Who and When should register for GST?

Goods and Services Tax or GST has been implemented in India from 1st July 2017 and it replaces several indirect taxes like Service Tax, VAT, Excise etc which were levied earlier. Many people are in confusion that who should register for GST? when should register for GST? etc. So I am here to answer those questions in a simple and easy way.

As per sec 22 of the CGST/SGST Act 2017, “every supplier is liable to be registered in the State/ Union Territory from where he makes a taxable supply of goods and/or services if his aggregate turnover in a financial year exceeds the threshold limit”. The threshold limit for a person making exclusive intra-State taxable supplies of goods is as under: –

  1. Rs. 10 lakhs for the States of Mizoram, Tripura, Manipur and Nagaland.
  2. Rs. 20 lakhs for the States of States of Arunachal Pradesh, Meghalaya, Puducherry, Sikkim, Telangana and Uttarakhand.
  3. Rs. 40 lakhs for rest of India.

The threshold limit for a person making exclusive taxable supply of services or supply of both goods and services is as under: –

  1. Rs. 10 lakhs for the States of Mizoram, Tripura, Manipur and Nagaland.
  2. Rs. 20 lakhs for the rest of India.

Exemption from GST Registration

The following class of taxpayers are not required to register for GSTIN:

  1. Person supplying agricultural produce from cultivation.
  2. Person making only exempt supplies (Nil rated or Non-taxable supplies) of goods or services.
  3. People making supplies which are entirely covered under Reverse Charge.

What are the benefits of GST Registration?

All the people who are registered under the GST Act are easily entitled to the following benefits :

  1. Legally recognised as a supplier of goods or services.
  2. Proper accounting of taxes paid on the input goods or services which can be utilised for the payment of GST due on supply of goods or services or both.
  3. Legally authorised to collect tax from his purchasers and pass on the credit of the taxes paid on the goods or services supplied to purchasers or recipients
  4. Getting eligible to avail various other benefits and privileges rendered under the GST Laws.

GST Registration is also mandatory in the following cases:

  1. Service Provider
  2. Agent for Registered Person
  3. Casual Taxable Person
  4. Input Service Distributor
  5. TDS/ TCS Deductor
  6. E-Commerce operator
  7. OIDAR – Online Information & Database Access Retrieval Service provider supplying services from outside India to a Non registered person in India

Types of GST registration

  1. Normal taxpayers

Most businesses in India fall under this category. In a given financial year , all the businesses whose turnover exceeds Rs 20/ 40 lakh are required to register as a normal taxable person . However, the threshold limit is Rs 10 lakh if you have a business in Mizoram, Tripura, Manipur and Nagaland.

  • Casual taxable individual

Occasional or seasonal businesses need to register their businesses under GST for this category. Businesses need to make a deposit equal to the GST liability from the occasional operations. The tenure for registration is 3 months. However, businesses can apply for renewal and extensions.

  • Non-resident taxable individual 

Individuals who reside outside India but occasionally supply goods or services as agents, principals, or in other capacities to Indian residents are liable to file for registration under this category. The business owner must pay a deposit equal to the expected GST liability during the GST active tenure. The normal tenure is 3 months, however, the individuals can extend or renew the registration if required.

  • Composition registration

Businesses with an annual turnover as prescribed are eligible for registration under the composition scheme. Under this scheme, businesses have to pay a fixed amount of GST irrespective of their actual turnover. 

When should you Register for GST?

A person should apply for GST Registration within 30 days from the date on which he became liable to register for GST; the Casual and Non Resident Taxable persons have to register for GST at least 5 days prior to the commencement of business in India. For transferee of a business as going concern, the liability to register arises on the date of transfer.

  • If the application is submitted within 30 days from the date on which the person becomes liable to registration – the effective date of registration shall be considered as the date on which he had applied for registration.
  • The effective date of registration shall be the date of grant of registration if the application is submitted after 30 days from the date on which the person became liable to registration .

One can download the Registration Certificate from the GST Website. It is to be noted that the registration once granted is permanent but it can be surrendered, cancelled, suspended or revoked later on and also an amendment or a change can be made to the GST Registration by filing an application for the same in the future also.

We thank you for this read ! For any more information related to it’s compliance, please feel free to contact us at SGR Consultancy or you can simply follow us on Facebook Page.

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