Introduction of GST Registration in India
GST or Goods and Services Tax was introduced by the Prime Minister of India in an attempt to regulate prices throughout the country and remove all state or central Govt. imposed indirect taxes on goods and services by initiating GST registration in India.
As per the new GST registration regulation, businesses whose turnover exceeds Rs 20 lakhs (10Lakhs for North East and hill states) is required to get their GST registration as a normal taxable person. This process is called the GST registration.
Apart from the other turnover bracket, there are certain cases where new GST registration is mandatory for individuals or entities engaging themselves in the supply of goods or services across the state to get GST registration online. One can apply for online GST Registration either as a normal taxpayer or under GST composition scheme.
What is Goods and Service Tax is all about?
As we glare to the name, the name itself depicts that the GST will be applicable on both the goods and services following a dual system of GST keeping the work of both the Central and the State Government independently. The GST Council is headed by the Union Finance Minister and will also include various State Finance Ministers.
GST Tax Structure
The following is the chart shows the applicable tax structure of the Goods and Service Tax.
*0% is GST rate is applied to the most essential goods such as rice, wheat etc. The complete bifurcation of the GST tax rate applied to the different categories of goods and services can be easily accessed by just contacting us. You give us a call and our team will reach you very soon with the complete detail.
Indirect taxes that are replaced under new GST Registration
After the introduction of new GST registration, all indirect taxes department have been close merged As GST Department. Hence, the following are the details of the indirect taxes of central and state government that are replaced after the introduction of the GST Registration in India.
1. Taxes that are levied and collected by the Central Government
- Service tax
- Central Excise duty
- Additional Duties of Custom ( also known as CVD)
- Special Additional Duty of Custom (SAD) And,
2. Taxes that are levied and collected by the State Government
- State VAT
- Central Sales Tax
- Entertainment and Amusement Tax
- Taxes on lotteries, betting, and gambling
Like many other countries such as Canada and Brazil, India will also follow the dual form of GST. At the Intrastate level where goods and services are sold within the state, CGST (Central Goods and Service Tax) and SGST (State Goods and Service Tax) will be levied on it.
On the other hand, while selling any goods and service in another state i.e. interstate then IGST will be levied. IGST stands for Interstate Goods and Service Tax. Any goods that are imported come under the IGST and termed as interstate supply. Not only this, but the imported goods will also attract the basic customs duty.
However, Exports and supplies to Special Economic Zone will be considered as zero-rated.
What is a GST Registration Procedure in India?
The GST Registration process is as easy as a piece of cake. Swarit Advisors helps flairs the light on the road to get your GST Registration online and obtain the GSTIN. Into the bargain, Swarit Advisors will also guide you about the compliances and regulation that are implanted under GST Registration.
Hence if you are not good with the above form then following is the detailed explanation on GST Registration Process-
- Log on to www.gst.gov.in
- Click on the “Service” which is available at the top of the page and select on ”Registration” from the three options “ Registration” “Payments” and “User Service”
- Select “New Registration”
- Fill in the details like the basic details, about the nature of applicants like taxpayer or a GST practitioner
- Fill the details like legal name of the business, location of the business, PAN of your business account, email address and another contact number. The Part A of the Form will include all this.
- The details will be verified by the portal through an email- confirmation and one- time password.
- Submit the required documents which will depend upon the type of your business.
- Submit Part B of the form
- You will get an APPLICATION Reference Number via email or Text Message to confirm the successful completion of forms.
After the scrutiny of the forms and the documents, the GST officer will either approve your application or either reject on the grounds of other necessary documents approval for GST Registration.
Documents required for New GST registration in India
Missing one document can pull you one step back from getting the New GST registration. So, the following are the GST registration documents that are required at the time of online GST registration in India.
- PAN card.
- Identity proof and address proof like Aadhar Card, Pan Card, Driving License
- Proof of registration of business, or Partnership Deed in case of partnership and registration certificates.
- Address proof for the location of business like Aadhar Card, PAN Card, Electricity bill, phone bill)
- Business Bank account details
- Rent agreement or lease agreement in case of property purchase on rent or lease.
Now, after wiping the dust from the GST Registration procedure lets have some discussion on the eligibility criteria for Online GST Registration.
Eligibility Criteria for Online GST Registration in India
Sections 22 of the ACT specify the threshold limit for online GST registration and also determine the following suppliers to go for online GST registration process.
If the aggregate turnover of any supplier exceeds 20 lakh rupees then the company needs to go for the New GST Registration online
However, if the supplier comes under the Special Category States, this threshold limit of aggregate turnover is 10 lakh rupees need new GST Registration. Here special category states include states of north-east India, Himachal, Uttarakhand and Jammu & Kashmir.
Mandatory or Compulsory GST Registration
Along with these threshold limits, Section 24 of the Act also specifies a list of suppliers for whom online GST registration is mandatory. The list includes the following suppliers:
- Input Service Distributor
- Supplier under the reverse charge.
- A person supplying through E-commerce by collecting tax at source u/s 52.
- A person claiming or remitting Input Tax Credit.
- Any person doing inter-state supply.
- The casual taxable person affecting taxable supply.
- The non-resident taxable person affecting taxable supply.
- E-commerce Operator
- Any person supplying on behalf of other like as an agent or not.
- Any person supplying online information and database or retrieval service from a place outside India to a person in India who is unregistered and needs an online GST Registration.
Voluntarily Online GST Registration in Delhi
A person on his own motion may apply for voluntarily GST Registration online even if he has no turnover of supply of goods or services. He is still eligible to taste all the benefits that are available to any other taxpayer under the Act. Voluntary New GST registration process has its share of blessing and a curse. The benefits of voluntary online GST registration process include:
- Easily collection of tax from his customers
- The process to claim Input Tax Credit becomes facile
- Can issue GST invoice
- Customer are more likely to buy from the registered taxable suppliers
Who all are required to have GST Registration Certificate in India?
- Existing taxpayers – All existing taxpayers registered under VAT/CST, Excise, Service tax i.e. mandatorily required to apply for online GST Registration as only the registered person under GST will be allowed to carry forward of Input tax credit.
- New Taxpayers – All taxpayer who is liable under the earlier tax regime are required to get their GST registration.
- For Causal dealer – A casual dealer who wants to start a business under GST regime has to apply for online GST Registration within five days of commencement of business. A casual dealer has to pay GST in advance calculated on the estimated turnover of 90 days. The validity of Online GST Registration for the causal dealer is decided for only 90 days.
- For Non-resident taxable person – a non-resident taxable person who commences a business without setting up fixed establishment or office then he has to apply for Online GST Registration in India within five days before commencement of business. The validity of new GST registration for non-resident is for maximum 90 days. Furthermore, another extension may be applied for another 90 days and the tax has to be paid in advance.
What are the Advantages of GST Registration in India?
After reading the article so far, you must be bogged by some of the thoughts like why there is so much bragging of GST registration. So, there are some of the advantages that will clear your mind on the benefits of registering under GST
1. For Registered Businesses:
- Avail Input Tax Credit
- Interstate sales without restriction
2. For Composition dealer:
- Limited compliances imposed
- Less tax liability
- High working capital
3. A business that voluntarily opted GST Registration in India
- Avail Input Tax Credit
- Inter-state supply without restriction
- Easy Registration on e-commerce websites
- Competitive Advantages compared to other businesses
4. Apart from the other benefits the following are the benefits of GST Registration
- Eliminates the cascading effect of the tax
- Higher threshold limit for registration
- Simple and easy online procedure
- Facility of Composition Scheme
- Simple and easy online procedure
- Less number of compliances
GST Registering Fees in India
There is no official government cost or fees that need to pay for the Online GST registration on the official government websites.
However, filing for GST registration in India is still a sweaty task and involves various steps and documentation. Thus, it is recommended to get professional help for the same. Our team at Swarit Advisors provides you the end to end services related to GST Registration Procedure.
Penalty for Non-Compliances under GST Registration in India
- There are strict laws under the GST Act for the non- compliance of the act
- If there is any delay in the payment or non- payment of the taxes accrued, then the offender will be liable to lose the pocket and pay a heavy penalty on it. Such penalty will be 10% of the unpaid tax or Rs 10,000 whichever is higher
- However, if the offender has deliberately evaded the payment of taxes under the law the penalty amount will be 100% of the unpaid tax
What are GST Returns and how is to be filed under GST Registration in India?
The Registered taxpayer is burden with various compliances. One of the most important compliances that are under the GST is to file GST returns on a timely basis. GST returns are filed with the documents relating to the purchases, sales, tax collected, ITC etc. After filing all the relevant information tax liability is computed and paid off. Kindly read our full article on GST Returns and GST compliances and Due dates to file GST Registration.
Hierarchy of Officers in GST Department
There are 9 classes of officers as per the CGST Act, with 17 officers and a general class, whereas the SGST Act contains 6 classes of officers, with a general class.
- As per Model GST Law, Board i.e. the Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963 has the power to appoint officers of CGST (Note: State laws may have similar provision)
- The Commissioner of SGST under SGST law will have jurisdiction over the whole of the appropriate State. All other officers shall have jurisdiction over the whole of the State or over such areas as the Commissioner may, by notification, specify.
- The powers of the First Appellate Authority have been restricted to those specified under Section 79 of the CGST law. (Note: State laws may have similar provision)
The following are the hierarchy of the officers under the Central Goods and Service Tax act, namely;
- Principal Directors General of CGST or Principal Chief Commissioners of CGST or
- Directors General of CGST Chief Commissioners of CGST or,
- Principal Additional Directors General of CGST or Principal Commissioners of CGST
- Additional Directors General of CGST or Commissioners of CGST
- First Appellate Authority,
- Additional Directors of CGST or Additional Commissioners of CGST
- Joint Directors of CGST or Joint Commissioners of CGST
- Deputy Directors of CGST or Deputy Commissioners of CGST
- Assistant Directors of CGST or Assistant Commissioners of CGST
- Or such other class of officers as may be appointed for the purposes of this Act.
Furthermore, the hierarchy of officers under the State Goods and Service Tax Act
- Commissioner of SGST,
- Special Commissioners of SGST,
- Additional Commissioners of SGST,
- Joint Commissioners of SGST,
- Deputy Commissioners of SGST,
- Assistant Commissioners of SGST, and
- Or such other class of officers and persons as may be appointed for the purposes of this Act. [List is indicative]
Now, to check the hierarchy of the appeals under GST department you can read our article on “Hierarchy of Appeals under GST Department”
Frequently Asked Questions on GST Registration
All businesses that are registered under GST are assigned with a unique Goods and Service Tax Identification number or GSTIN.
If a business provider operates from more than in one state then a separate GST registration is required for each state. For example- a shoe manufacturer sells in Karnataka and Tamil Nadu, now he has to apply for separate GST registration in Karnataka and Tamil Nadu respectively. A business with multiple business verticals in a state has the option to obtain a separate registration for each business vertical.
Small businesses that have an annual turnover of less than Rs 1 crore (Rs 75lakhs for NE states) can opt for Composition scheme. In GST Registration the composition dealer is required to pay nominal taxes based on the nature of business-
- Composition dealer is required to file only one quarterly return instead of three returns filed by normal taxpayers.
- They cannot issue taxable invoices which means they collect tax from customers and are required to pay the tax from their own pocket.
- Business who opted for the composition scheme cannot ask for Input Tax Credit.
The following are the taxpayer for whom the composition scheme is not applicable to
- Service Provider
- Inter-state sellers
- E-commerce Sellers
- Supplier of non – taxable goods
- Manufacturer of Notified Goods
This scheme is a very easy option for all the SMEs who want to have fewer compliances and lower rates of taxes under GST. A GST taxpayer whose business turnover is below Rs 1 crore can opt for the Composition scheme however the limit of turnover for North East state has been decided on Rs 75 lakhs.
A reverse charge is a mechanism in which the liability of paying the GST tax is levied on the buyer, not on the supplier.
When the goods and services are offered or supplied periodically and the payments are also made on the timely basis, it is called a continuous supply under GST Registration.
A compliance rating is nothing but a rating which is given to the all the registered taxpayer on their performance. The rating is given for the implementing and complying with all the provisions of the GST timely and properly.
The following are exempted under GST Registration
- Supply agriculture produce form cultivation
- Exempt supplies or NIL rated supply or Non- Taxable Supplies of goods or services
- Supplies come under the Reverse charge
Yes, a person can anytime get the voluntary registration under GST in terms of subsection (3) of section 25. And after the registration, the provision will apply to him as they applied on a registered person.
The Registration can be canceled in two situations
- When the taxable person who has opted for voluntary registration or voluntarily cancel his GST Registration.
- When the proper officer on any default from the end of the taxpayer moves to cancel the GST Registration on his own motion.
The GST Taxpayer will apply on the GST portal within 30 Days from any intimation form proper office. In the meantime, the taxpayer will declare in the application, the stock held by it on that date, amount of dues and credit reversals and particulars of payments made towards the discharge of such liabilities. If satisfied, the proper office will cancel the registration in 30 days and intimate to the taxpayer.
No, there is no such concept like Central GST Registration in India. An entity having more than one branch will have to take separate state wise GST registration for each branch.
A Non-Resident Taxable Person is one who is a foreigner and occasionally wants to affect the taxable supplies from any state in India and for that, he needs GST Registration.
In this article, we have tried to cover all the major point related to GST Registration in India, or Online GST Registration etc. Swarit Advisors Advisory has been working in the field of GST Registration form the time it started and have scored thousands of happy customers by providing them on time GST registration. To get your GST registration, just call us or reach us.