Eligibility Criteria for GST Registration

Ashish M. Shaji

05 Jan, 2021

GST is a Value-added Tax, it is a single indirect tax levy on manufacture, sale, import, and consumption of goods as well as services at the India level. It replaced a total of 15 indirect tax (both state & Central). In India, online GST Registration is simple and is entirely online process. Here, we will discuss the eligibility criteria for GST Registration.

Eligibility Criteria for GST Registration

According to section 22 of the CGST Act of 2017^[1], following persons are eligible for obtaining registration under GST:

• Supplier engaged in the exclusive supply of goods with the aggregate turnover in the financial year exceeded 40 lakh rupees.
• In case of special category states, supplier engaged in providing a taxable supply of goods are required to get registration under GST if the aggregate turnover exceeds20/10 lakh rupees in a financial year.
• The supplier who engages in providing a taxable supply of services if the aggregate turnover exceeds 20 lakh rupees in a financial year.
• In case of special category state, supplier engaged in providing a taxable supply of services if the aggregate turnover exceeds 10 lakh rupees in a financial year.
• Persons who are registered under the erstwhile law, on the day immediately preceding the appointment date.
• In case where the registered taxable person transfer business to another person on going concern basis, whether on account of succession or otherwise, the transferee or the successor should obtain the registration.

According to section 24 of the CGST Act of 2017, following persons are required to obtain compulsory registration under GST:

• Person engaged in interstate taxable supply of goods and services or both;
• Casual taxable person engaged in taxable supply;
• Persons liable to pay tax under the reverse charge mechanism;
• Non-resident taxable person engaged in providing taxable supply;
• Person liable to pay tax under section 9(5) of the Act;
• Person liable to deduct tax at source;
• Input Service Distributor;
• E-commerce operator;
• Person engaged in supplying goods or services or both through e-commerce operator who should collect tax at source;
• Persons engaged in supplying online information and database access or retrieval services from outside India to an unregistered person;
•  Persons engaged in taxable supply of goods or services or both on behalf of another registered taxable person, whether as an agent or otherwise.

What’s the Benefit of Registering a Business under GST?

Registration under GST would confer the following benefits:

• You would be legally recognized as a supplier of goods or services;
• Proper accounting of taxes paid on the input goods or services that can be used for GST payment due on supply of goods or services or both by the business;
• Legally authorized to collect the tax from his purchasers and pass on the credit of taxes paid on the goods or services to purchasers or recipients.

Conclusion

Read our article: Overview of GST on Advertisement Services and its Taxability