Goods and Services Tax (GST) is an inclusive tax that applies on the supply of goods, services in India. It was launched on July 1, 2017, to replace multiple indirect taxes like VAT, service tax, excise duty among others which created one single tax system country. In this article, we will discuss what GST is, requirements for registration of GSTIN, types of GSTR-3B filing forms, documents required while applying for GST number online and benefits after registering for GST.
Understanding Goods and Services Tax (GST)
It’s a kind of indirect tax which is imposed at all levels in the chain starting from manufacturing up to sale involving end customers. The tax levied is based on value addition done at every stage and input credit can be claimed by businesses against the taxes paid during purchase eliminating cascading effect.
Why should one register for Goods and Service Tax?
Registration under GST regime is mandatory if you have an annual turnover more than Rs. 40 lakhs. In case where it’s a hill state or north-eastern states then it would be Rs. 10 lakh. Moreover, some sort of businesses must get registered irrespective of their income like interstate supply goods operators in e-commerce sector individuals subject reverse charge mechanism.
Operating without registration under Good Services Tax(GST) is a criminal offence attracting severe penalty provisions hence it’s important for eligible persons/companies to get registered with good services tax Act after following compliance procedures provided thereof.
Types of Registrations
Normal taxpayer – majority operations fall under this category; there are no deposits nor expiration date associated with its registration.
Casual taxable person- Appropriate when someone engages into temporal business such as seasonal shops or stalls that will require advance deposit equivalent to envisaged liability under the GST Act over the time it will be active. Registration here lasts for three months and can be renewed.
Composition taxpayer- It is meant for companies which choose to follow the GST Composition Scheme where they are taxed at a fixed percentage of their turnover instead of standard GST rates. No input tax credit is available in this scheme.
Non-resident taxable person – these are non-residents who supply goods or services in India. An advance deposit equivalent to the estimated liability under the Goods and Services Tax Act awaits them and it is valid for 3 months renewable as per need.
Procedure for GST Registration–
Step by Step Online Registration
Visit the GST Portal: Go to GST Portal, click on ‘services’ tab, select “Register Now.”
New Registration- Choose New registration and fill in –
I am a …(under)
Choose your State and District.
Enter your business name, PAN, email ID, mobile number etc.
Enter image captcha then click Proceed button
Key in OTP sent to your email id & mobile phone after that press proceed button
Write down the Temporary Reference Number (TRN) provided by you.
Part B-
Go back to GST portal again and select “Services” tab now click register,
Select Temporary Reference Number (TRN), enter TRN & captcha then click Proceed
Key in OTP sent to your email id & mobile phone after that press proceed button
The documents to be uploaded after filling in 10 sections are-
Photograph
Proof of business address
Bank account details (account number, bank name, branch and IFSC code)
Authorization letter
Constitution of the taxpayer
Verification- Complete the verification process by using one of the following methods:
Electronic Verification Code (EVC)
Digital Signature Certificate (DSC) for companies
e-Sign method (OTP sent to Aadhaar-linked mobile number)
After you have completed it successfully, a successful message will pop up and Application Reference (ARN) will be email to your registered email and phone number.
Documents Required for GST Registration
To register for GST, you need the following documents:
PAN card
Aadhaar card
Bank account information
Proof of address
Digital signature
Photograph (JPEG format, max size 100 KB)
Articles of Association/Memorandum of Association
Certificate of incorporation (for companies)
Proof of appointment of authorized signatory
LLP registration certificate/Board resolution (for LLPs)
Eligibility for GST Registration
Individuals and businesses that must register for GST are:
Those who were previously registered under any other law.
Non-Resident and Casual Taxable Persons.
Businesses with a turnover exceeding Rs. 40 lakhs (Rs. 10 lakhs for some states).
E-commerce operators or those supplying goods through e-commerce platforms.
Input Service Distributors/Agents of Suppliers
Taxpayers pay tax under reverse charge mechanism.
Advantages of GST Registration
- Legal Recognition-Registering for GST gives your business legal recognition as a supplier of goods or services.
- Input Tax Credit- Businesses can claim input tax credit on their purchases which thus reduces the tax burden.
- Interstate Business- Registered businesses can supply goods and services across states without restrictions.
- E-commerce Eligibility- Registration enables businesses to sell on e-commerce platforms.
- Competitive Advantage- GST registration can provide a competitive edge by showcasing compliance with tax regulations.
Penalty for non-registration
Failure to register for GST or delay in registration can result in penalties. The fine is 10% of the tax amount due, with a minimum of Rs. 10,000. In cases of deliberate tax evasion, the penalty is 100% of the due tax amount.
Checking GST Registration Status
To check the status of your GST registration
Visit the GST portal.
Click on ‘Services’ > ‘Registration’ > ‘Track Application Status’.
Enter your ARN and captcha code, then click ‘SEARCH’.
Downloading the GST Registration Certificate
To download your GST registration certificate:
Visit GST Portal.
Click on ‘Login’ and enter your username and password.
Go to ‘Services’ > ‘User Services’ > ‘View/Download Certificates’.
Click on ‘Download’ to get your certificate.
Conclusion
GST is a crucial aspect of running a business in India, ensuring compliance with tax regulations, and providing several benefits. By understanding the GST registration process, types, and required documents, businesses can navigate the system smoothly and avoid penalties. This guide aims to simplify the GST registration process and help businesses operate legally and efficiently
