GST Online Registration process, Benefits, and GST FAQ
2024-03-01
On July 1, 2017, India embarked on a major fiscal reform by introducing the Goods and Services Tax (GST), a unified and comprehensive indirect tax system that replaced several previously existing taxes levied by both the state and the central government. This move aimed to simplify the tax structure, making it more transparent and conducive to the growth of businesses and the economy at large. GST is now the only national indirect tax regulation in India, streamlining the process of tax collection and compliance for businesses across the country.
Registering for GST is not just a legal requirement for certain businesses; it also offers numerous benefits. It enhances a company's credibility, allows for seamless input tax credit, and facilitates the easy flow of goods and services across state boundaries without complex tax calculations. In this write-up, we aim to provide a comprehensive guide on who is eligible for GST registration, how to go about the registration process, and why it is beneficial for businesses to register under GST in India. From understanding the eligibility criteria to navigating the registration process, we will cover all the essential steps and considerations for businesses looking to comply with GST regulations in India.
Benefits of Registering under GST
- For normal registered businesses: Avail input tax credit, conduct interstate business freely.
- For Composition dealers: Enjoy limited compliance, reduced tax liability.
- For businesses opting for voluntary registration: Benefit from input tax credit, interstate business operations, and a competitive edge in the market.
Simplified Steps for GST Online Registration
- Initiate Registration: Visit the GST portal, go to 'Services', click 'Registration', then 'New Registration'.
- Part-A Submission: Choose 'New Registration', select your role as 'Taxpayer', fill in your state, district, business name, PAN, contact details, and proceed with the OTP verification.
- Temporary Reference Number (TRN): Post verification, you'll receive a TRN. Note this down for Part-B completion.
- Complete Part-B: Using the TRN, log back in to fill Part-B with detailed information and documents like photographs, business address proof, bank account details (optional since December 2018), and more.
- Business Details: Specify your business type, opt for the composition scheme if applicable, and provide commencement and liability dates.
- Promoters/Partners Information: Input details for up to 10 promoters or partners, including personal and identity information.
- Authorized Signatory Details: Similar to promoter details, input information for the authorized signatory.
- Principal Place of Business: Describe the main location of your business, including ownership details and nature of business activities.
- Goods and Services Details: List up to 5 goods and services you deal with, along with their HSN/SAC codes.
- Bank Details: Provide details for up to 10 bank accounts. Note that this is optional at the time of registration but required post-GSTIN assignment.
- State-Specific Information: Enter details relevant to professional tax and excise licenses if applicable.
- Aadhaar Authentication (Optional): Opting for Aadhaar authentication can expedite the verification process.
- Final Submission: Verify all details, agree to the declaration, and submit your application using DSC, e-Sign, or EVC based on your business type.
- Acknowledgment: Upon successful submission, you'll receive an ARN (Application Reference Number) for tracking your application status.
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General Information about GST
What is GST?
The Goods and Services Tax (GST) is a unified tax system introduced in India on July 1, 2017, replacing several indirect taxes with a single tax. It applies to the supply of both goods and services across the nation.
Who is considered a 'person' under GST?
The term 'person' includes individuals, Hindu Undivided Families (HUFs), companies, firms, Limited Liability Partnerships (LLPs), Associations of Persons (AOPs), co-operative societies, societies, trusts, etc. Farmers are exempt from GST.
GST Registration
Is GST registration mandatory?
Yes, GST registration is mandatory for businesses with a turnover exceeding Rs. 20 lakhs (Rs. 10 lakhs for special category states) in a financial year. Certain categories of suppliers must register regardless of turnover, such as inter-state suppliers and e-commerce operators.
What is the threshold for GST registration?
The threshold for GST registration is a turnover of Rs. 20 lakhs in a financial year (Rs. 10 lakhs for special category states). Exceptions apply to specific categories of suppliers.
Is PAN required for GST registration?
Yes, having a PAN (Permanent Account Number) is mandatory for obtaining GST registration for Indian residents. For TDS registration, a TAN is required instead.
Can I apply for multiple GST registrations?
Yes, if you operate in multiple states or have different business verticals within a single state, you may need to secure separate GST registrations.
What is the timeline for registering under GST?
You should register within 30 days from becoming eligible for GST registration.
After GST Registration
What happens after successful GST registration?
After successful registration, you receive a GST certificate and GSTIN, making you eligible for benefits like input tax credit and the authority to issue GST-compliant invoices.
Special Schemes and Provisions
Who is eligible for the composition scheme under GST?
Small taxpayers with lesser turnover can opt for this scheme to benefit from reduced compliance and tax rates.
Definitions and Clarifications
What does 'aggregate turnover' mean?
Aggregate turnover includes the total value of all taxable, exempt supplies, exports, and inter-state supplies by a person with the same PAN, excluding taxes under CGST, SGST, UTGST, and IGST Acts.
Does GST apply to services?
Yes, GST applies to services, defined as anything other than goods, and may be taxed at different rates.
What activities are considered agriculture under GST?
Agriculture includes floriculture, horticulture, sericulture, raising of crops, grass, or garden produce but excludes dairy farming, poultry farming, stock breeding, or the gathering of fruit, or rearing of seedlings or plants.
Specific Scenarios
What if my GST application is rejected?
If your application is rejected, you can respond to the objection or wait for a final rejection before reapplying.
If my business changes from a proprietorship to a partnership, what should I do?
A new GST registration is required since a partnership firm will have a new PAN.
Are there any exceptions to the need for registration based on the nature of supplies?
Businesses dealing exclusively in goods or services that are exempt from GST are not required to register, regardless of their turnover.
Is there any area-based exemption under GST?
No, there are no area-based exemptions in GST.
Miscellaneous
What is the reverse charge mechanism?
Under the reverse charge mechanism, the recipient of goods or services is liable to pay GST instead of the supplier. This applies in specified cases.
Are services and goods taxed differently under GST?
Yes, services and goods may carry different GST rates.
Disclaimer:
The information provided in this article is for informational purposes only and is not tailored to individual circumstances. It is not a substitute for personalized financial advice. Readers are advised to consult their financial advisors before making any decisions. The contents may change, and the article is not intended for use where prohibited by law. Readers assume responsibility for any consequences of financial decisions based on the information herein. The features, benefits, and offers are subject to change without notice. Readers acknowledge that the institution or its affiliates mentioned in the article are not responsible for consequences arising from financial decisions based on its contents. EnKash Capital is a platform that connects businesses with different RBI-licensed NBFCs who are willing to offer lending options to the businesses. The loans offered on the platform are subject to the terms and conditions and loan approval process of the NBFC partners.
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