GST registration process is all about obtaining a Goods and Services Tax Number (GSTN). It is imperative for individuals and firms that are engaged in the supply of goods or services within India. The mandatory registration threshold is an aggregate turnover exceeding an amount of INR 40 lakhs, and for states falling under the special category, it is INR 20 lakhs.
The Ministry of Finance has streamlined the registration process to simplify tax filing. Once registered a business is issued a unique GST identification number, allowing it to collect and remit Goods and Services Tax (GST) on sales.
On this page
Categories and eligibility criteria for GST Registration Process
Eligibility for GST registration is determined by various factors, including aggregate turnover, inter-state business, e-commerce activities, casual taxable persons, and voluntary registration.
- Inter-state Business:
- Entities engaged in supplying goods across states are required to register, irrespective of their turnover. Inter-state service providers need registration if their turnover exceeds INR 20 lakhs (INR 10 lakhs for special category states).
- Aggregate Turnover:
- Service providers with an annual turnover surpassing INR 20 lakhs (INR 10 lakhs for special category states) must undergo GST registration.
- Entities exclusively involved in supplying goods must register if their turnover exceeds INR 40 lakhs.
- E-commerce Platform:
- Individuals selling goods or services through e-commerce platforms must undergo GST registration, regardless of turnover.
- Casual Taxable Persons:
- Individuals intermittently supplying goods or services through temporary stalls or shops must apply for GST, irrespective of annual turnover.
- Voluntary Registration:
- Entities have the option of voluntary GST registration, and recent revisions allow applicants to surrender voluntary registration at any time.
What are the types of GST Registration?
- Normal Taxpayer:
- Normal taxpayers are required to maintain detailed records of their transactions, file regular GST returns, and comply with various provisions of the GST law.
- Applicable to businesses operating in India, with no deposit requirement and an unlimited validity period.
- These are businesses whose annual turnover exceeds the threshold limit set by the tax authorities.
- Composition Taxpayer:
- Composition taxpayers are subject to lower GST rates but cannot avail Input Tax Credit (ITC). They also have simplified compliance requirements.
- Enrolled under the Composition Scheme, these taxpayers pay a flat GST rate but are unable to claim ITC.
- Businesses with a turnover below a certain threshold may opt for the composition scheme.
- Casual Taxable Person:
- These are individuals or businesses that occasionally make taxable supplies but do not have a fixed place of business in the place where they are conducting business.
- Casual taxpayers are required to register for GST for the period they intend to operate in a particular location.
- Individuals establishing seasonal stalls register under this category, with a deposit equal to the GST liability for a 3-month active registration period.
- Non-Resident Taxable Person:
- The term “non-resident taxable person” defines a category of taxpayers under the GST system.
- This categorization holds importance in the context of GST registration, encompassing individuals or businesses involved in taxable activities without a fixed place of business in the relevant location.
- Applies to individuals outside India supplying taxable goods or services to Indian residents. A deposit equal to the GST liability is required for a 3-month registration period.
Various categories of taxpayers exist under the GST regime, each with its distinct rules and compliance obligations. Most of the businesses fall into the “Normal Taxpayers” category, which entails adhering to standard GST procedures. This involves regular filing of returns, meticulous record-keeping, and compliance with the ITC system.
It’s crucial for businesses to comprehend the specific rules and thresholds applicable in their respective countries, as GST implementation can differ across jurisdictions. This understanding is essential to ensure accurate compliance with tax regulations.
What are the documents required for GST Registration?
Requirements for GST registration can vary across countries due to the varied enforcement of the taxation system. However, a list of commonly required documents for GST Registration in various jurisdictions majorly includes proof of identity, such as the PAN card for businesses or individuals.
Additionally, proof of address can be established through documents like Aadhar card, Passport, Voter ID, Driving license, Ration card, or utility bills. The submission of passport-sized photographs is typically necessary for the business owner, partners, or directors.
Distinct registration documents are required for businesses with specific structures. Sole proprietorships need to furnish proof of registration or a business license, while partnerships are obligated to provide their partnership deed. Private limited companies are required to submit their Certificate of Incorporation and Memorandum of Association, and public limited companies should include the same documentation.
Limited Liability Partnerships (LLPs) are expected to present their Certificate of Incorporation and LLP agreement. Essential for the registration process are bank account details, conveyed through a canceled cheque or a copy of the bank statement. In cases involving an authorized signatory, an authorization letter or board resolution is necessary.
Digital signature certificates are mandatory for companies and LLPs. Additionally, businesses are typically expected to disclose turnover details for the previous financial year. Supplementary documents may be necessary based on the nature of the business. For example, service-based businesses might be required to submit documents related to the specific nature of services provided.
Due to potential variations in requirements, it is advisable to consult with local tax authorities or seek advice from tax professionals to ensure compliance. Many countries have streamlined the GST registration process through online portals, enhancing accessibility and efficiency.
Step by step process of GST Registration
Individuals applying for GST registration can utilize the GST Portal to complete the registration process. Upon submission of the application, the portal promptly generates a GST Application Reference Number (ARN). Using this ARN, applicants can track the status of their application and submit inquiries if necessary. Typically, taxpayers receive their GST registration certificate and GSTIN within 7 days of ARN generation.
Step 1: Visit GST portal
Visit the GST portal. Click on the ‘Register Now’ link under the ‘Services’ tab then click ‘New Registration’ and fill out the asked details.
Step 2: Fill the Part A of Form GST Reg-01
After selecting ‘New Registration’ you will be given to fill the Part A of Form GST Reg-01 where you need to select ‘Taxpayers’ then respective ‘State and District’. Enter the Name of the Business, PAN of Business, Email ID and Mobile Number in their respective boxes. Make sure you give active email id and mobile number as you receive OPT.
Enter the image that is shown on the screen to proceed further. On the next page you will get to verify obtained OTP that was sent to your mail and mobile number and click proceed. Filling Part A of Form GST Reg-01 will come to an end by showing you the Temporary Reference Number (TRN). Take note of TRN which helps you in filling the Part B of Form GST Reg-01.
Step 3: Fill the Part B of Form GST Reg-02
After filling out Part A you need to fill in Part B. Visit the GST portal again and click on ‘Register’ under the ‘Service’ tab. Select TRN to enter the TRN obtained in Part A and enter the captcha details, and click on the ‘Proceed’ button. Hereafter you will receive an OPT on your registered Mobile number and Email ID, enter it properly to get your application status on the next page.
In the next step, fill in all the details and submit the required documents they have asked for.
- Photograph
- Business address proof
- For Banking purposes, details such as Account number, Bank name, branch, and IFSC code.
- Authorization form
- The constitution of taxpayers.
Submit all the above documents and move to the next step.
Step 4: Verification
- Go to the ‘Verification’ page, check the declaration, and proceed to submit the application using one of the methods below:
- Via Electronic Verification Code (EVC): The code will be sent to the mobile number registered in the system.
- For companies registering, the application must be submitted using the Digital Signature Certificate (DSC).
- By employing the e-Sign method: An OTP will be sent to the mobile number linked to the Aadhaar card.
- After successfully finishing the task, a confirmation message will be displayed on the screen. The ARN will be dispatched to both the registered mobile number and email ID.
You will receive the GST Number after the verification, and it may take approximately 7 to 10 working days. Once your business firm gets registered you easily can be able to download the Registration Certificate which completes the GST Registration procedure.
How much does it cost for GST registration in India?
The registration cost for GST differs across countries, given that GST is a consumption tax adopted by various nations globally. Each country establishes its own GST rules and regulations, encompassing the registration procedure and related charges. While certain countries offer GST registration for free, others may impose a nominal fee or a percentage of the projected turnover as part of the registration process.
Although the GST registration process generally doesn’t include fees, businesses may have to cover costs linked to obtaining supporting documents, acquiring digital signatures (if needed), or seeking professional assistance.
Conclusion
In conclusion, the GST registration process is a crucial necessity for businesses in India, ensuring adherence to the Goods and Services Tax framework. This process involves evaluating eligibility, submitting documents, and completing an online application via the official GST portal.
Upon successful verification, a unique GSTIN is assigned, and a registration certificate is issued. Subsequently, businesses are required to conform to GST regulations, consistently file returns, and maintain meticulous record-keeping practices.
GST registration serves as an integral element for both financial and legal compliance for businesses operating in India. Choose 24efiling for a hassle-free and timely GST registration process.
FAQs
1. Which entities are required to enroll for GST in India?
Any business or individual involved in the supply of goods and services with an aggregate annual turnover above the prescribed threshold limit must register for GST.
2. What is the prescribed threshold limit for GST Registration?
The threshold limit for GST registration varies for different states in India. As of my last knowledge update, it is INR 20 lakhs for most states and INR 10 lakhs for special category states.
3. How can one get GST Registration application status?
You can check the status of your GST registration application on the official GST portal using the ARN provided at the time of application.
4. Is there any penalty for not registering under GST?
Yes, there can be penalties for not registering under GST when required. Penalties may include fines and legal consequences. It’s essential to register if your turnover exceeds the prescribed limit to avoid such penalties.
5. Can a business voluntarily register for GST, even if its turnover is below the threshold?
Yes, businesses can voluntarily register for GST, even if their turnover is below the threshold limit. This can be beneficial for businesses looking to avail ITC and enhance their market credibility.
