GST REGISTRATION IN INDIA

subhash jha
Aug 9, 2017 · 3 min read

Any person who comes under the sections of persons liable to pay GST shall within thirty days of becoming eligible for GST registration, but, at the same time, a casual taxable person or a non-resident taxable person are liable to apply for registration five days before commencement of business.

Every person is bound to avail registration separately from each state where it operates and where it operates in multiple states and if in a particular state in multiple verticals, separate registration needs to be made. Also, a person making supply from the territorial waters of India shall obtain registration in the coastal State or Union Territory where the nearest point of baseline is located as explained in Section 25(1). If multiple registrations are availed all will be treated as distinct from each other.

The preliminary requirements that are mandatory for a GST Registration are Permanent Account Number (PAN), or, Tax Deduction and Collection Number which would upon application be validated online by the Common Portal from the database maintained by the Central Board of Direct Taxes (CBDT) as stated in the Revised Registration Rules, 2017.This is again not applicable in lieu of a non-resident taxable person.

Also, United Nations Specialized Agencies, Multilateral Financial Institutions under the United Nations (Privileges and Immunities Act), 1947, Consulates and Embassies of Foreign Countries would be granted a Unique Identity Number under GST.

WHO WILL PAY GST?

It is imperative to note that there are two categories of businesses which come under the ambit of GST, one which need to register only and the other category which needs to register as well as is liable to pay taxes. These categories are decided on the based on aggregate turnover which would be calculated using the GSTIN. Aggregate turnover, as defined in the GST Act in the clause (3) of the defining Section 2, is the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis) exempt supplies, goods or services and services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes Central tax, State tax, Union Territory tax, integrated tax and cess.

If the Aggregate Turnover is over 19 lakh then the business is eligible to register on the GST Portal and as soon as the aggregate turnover exceeds 20 lakh, the business becomes liable to pay GST. The aggregate turnover has however has been kept lower for the north-east states at 9 lakh for registration and 10 lakhs for paying taxes. The reason for the lower aggregate turnover is that if it was kept at par with the rest of India the tax collection by these states would reduce by 80% in relation to the present tax collection and as such these states would lose revenue which would in turn affect their revenue and capital expenditure.

However, there are other categories of businesses on which GST Registration would also apply:

  • A business indulged in interstate trade of Goods and Services under Section 24(i)
  • Casual Taxable Person(Section2(20))- A person who undertakes, in any capacity, to make transactions in a state or union territory and has no fixed place of business under Section 24(ii)
  • Reverse Charge (Section 2(98))- Liability to pay tax by the recipient of supply of goods and services or both instead of supplier of the same under Integrated GST Registration under Section 24(iii)
  • Non-Resident Taxable Person (Section 2(77))- same as casual taxable person, but has no fixed place of residence also in India under Section 24(v)
  • People who act on behalf of a taxable person, indulged in trade of Goods and Services under Section 24(vii)
  • Businesses involved in E-Commerce under Section 24(x)
  • Input Service Distributors(Section2(61))- Office of the supplier of goods or services or both which receives tax invoices towards the receipt of input services and issues a prescribed document for the purposes of distributing the credit of Central tax , State tax, Integrated Tax or Union Territory tax paid on the said services to a supplier to taxable goods and services or both having the same PAN as that of the said office under Section 24(viii)
  • Businesses indulged in Trade in E-Commerce under Section 24(ix)
  • An online business based upon aggregator model under Section 24(xi)
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