for businesses that perform GST registration.

  • Lower Tax Rates-

    If a taxpayer is having a turnover of less than Rs 1.5 crore per annum, then the taxpayer can choose for composition tax scheme. Under the composition tax scheme, there is an incentive to pay a lesser amount of tax.

  • Relief from Double Taxation-

    Any business that is registered with GST as per the government requirements would get reliefs and exemptions from double taxation.

  • E-Way Bill-

    By utilising this form of registration, a new system of logistics can be utilised through the E-Way Bill system.

  • Protection from Penalty-

    If your business satisfies the eligibility criteria for GST Registration then you must get registered under GST otherwise penalty and or fines may be levied.

What are the Components of GST?

There are three components of GST which are predominantly called:

  • Central Goods and Services Tax (CGST)
  • State Goods and Services Tax (SGST)
  • Integrated Goods and Services Tax (IGST)
  • Central Goods and Services Tax (CGST)-

    CGST is the amount of tax charged on the intrastate supply of different forms of goods and services. This is usually charged and levied by the Central Government. As per this, both the Central Governments and State Governments would combine their GST collections and share the revenue equally.

  • State Goods and Services Tax (SGST)-

    This is the amount of tax charged on the intrastate supply of different forms of goods and services. One of the key indicators is that the State Government charges this tax.

  • Integrated Goods and Services Tax (IGST)-

    The amount of tax which is charged on the interstate supply of different forms of goods and services is understood as integrated goods and services tax. Here again, the amount of IGST is collected and shared between the respective Central government and the State Government.

Which businesses or Entities require GST registration?

The following businesses require registering as per the requirements of the GST:

  • Businesses with specified threshold limit-

    Businesses whose Taxable Turnover is more than Rs 20 Lakhs in case of the supply of services or 40 lakhs in case of the supply of goods. The yearly turnover of the business is taken for taxation of GST.

  • Interstate Outward Supply-

    All businesses that make an interstate Outward supply of goods and services would have to compulsorily consider the process of GST registration.

  • E-Commerce Entities-

    Usually, e-commerce entities require considering GST registration especially persons supplying through e-commerce aggregator and every e-commerce aggregator. However, as per the recent notification e-commerce entities which have an annual turnover of lesser than Rs. 20 Lakhs per annum do not require to make any such registration.

Input Tax Credit (ITC) under the GST Regime

ITC or input tax credit allows you as a business owner to pay lesser taxes on the inputs of a specific amount of products. The main benefit of paying input tax credit is to reduce your tax liability on the products.

So usually when a business buys some form of product, then a specific amount of tax would be paid when the product is received from a seller who is registered. When the business pays the specific amount of tax, the same can be added to taxes paid at the time of purchase. Hence ITC would allow the registered business to consider adjustments.

Tax Rates for GST Registration

The Government has brought out different tax rates for GST registration process. These rates are likely to change as per the requirements of the government. A full list of the GST tax rates is present in the following link https://cbic-gst.gov.in/gst-goods-services-rates.html

The government levies the following rates:

  • Basic Necessities-

    No Amount of GST tax is levied on necessities.

  • House Hold Necessities and Drugs-

    A rate of 5% is charged on basic household necessities and drug applications.

  • Computer Products and Processed Food-

    A rate of 12% is charged on computer products and other forms of processed foods.

  • Hair Oil, Capital Goods, Raw Materials and Other forms of Industrial Goods-

    The rate of 18% is charged on consumer goods and capital goods which are used in different forms of industrial processes.

  • Luxury Items-

    The rate of GST charged on Luxury Goods stands at 28%. Luxury goods can be cars and other forms of goods which fall under the category of goods classified as luxury.

Eligibility Criteria for GST Registration

The following Eligibility Criteria has to be sufficed by the business for GST Registration Process:

  • Pre-GST Law-

    All entities that have been paying some forms of indirect taxes such as entertainment tax, sales tax and Octroi would have to go for GST registration.

  • Turnover Threshold-

    All businesses which have a turnover of more than a specific amount would have to go for GST registration process. Usually, a business which carries out the supply of services requires more than Rs. 20 Lakhs per annum and business which carries out the supply of trading and products would have to have an annual turnover of more than Rs. 40 Lakhs.

  • Resident Status-

    Every Casual Taxable individual or a Non-Resident taxable individual would have to go for the process of GST registration.

  • Agents-

    Any form of input service distributor and the agent of a particular supplier would have to consider the process of GST registration.

  • Reverse Charge Mechanism-

    Any business or individual that is paying some form of tax in the reverse charge mechanism form would also have to go for GST registration.

  • E-Commerce Entities-

    Any form of E-Commerce entity would have to go for the process of GST registration. However, any entity whose annual turnover is lesser than Rs. 20 lakhs per annum would not have to register under GST.

  • E-Commerce Aggregators-

    Every e-commerce aggregator must consider the registration of GST as a mandatory requirement.

  • Database Access-

    Any form of individual or a company providing data base access or some form of streaming system to a person resident in India have to register as per the requirements of GST.

Procedure for GST Registration (Online GST Registration)

GST Registration in India is completely an online process. This law was brought out in 2017; hence the government have made it automated in its functioning. The following steps have to be carried out for GST registration in India:

Procedure for GST Registration (Online GST Registration)
  • Login to the Website-

    The applicant has to login to the following website https://www.gst.gov.in/

     Then the applicant has to click on the services tab and click on GST Registration. After this, the applicant has to click on GST new registration. The applicant would be redirected to the portal, asking login information and details.

  • Fill in the Information-

    In the next step, the applicant has to fill in the information requested. This will include the name of the business entity, entity type and PAN information.

  • Include Email id and Mobile Number-

    In the next step, the applicant must include information such as Email Id and Mobile number. All future communications would be received through the email id and the mobile number.

  • Generate Temporary Reference Number (TRN)-

    Once all the information is put in by the applicant, an OTP (One Time Password) will be generated, and a TRN also would receive by the applicant. This TRN is known as the temporary reference number.

  • Input Details of Captcha-

    In the next step, the applicant would be required to input details of the TRN and the Captcha image, which is displayed. After this the applicant has to click on proceed.

  • GST Registration Page-

    In the next step the applicant would be redirected to another page known as the GST registration page. The applicant must submit all information related to the business. This will include all business information. The Date of commencement of the business must also be included in this form.

  • Fill in Details-

    All the information related to the promoters or directors must be provided. If it is a partnership firm then the information on the partners must be submitted. All the information related to the goods must be provided in the form. Any other additional place of business of goods must be provided in the application form.

  • Upload Required Documents-

    The applicant must upload all the documents of the business.

  • Save and Receive ARN number-

    In the final step the applicant has to save and submit the application to the concerned authority. The ARN number will be generated in the email and the SMS.

Penalty for Non-Compliance with GST Registration

The CBIC has issued a notification that not filing GST return by an entity would lead to strict penalties on the defaulter. Attachment of bank accounts of the defaulter would be one of the penalties incurred. Hence the applicant must file online mode of GST in appropriate form.

As per the CGST and SGST the penalty for non-compliance is Rs. 100 per day and a delay in such payment would lead to Rs. 200. The maximum amount shall be 5000 rupees. There is no late fee on IGST, if there is a delayed filing. It may be noted that along with the late fee under GST, interest shall also be charged @18%. It must be calculated by the taxpayer on the tax to be paid.

According to section 122 of the CGST act non-compliance with the rules related to GST registration can attract strict penalties.

Due Date for GST Returns

GST FORM FILING PERIOD DUE DATES
GSTR 1 Monthly 11th of every month
GSTR 3 Monthly Suspended
GSTR 3B Monthly and Quarterly 20th of every month and Quarterly 22nd of the month
GSTR 4 Annually 30th April of the year following the relevant financial year
GSTR 5 Monthly 20th of every month
GSTR 5A Monthly 20th of every month
GSTR 6 Monthly 13th of every month
GSTR 7 Monthly 10th of every month
GSTR 8 Monthly 10th of every month
GSTR 9 Annually 31st December of the year after the relevant financial year
GSTR 9A Annually Currently suspended
GSTR 9C Annually 31st December of the year after the relevant financial year
GSTR 10 Filed when registration is cancelled Within 3 months from the date of cancellation/cancellation order.
GSTR 11 Monthly 28th of the month after the month when inward supply is obtained

Documents required for GST Registration

The following mandatory documents are required for GST registration:

Sole Proprietorship

  • Information of the sole proprietor
  • PAN Card and Address Proof of the sole proprietor

Limited Liability Partnership

  • PAN card of the Limited Liability Partnership
  • LLP Agreement
  • Address Proof of the LLP
  • Partners Name and all Information

Private Limited Company

  • Certificate of Incorporation
  • Memorandum of Association and Articles of Association
  • PAN Card
  • Board Resolution Signed by the Directors
  • DIN number
  • Digital Signature Certificate
  • Registered Address of the Business
  • Identity Proof of all the Directors- Voter ID, Aadhaar Card, Bank Account Statement and Driving License.

Latest GST Updates

  • October 2020

    E-invoicing system related to GST where invoices are generated for a business with revenue of more than Rs. 500 crores. Previously only 8 lakh invoices were generated. After the introduction, more than 20 lakh invoices have been generated.

  • August 2020

    Registration of GST would only be granted if there is a complete physical verification of the business. This would only be carried out if the Aadhaar is not authenticated.

    MSME with GST would not require UAN for any form of interest subvention scheme.

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Frequently Asked Questions

Yes GST registration is mandatory for every business. The Government of India brought out the requirement of registration for businesses in India. Even businesses that utilised previous indirect taxation regime are required to follow GST registration.

Yes Micro, Small and Medium Enterprises have to register with GST. However, the basis of threshold would be considered for GST registration.

If a business operator has different forms of businesses operating in the country, then multiple GST registration can be considered. For example if the business is present in Delhi and Karnataka, separate state GST should be considered for both states.

Yes it is possible to obtain multiple GST registrations within one state. This would be possible for the business with different business verticals and products.

ARN is an abbreviation for application reference number. It is a conclusive proof that GST registration has been submitted to the GST portal.

Usually for the supply of services in a particular state, the threshold for GST would be 20 Lakhs. Businesses in Arunachal Pradesh, Assam, Meghalaya, Manipur, Mizoram, Nagaland, and Tripura must get a GST registration if their supply turnover exceeds Rs. 10 lakh.

Composition Scheme would be applicable for specific businesses which have the turnover more than a particular amount. Usually businesses which have a turnover of more than 50 lakhs can make an application for the composition scheme. Such taxpayers would pay a fixed percentage of its turnover and cannot avail of the benefits of input tax credit.

GST return filing is a document which contains all the information related to the taxpayer. This document would indicate the tax liability which has to be paid by the tax payer. The following details would be present on GST Return filing:

• Output

• Input

• Sales and Purchases

GSTIN is an identification number. Such number is considered as a unique identification number for verification. This number is allocated to the applicant to utilise the same in the portal.

GSTN is an abbreviation for Goods and Services Tax Network. It is a form of a section 8 company which is incorporated for non-for-profit. Such organisation provides smart solutions for the GSTN network for indirect tax requirements.

When a company goes for the process of GST registration, then this form of business would be required to carry out GST registration. E-commerce companies have to mandatorily carry out the processes and procedures related to GST registration. Hence B2B businesses would also be required to comply with the above requirements.

Casual taxable individuals are entities that do not have a specific place of business. Usually such businesses would be taking other forms of business such as supply of services and act as a form of a middleman.

Yes there are specific businesses that do not require to file GST returns:

• Businesses which have annual turnover of less than Rs. 40 Lakhs in case of a trading business

• Businesses which have an annual turnover of less than Rs. 20 Lakhs in case of service business

• Such businesses are exempt from the requirement of filing GST

Reverse Charge is a mechanism where the receiver of the goods is liable to pay the form of GST. This is usually the case, where the receiver is not a registered user under the system of GST.

Yes for exports a specific amount of IGST would be taxed. A specific amount of zero tax rates would be applicable for exports.

This would be the total amount of taxable income which is liable to be considered for the purposes of calculating the total amount of GST. This would be considered for the business for the rate of calculation of GST.

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