GST registration - Process, requirement and exemptions

4 October 2022

#gst#tax#compliance#filing#e-commerce#amazon#seller#business#platform

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GST Registration: Process, Requirements, and Exemptions

GST registration is mandatory for all businesses that engage in the supply of goods or services in India, provided their aggregate turnover exceeds the prescribed limits. The Ministry of Finance has simplified the GST registration process to make it easy for businesses to comply with the tax regime. In this article, we will explore the process, eligibility requirements, and exemptions related to GST registration.

Eligibility Requirements for GST Registration

Certain criteria determine whether a business or individual is required to register under the Goods and Services Tax Act. The eligibility requirements include:

Aggregate Turnover:
- Any service provider with an aggregate turnover of more than ₹20 lakhs must obtain GST registration.
- For businesses in special category states, the threshold is reduced to ₹10 lakhs.
- Businesses supplying goods with an aggregate turnover exceeding ₹40 lakhs must also register for GST.
Inter-State Business:
- Any entity engaged in the supply of goods across state borders must register for GST if the annual turnover exceeds ₹20 lakhs (₹10 lakhs for special category states).
E-commerce Platforms:
- All individuals supplying goods and services through e-commerce platforms must register for GST, regardless of turnover.
Casual Taxable Person:
- A person supplying goods and services occasionally (e.g., through a seasonal stall or temporary shop) must register under GST, regardless of turnover.
Voluntary Registration:
- Any entity can voluntarily obtain GST registration. Once registered voluntarily, the business cannot surrender the registration for at least one year. However, amendments to the law now allow businesses to surrender voluntarily at any time.

GST Registration Process

The process of GST registration is straightforward and can be completed online through the GST portal. Once the application is submitted, a GST ARN (Application Reference Number) will be generated, which can be used to track the application status. Here’s a step-by-step guide to completing the registration:

Step 1: Visit the GST Portal

Go to the GST portal at https://www.gst.gov.in/.
Select the “Services” tab, then choose “Registration”, and click on “New Registration”.

Step 2: OTP Validation

After entering the necessary details like PAN and email address, OTP validation will be done via the mobile number and email provided. After OTP verification, a TRN (Temporary Reference Number) is generated.

Step 3: Generate TRN

If you are unable to complete the registration, you can use the TRN to continue the application later.

Step 4: Login Using TRN

Step 5: Provide Business Details

Trade Name: Enter the business name.
Business Constitution: Choose from the dropdown options (proprietorship, partnership, company, etc.).
Commission Code: Select the appropriate code for your business.
Commencement of Business: Provide the date on which the business started or will start operations.

Step 6: Submit Promoter Information

Enter the details of the business promoters or partners. This includes:
- Name, address, contact number, and PAN.
- The designation of each promoter.
- Director Identification Number (DIN), if applicable.

Step 7: Authorized Signatory Information

An authorized signatory will be nominated to take care of compliance and GST filings. Their details should be submitted.

Step 8: Principal Place of Business

Enter the address of the primary place of business, along with contact details (email, phone number).
Submit relevant documents proving ownership or lease agreement of the premises (e.g., property tax receipts, lease agreements).

Step 9: Additional Place of Business (If Applicable)

If the business operates at more than one location (e.g., a seller using Amazon's platform), provide details of the additional place of business.

Step 10: Goods and Services Details

Provide details of the goods and services sold, including their HSN (Harmonized System of Nomenclature) code for goods or SAC (Service Accounting Code) for services.

Step 11: Bank Account Details

Enter details of the bank accounts used for business, including the IFSC code, account number, and type of account. Upload a copy of the bank statement or passbook.

Step 12: Verification of Application

Verify all details before submitting the application. Select the verification checkbox and proceed with the final submission.

Step 13: ARN Generation

After successfully submitting the application, an ARN is generated, and a confirmation is sent to the registered email and phone number.

Documents Required for GST Registration

The following documents are necessary to complete the GST registration process:

PAN card of the business or individual.
Aadhar card of the applicant.
Photograph of the applicant.
Proof of business address (e.g., utility bills, rent agreement).
Bank account details (bank statement or passbook).

Exemptions from GST Registration

Certain businesses and individuals are exempt from GST registration. These exemptions are based on the nature of the supply, and include:

Agriculturists: Farmers supplying agricultural products are exempt from GST registration.
Threshold Exemption: Entities whose aggregate turnover is below the prescribed threshold limit (₹20 lakhs for most states and ₹10 lakhs for special category states) are exempt.
Nil-Rated Supplies: Suppliers of goods or services that fall under the nil-rated category are exempt.
Non-Taxable Goods/Services: Businesses supplying goods or services that are exempt from GST are not required to register.
Reverse Charge Mechanism: In some cases, if the supplier is required to pay tax under the reverse charge mechanism, the recipient is responsible for the registration.

Conclusion

GST registration is an essential step for businesses involved in the supply of goods or services in India. The registration process is relatively simple, and the eligibility requirements are clear. While most businesses with turnover exceeding the prescribed limits need to register, there are specific exemptions for certain categories.

If you are unsure whether your business qualifies for GST registration or need help navigating the process, feel free to reach out to the Dhanaay team for expert advice and assistance.