Introduction
The new Goods and Services Tax that is simply called as GST was introduced across the country on July 1, 2017. GST is a single tax that replaces several indirect taxes levied by both the State and the Central government.
All businesses are required to assess whether the business is liable to register for GST and accordingly obtain GST registration. The unique registration number must be obtained by every supplier affecting taxable supplies, subject to a threshold limit, by registering with the tax authorities so that all the operations and data relating to the business can be correlated and agglomerated.
Check out the below-mentioned eligibility criteria for GST registration and assess whether your business needs to obtain GST registration.
What is GST Registration?
Every supplier affecting taxable supplies, subject to a threshold limit is liable to get his business registered with the tax authorities by obtaining a unique identification code (i.e. GSTIN) from the concerned tax authorities so that all the operations of, and data relating to the business can be agglomerated and correlated.
And this process we call it GST Registration process.
GST Registration Eligibility: Threshold Limit Study
Up to March 2019
- Special category states (Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand) – INR 10 lakhs
- Rest of India – INR 20 lakhs
From 1st April 2019 for businesses who are engaged in the exclusive supply of goods
- Special category states (Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand) – INR 20 lakhs
- Rest of India – INR 40 lakhs
In the 32nd GST Council Meeting held on 10th January 2019, States are given an option to opt for new registration limits or can continue with the previous threshold.
Important Note: The turnover considered here is the aggregate pan-India turnover (including value of taxable, exempt and export supplies) of a business entity, and not state-wise.
Aggregate Turnover & GST Registration Eligibility
Example: ABC Pvt Ltd is a manufacturing unit in Calcutta, West Bengal along with unit at Uttarakhand. Turnover details of all the units are as follows:
|
Calcutta Unit |
Rs. 8 lacs |
|
Uttarakhand Unit |
Rs.11 lacs |
Analysis of GST registration considering the above example
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Analysis No.1 |
Uttarakhand unit falls under a special category state. Hence the threshold limit stays as Rs. 10 lacs to determine GST Registration eligibility |
|
Result |
In the given case, ABC Pvt. Ltd. would be required to take registration in Uttarakhand due to aggregate turnover exceeding Rs. 10 Lakhs (Rs. 11 lacs in the given case) |
|
Analysis No.2 |
Calcutta unit having a turnover of less than threshold limit i.e., Rs. 20 lacs as it does not fall under a special category state. |
|
Result |
|
Separate Registration for each State vs.GST Registration Eligibility
From the results derived at Analysis 2, it clearly means that for each state for which the supplier is liable for registration, the supplier will have to take a separate registration even though he may be supplying goods or services or both from more than one State as a single entity.
Multiple Business Verticals and Eligibility for GST Registration
A person having multiple business verticals in one State may obtain separate registrations for each of the business vertical, subject to prescribed conditions to be eligible for GST Registration.
For this purpose, a business vertical means:
- A distinguishable component of an enterprise
- That is engaged in the supply of individual goods or services or a group of related goods or services
- Which is subject to risks and returns that are different from those of the other business verticals
Documentation Role in GST Registration Process
The person eligible for GST Registration must keep ready the following documents:
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A copy of PAN Card |
Address proof of place of business |
|
A copy of Aadhar Card |
Bank account statement/Cancelled cheque leaf |
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Proof of business registration or incorporation certificate |
Digital Signature |
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Identity and address proof of Promoters/Directors/Partners/Sole proprietor with photographs |
Letter of authorization/Board Resolution for Authorized signatory |
Benefits to Follow: Determining the Eligibility for GST Registration
The registration will confer the following benefits to the registrant:
- Legally recognised as a supplier of Goods and/or Services;
- Proper accounting of taxes paid on the input goods and/or services;
- Utilisation of input taxes for the payment of GST due on supply of goods and/or services or both;
- Pass on the credit of the taxes paid on the goods and/or services supplied to purchasers or recipients.
Know More about GST Registration
GST Registration, GST Registration Certificate, Documents Required for GST Registration, How to Check GST Registration Status, GSTIN
GST
GST Software, GST Calculator, GST on Freight, GST Exempted Goods & Services, Reverse Charge Mechanism in GST, GST Declaration
GST Rates & Charges
GST Rates, GST Rate Finder, HSN Codes, SAC Codes, GST State Codes
GST Returns
GST Returns, Types of GST Returns, New GST Returns & Forms, Sahaj GST Returns, Sugam GST Returns
