Goods & Service Tax: Eligibility, Threshold Limits and Process of Registration

Understand Goods and Services Tax (GST) in India – its eligibility, threshold limits, and the registration process. Learn about the significance of GST, dual GST model, excluded goods, and the key components of GST Acts 2017. Get insights into threshold limits for different states, the voluntary registration process, and the documents required for GST registration. Follow step-by-step instructions on the GST portal for generating a TRN, submitting business information, and completing the registration process. Stay informed about the thresholds for compulsory registration, the role of authorised signatories, and the significance of the principal and additional places of business. Gain clarity on the verification process and the generation of the Application Reference Number (ARN). Master the intricacies of the GST registration procedure for a seamless experience in compliance.

Goods and Services Tax (GST) was rolled out in India with effect from 1st July 2017. GST is one of the greatest tax reforms in India. GST is Destination based Tax is a tax based on the destination or consumption of goods or services. It is different from Origin-based taxation because Origin-based tax is levied where goods or services are produced. In India, Dual GST Model is adopted.

However, few matters are kept outside the purview of GST, such as follows:

1. Petroleum crude;

2. High-speed diesel;

3. Motor spirit (commonly known as petrol);

4. Natural gas

5. Aviation turbine fuel

In respect of these goods, GST would apply from the date when recommended by the GST Council. VAT/ CST Continues on these products.

• Central Excise Duty continues to be levied on the manufacture of these products.
• State Excise Duty continues to be levied on the manufacture of alcohol.
• Tobacco attracts both Excise (By Centre) and GST.

In addition, Tobacco and tobacco products are subjected to GST as well as Central Excise Tax. On Petroleum products imported, IGST is applicable.

**Though electricity has not been explicitly excluded from GST, it is considered as Nil rated in GST and continues to be charged with pre-GST taxes, i.e., electricity duty by the State Governments.

Goods & Service Tax Acts 2017:-

GST comprises of:

1. Central Goods & Services Tax (CGST), levied by the Central Government,

2. State Goods and Services Tax (SGST), levied by the State Government,

3. Union Territory Goods and Services Tax (UTGST) levied by Union Territories,

4. Interstate supplies of taxable goods/services are subject to Integrated Goods & Services Tax (IGST), which is levied by the Central Government and is equal to CGST + SGST.

Threshold limits:-

Any Individual can be registered with GST on a voluntary basis However, certain threshold limits on Aggregate Turnover are provided as per the act;

Limit of ₹ 10 Lakh for Supplier of goods and/or services:

1. Manipur,

2. Mizoram,

3. Nagaland, and

4. Tripura

Limit of ₹ 20 Lakh for Supplier of goods and/or services:

1. Arunachal Pradesh

2. Meghalaya

3. Puducherry

4. Sikkim

5. Telangana

6. Uttarakhand

Limit of ₹ 20 Lakh for Supplier of goods and/or services and limit of ₹ 40 lakh for suppliers of goods (Intra-state)

1. Jammu & Kashmir

2. Assam

3. Himachal Pradesh

4. And all other states

**AGGREGATE TURNOVER WILL BE COMPUTED ON ALL INDIA BASES FOR THE SAME PAN,

And Includes:-

And excludes:-

1. CGST/SGST/UTGST/IGST/Cess,

2. Value of inward supplies on which tax is payable under reverse charge.

Compulsorily registration applicable: –

1. Casual taxable persons.

2. Non-resident casual taxable persons.

3. Persons making any inter-state taxable supplies.

4. Agents acting on behalf of a registered taxpayer.

5. E-commerce operators.

6. TDS/TCS deductors.

7. Persons conducting business in a state other than the one they are located in.

8. Persons who sell products on e-commerce sites.

9. Individuals working in the import-export industry.

10. Persons subject to reverse charge taxation.

11. Businesses registered under previous taxes such as VAT, excise, and service tax.

12. Individuals running an aggregator company.

13. Enter Service Distributors.

14. OIDAR (Online Information Database Access and Retrieval) service providers in India.

Procedure of GST Registration:-

Documents Required:-

1. Passport Size Photograph (Proprietor/Partners in case of a Partnership Firm/ Designated Partners in case of LLP/ Directors in case of a company).

2. PAN Card (Proprietor/ Partnership Firm/LLP/Company).

3. Proof of Address of the Registered Place of Business. (Electricity Bill/ Utility Bill/Legal Ownership Document/ Municipal Khata Copy/ Property Tax Receipt)

4. Rent Agreement/ Lease Deed (In case of Rented/ Leased Property)

5. Non-Objection Certificate from the Owner of the Place of the Business Situated (in case of Consent/ Rented).

6. Bank Account Details (Statement/Cancelled Cheque /Passbook)

7. Address Proof of Proprietor (In case of Proprietorship)

8. Proof of Constitution of Business (Partnership Deed, in case of Partnership Firm/ Certificate of Incorporation in case of an LLP or a Company)

9. Proof of the Appointment of Authorized Signatory. (Board Resolution for Authorizing the Director or Managing Committee and Acceptance Letter in case of Company/ Letter of Authorization of Designated Partner in case of an LLP)

Steps to Follow for Registration:-

A. Access GST Portal

-> https://www.gst.gov.in/ > Services -> Registration > New Registration option.

B. Generate a TRN by Completing OTP Validation

1. The new GST registration page is displayed. Select the New Registration option. If the GST registration application remains incomplete, the applicant shall continue filling the application using TRN number.

2. Select the Taxpayer type from the options provided.

3. Choose the state as per the requirement.

4. Enter the legal name of the business/entity, as mentioned in the PAN database. (As the portal verifies the PAN automatically, the applicant should provide details as mentioned in the card.)

5. In the Permanent Account Number (PAN) field, enter the PAN. (PAN of the Proprietor in case of Proprietorship Firm/PAN of the firm in case of the Partnership Firm/ PAN of LLP in case of an LLP/ PAN of the Company in case of a Company)

6. Provide the valid email address of the Primary Authorized Signatory.

7. Click the PROCEED button.

C. OTP Verification & TRN Generation

On submission of the above information, the next step is the OTP Verification page.

Hence, enter the two separate OTP sent to validate the email and mobile number.

1. In the Mobile OTP field, enter the OTP.

2. In the Email OTP field, enter the OTP.

* OTP will be valid only for 10 minutes.

On successfully completing OTP verification, a TRN will be generated. TRN will now be used to complete and submit the GST registration application.

D. Log in with TRN

Once TRN is received, the applicant shall start the further procedure by logging in with the TRN generated. In the TRN field on the GST Portal, enter the TRN generated and enter the captcha text as shown on the screen. Complete the OTP verification on mobile and email.

Now, click on the icon marked in red to start the GST registration process.

E. Submit Business Information

Various information must be submitted for obtaining GST registration. In the first tab, business details must be submitted.

1. In the Trade Name field, enter the trade name of the business.

2. Enter the Type of Constitution of the Business from the drop-down list.

3. Enter the District and Sector/ Circle / Ward / Charge/ Unit from the drop-down list.

4. In the Commissionerate Code, Division Code and Range Code drop-down list, select the appropriate choice.

5. Applicant may choose the Composition Scheme, if applicable as per the act.

6. Enter the date of commencement of business.

7. For the Date on which liability to register arises, the applicant may choose the date of the beginning of the business, if the applicant is registering on a voluntary basis otherwise, this is the day the business crossed the aggregate turnover threshold for GST registration.

**Taxpayers are required to file the application for new GST registration within 30 days from the date on which the liability to register arises. Further applicability of the rules can be referred as per the Act.

F. Submit Information

In the next tab, provide information. (Proprietor’s details in the case of a Proprietorship/ Partners details in case of a Partnership Firm/Designated Partners’ details in case of an LLP/ Directors’ details in case of a Company. Details of up to 10 Partners/ Designated Partners/ Directors can be submitted in a GST registration application.

The following details must be submitted:

1. Personal details like name, date of birth, address, mobile number, email address and gender.

2. Designation

3. DIN

4. Details of citizenship

5. PAN & Aadhaar

6. Residential address

In case the applicant provides Aadhaar, the applicant can use Aadhaar e-sign for filing GST returns instead of a digital signature.

G. Submit Authorised Signatory Information

An authorised signatory is a person nominated by the Directors of the company. Hence, the nominated person shall be responsible for filing GST returns of the company. Further, he/she shall also maintain the necessary compliance of the company. The authorised signatory will have full access to the GST Portal. The person shall undertake a wide range of transactions on behalf of the promoters.

H. Principal Place of Business

In this section, the applicant shall provide the details of the principal place of business. The Principal Place of Business is the primary location from where the taxpayer operates the business. (In the case of a company or LLP, the principal place of business shall be the registered office)

For the principal place of business enter the following:

1. Address of the principal place of business.

2. Official contacts such as Email address, telephone number, mobile number field and fax number.

3. Nature of possession of the premises.

If the principal place of business is located in SEZ or the applicant acts as SEZ developer, necessary documents/certificates issued by the Government of India shall be submitted.

In this section, upload documents to provide proof of ownership or occupancy of the property accordingly, mentioned above.

I. Additional Place of Business

If the applicant has any additional place of business then the details can be entered in this Tab.

J. Details of Goods and Services

In this section, the taxpayer must provide details of the goods and services supplied by the applicant (top 5).

In case of goods supplied, provide the HSN code and In case of services, provide SAC code.

K. Details of Bank Account

In this section, enter the number of bank accounts held by the applicant. Then provide details of the bank account like account number, IFSC code and type of account. Upload a copy of the bank statement or passbook as a proof.

L. Verification of Application

In this step, verify the details submitted in the application before submission. Once verification is complete, select the verification checkbox. Then select the Name of Authorized Signatory in the drop-down list. Enter the place where the form is filled. Verification can be done by using Digital Signature Certificate (DSC)/ E-Signature or EVC.

* In the case of LLP and Company, Digitally signing using DSC is mandatory.

M. ARN Generated

On submitting the application, the success message is displayed. The acknowledgement shall be received at the registered e-mail address and mobile phone number.

After that Application Reference Number (ARN) shall be generated and receipt of the same shall be sent to the e-mail address and mobile phone number.

Using the GST ARN Number, the status of the application can be tracked.

After submission of the application GST department shall review the application and if it deems fit then shall issue a Certificate of Registration in Form REG-06.

However, In case of any discrepancy in the application, the GST department shall issue a show cause notice in Form REG-03. Within 15 days applicant shall file further clarification with required documents and details.

Once the clarification is submitted, then Department shall issue Certificate of Registration in Form REG-06 if it deems fit or if not then shall issue the rejection notice in Form REG-05.