Practical Guide on GST Registration in India

Share

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.

The 1st and the foremost thing which every business should do regarding GST is to apply for GST Registration Number. GST Registration number also referred to as GST Identification No. (GSTIN) is a unique number which is allocated to all business who have applied for GST Registration. The GSTIN is a 15 digit no. and is PAN based. The 15 digit GST Registration comprises of the following aspects

GST-Registration

The registration in GST is PAN based and is state specific. A supplier has to register in each state from which he is supplying goods/ services. In other words, if a supplier has branches in different states – he would be required to take separate registration for each of these states.

But within a state, a supplier can declare one place as the principal place of business and the other branches as additional place of business.

Who should register for GST?

GST Registration is mandatory if your aggregate annual turnover exceeds Rs. 20 Lakhs in a financial year. (Rs. 10 Lakhs in case you have a place of business in Arunachal Pradesh, Assam, Himachal Pradesh, Jammu & Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura or Uttarakhand.

The above mentioned limits are only for transactions done in the same state. The above limit is not applicable in case of inter-state transactions. In case of inter-state transactions – it is mandatory to register from Rs. 1.

GST Registration is also mandatory in the following cases:-

  • You supply goods through an e-commerce portal, or
  • You supply goods/services in the course of inter-state trade (Export is also considered as inter-state trade and therefore registration is mandatory in case of Export as well.)
  • You are a/an
    • Service Provider
    • Agent for Registered Person
    • Casual Taxable Person
    • Input Service Distributer
    • TDS/ TCS Deductor
    • E-Commerce operator
    • OIDAR – Online Information & Database Access Retrieval Service provider supplying services from outside India to a non registered person in India.
  • You are registered under any of the earlier Indirect Tax Laws (i.e. Service Tax, VAT, Excise etc) irrespective of turnover.

Regardless of your turnover, GST Registration is mandatory if any of the above mentioned criteria is fulfilled. However, a person may also apply for GST Registration voluntarily out of his free-wish.

Exemption from GST Registration

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

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

What are the benefits of GST Registration?

The following benefits will arise to all persons who are registered under GST:-

  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.

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.

If the application is submitted after 30 days from the date on which the person became liable to registration – the effective date of registration shall be the date of grant of registration.

The Registration Certificate can be downloaded online from the GST Website. The Registration once granted is permanent unless surrendered, cancelled, suspended or revoked. However, changes can be made to the GST Registration at any time in future by filing an application for amendment of GST Registration.

How to apply for GST Registration?

  1. Application for GST Registration can be made online through the link – gst.gov.in
  2. Scanned copy of all documents is required to be submitted online itself. The physical copy is required only if you receive a mail asking for the same.
  3. You are also required to furnish the names and HSN/SAC Code of the goods/services which you sell. You can mention details of maximum of 5 services/goods. In case you are selling more than 5 services/goods – you can mention the details of only 5 services/goods in the GST Registration Form. However, there is no maximum limit on the maximum number of goods/services which you can sell. You can mention the details of all other goods/services in the GST Returns.
  4. You can either sign the Registration Form through Digital Signature or e-verify the Registration Form through Aadhar Card.

HSN/ SAC Code to be mentioned in GST Registration

HSN Code stands for Harmonised System of Nomenclature and is a code which is assigned to each type of goods. The purpose of using this code is to ensure that the GST practices are in line with the international standards.

Just like HSN Code is for goods, SAC Code which stands for Services Accounting Code is assigned to each type of service.

You are required to mention the HSN/SAC Code at the time of registration as well as on the invoice and in GST Returns. You can find the HSN Code for your goods/services through this link – HSN/SAC Code finder.

Meaning of Aggregate Turnover for the purpose of GST Registration (GSTIN)

As per Section 2(6) of the CGST/SGST Act “aggregate turnover” includes the aggregate value of:-

  1. All taxable supplies
  2. All exempt supplies
  3. Exports of goods and/or service
  4. All inter-state supplies

The above shall be computed taking into account on all India basis and excludes the taxes charged i.e. CGST, SGST, UTGST, IGST. Aggregate turnover shall also include all supplies made by a taxable person, whether on his own account or made on behalf of all his principals.

Amendment in GST Registration

Except for the changes in some core information in the registration application, a taxable person shall be able to make amendments without requiring any special approval from the tax authority.

In case the change is for the legal name of the business, or the state of place of business, the taxable person will apply have to apply for amendment within 15 days of the event. The assessing officer will then approve the amendment within the next 15 days.

For other changes like email id’s, mobile no.’s etc, no approval of the assessing officer is required and the amendment can be done by the taxable person himself from the GST Website i.e. gst.gov.in

How to apply for Cancellation of GST Registration?

The GST Law provides for 2 scenario’s wherein cancellation of GST Registration can take place i.e.

  1. Voluntary Cancellation by the taxable person
  2. Suo Motu Cancellation i.e. when the assessing officer considers the registration liable for cancellation in view of certain specified defaults.

In case of volutantary cancellation, the taxable person desirous of cancellation of registration will have to apply on the GST website (i.e. www.gst.gov.in). He will also declare in the application the stock held on the date from which he seeks cancellation. He will also work out and declare the quantum of dues of payments and credit reversal, and the particulars of payments made towards the discharge of liabilities.

In case of voluntary registration (taken without being liable for), no cancellation is allowed until the expiry of 1 year from the effective date of registration. If satisfied, assessing officer has to cancel the registration within 30 days from the date of application.

Other Relevant Provisions regarding GST Registration (GSTIN)

  1. If a person is operating from different states, he would be required to apply for GST Registration separately for each state in operation. There is no option to apply for a centralised GST Registration.
  2. A person having multiple businesses can apply for either single GST Registration or separately for each business.
  3. Filing GST Returns is mandatory in case a person has a GST Registration Number.
  4. A person without GST Registration can neither collect GST from his customers nor can be claim the benefit of Input Tax Credit.

What are the Documents required for GST Registration?

Documents required for GST Registration of Sole Proprietor/ Individual

  1. PAN Card and ID Proof of the Individual
  2. Copy of Cancelled Cheque or Bank Statement
  3. Declaration to comply with the provisions
  4. Copy of Electricity Bill
  5. No Objection Certificate of the owner
  6. Rent Agreement (in case premises are rented)

Documents required for GST Registration of a Partnership Firm

  1. PAN Card of the Partnership Firm
  2. Partnership Deed
  3. Copy of Bank Statement
  4. Declaration to comply with the provisions
  5. PAN and ID Proof of the designated partners
  6. Copy of Electricity Bill/ Landline Bill/ Water Bill
  7. No objection certificate of the owner
  8. Rent Agreement (in case the premises are rented)

Documents required for GST Registration of a Company

  1. PAN Card of the Company
  2. Registration Certificate of the Company
  3. Memorandum of Association (MOA)/ Articles of Association (AOA)
  4. Copy of Bank Statement
  5. Declaration to comply with the provisions
  6. Copy of Board Resolution
  7. PAN and ID Proof of the Directors
  8. Copy of Electricity Bill/ Landline Bill/ Water Bill
  9. No Objection Certificate of the owner
  10. Rent Agreement (in case the premise is rented) 

Documents required for Limited Liability Partnerships

  1. PAN Card of the LLP
  2. Registration Certificate of the LLP
  3. LLP Agreement of the Partnership
  4. Copy of Bank Statement of the LLP
  5. Declaration to comply with the provisions
  6. Copy of Board Resolution
  7. PAN and ID Proof of the Designated Partners
  8. Copy of Electricity Bill/ Landline Bill/ Water Bill
  9. No Objection Certificate of the owner
  10. Rent Agreement (in case the premise is rented)

Karan is CA by Qualification with the rare distinction of being awarded All India Rank 22. He is also the founder of this website and loves to help people with their Tax Queries.