GST Registration

GST Registration Procedure

GST registration is the procedure by which a taxpayer registers for GST. Upon successful registration, a business is given the Goods and Services Tax Identification Number (GSTIN), a special registration number.

If you operate from more than one state, please be aware that you must register separately for each state.

If the business is located in a state under a special category, GST registration is required if its annual revenue reaches Rs. 20 lakh. Lawgical Adda will examine the requirements for acquiring GST registration in this post. The essential paperwork and the online GST registration process are also covered in this article.

GST Registration: What Is It?

The process of assigning a unique identification number to a company that has to pay Goods and Services Tax (GST) is known as GST registration. Businesses that have an annual revenue of more than Rs. 40 lakh (or Rs. 20 lakh in certain states under specific categories) are required by GST to register as regular taxable businesses. Depending on the nature of the firm and its location, this barrier could change. Businesses that exceed the turnover threshold must register for GST; failure to do so will result in fines and legal action. GST registration ensures conformity and transparency in the tax system.

GST Registration Types

The several forms of GST registration are described below:

Normal Taxpayer

This GST registration category is for taxpayers who run their businesses in India. Enrolling as a regular taxpayer does not require a deposit, and the validity period is unbounded.

Taxpayer by Composition

To register as a composition taxpayer, a person must enroll under the GST Composition Scheme. The GST rate that taxpayers registered in the Composition Scheme can pay is flat. Nevertheless, the taxpayer would be unable to collect the input tax credit.

Casual Taxable Person

Any taxpayer who opens a temporary storefront or stall must register as a Casual Taxable Person. The taxpayer must make a deposit equivalent to the amount of their GST due to register as a casual taxable person. The liability and the active registration periods coincide. During the next three months, the registration is still valid.

Non-Resident Taxable Person

Those who are not residents of India fall under non-resident taxable persons. Only after registering can the taxpayers provide taxable goods or services to Indian citizens. The taxpayer must make a deposit equivalent to the amount of their GST due in order to be recognised as a non-resident taxable person. The liability and the active registration periods coincide. For three months, the registration is still active.

Crucial information regarding GST registration

1. A business must register for GST if its annual revenue exceeds 20 lakh Indian rupees.
2. If you supply commodities to multiple states, you must register for GST in each state where you supply goods.
3. For GST, there is no registration cost.
4. A punishment of 10,000 INR, or 10% of the outstanding amount, will be imposed for failing to file for GST.

What is the Turnover Limit for GST Registration?

GST registration is the process of getting a unique identification number for a person or organization that provides goods or services in India. Regardless of revenue, anyone or any company can register for GST. However, depending on the state category and supply, turnover becomes required when it exceeds certain criteria.

The total turnover of an individual or company within a fiscal year serves as the turnover threshold for GST registration. The total value of all taxable, exempt, export, and interstate supplies made by an individual with the same PAN—exclusive of GST taxes—is known as aggregate turnover. For service providers, the value of inward supply that is subject to reverse charge obligations is included in the aggregate turnover.

What are the advantages of GST registration for companies that voluntarily choose to register?

Companies that have registered for GST are eligible for several advantages, including:

1. Working capital reduction for composition dealers: Under the GST, composition dealers who operate as small enterprises with annual sales between Rs. 20 and Rs. 75 lakh are eligible to pay a lower tax rate. They might lower their working capital demand by claiming input tax credits by registering for GST.
2. Reduced tax liability: By registering for GST, companies can take advantage of input tax credits and collect GST from their clients. They pay less in taxes as a result, preventing double taxation. Additionally, it streamlines the compliance process by requiring firms to file a single consolidated return rather than several separate forms for various taxes.
3. The benefit of unrestricted interstate commerce: Businesses can conduct interstate commerce without limitations or obstacles, thanks to GST registration. They don't need to get any permissions or pay extra taxes to sell their products and services nationwide. Their consumer base and market reach grow as a result.
4. Competitive advantage: To obtain a competitive edge in the market, businesses not required to register for GST may choose to register for GST voluntarily. By registering for GST, they can increase their legitimacy and reputation with suppliers and consumers.

Penalties for failing to register for GST

Not registering for GST may result in harsh fines and repercussions. Among the sanctions under question are:

A penalty for failing to register, even if required, would be Rs. 10,000 or 10% of the tax owed, whichever is larger.

If GST is collected but not deposited to the government within three months, there would be a penalty of Rs. 10,000 or the tax amount, whichever is larger.

FAQs

1. What kind of revenue is GST eligible?

To be eligible for GST registration, you must have at least 40 lakh INR (for supplies of goods in a normal state), 20 lakh INR (for supplies of goods/services in a normal state), 20 lakh INR (for supplies of goods in a specified state), or 10 lakh INR (for supplies in a specific state).

2. Who is not eligible for GST registration?

The acquisition of GST registration is optional for those who supply products or services that are completely exempt from taxes or that are not subject to taxation.

3. Is GST required?

Yes, once your turnover reaches the designated threshold, you must register for GST.

4. How many days does the GST registration process take?

It typically takes two to six business days to register for GST.

5. Can I submit a request to have my GST registration cancelled?

There are just a few specific reasons why the registration, which is granted under GST, may be cancelled. The department may decide to cancel the registration independently, or the registered individual may request that their registration be cancelled. The legal heirs of a registered person may request cancellation in the event of their death.