GST Registration Number

GST is abbreviation for Goods and Service Tax. GST is also known as Value Added Tax (VAT) in few countries. GST / VAT is a consumption based tax wherein the basic principle is to tax the value addition at the each business stage. To achieve this, tax paid on purchases is allowed as a set off/ credit against liability on output/income. GST is levied on all transaction of goods and services. Thus, in principle, GST should not differentiate between ‘goods’ and ‘services’.

Cases in which Compulosry Registration Required

All businesses involved in buying or selling goods or providing services, or both, should register for GST. But for below-listed persons, GST Registration is compulsory.

VAT Converted Taxpayer – All individuals or companies registered under the Pre-GST tax laws like Service Tax or Excise or VAT, etc.

Turnover for Sale of goods – If your sales or turnover of goods is crossing Rs. 40 lakh in a year then GST Registration is mandatory. For the Special Category States , the limit is Rs. 20 lakh in a year.

Turnover for Service provider – If you are a service provider & sales or turnover is crossing Rs. 20 lakh in a year then GST Registration is mandatory. For the Special Category States, the limit is Rs. 10 lakh in a year

Casual Taxpayer – If you supply goods or services, in events/exhibitions, and not have a permanent place of doing business. In such cases, GST is charged on the basis of an estimated turnover of 90 days. The validity of the Registration is also 90 days.

Agents of Suppliers or Input Service Distributor (ISD) – All supplier agents and ISD, to earn benefits of Input Tax Credit, need GST Registration.

NRI Taxable Person – If you are an NRI or handling the business of NRI in India.

Reverse Charge Mechanism (RCM) – Businesses who need to pay taxes under the RCM also need to be GST registered.

E-Commerce Portals & Sellers – Every e-commerce portal (such as Amazon or Flipkart) under which multiple vendors are selling their products. Or for all vendors. You need a GST Registration.

Outside India Online Portal – For suppliers of online information and database access or retrieval services from a place outside India to Indian Residents.

Transferee – When the business has been transferred.

Inter-State Operations – Persons making an inter-state supply. Whatever the turnover.

Brands – Aggregator who supplies service under his Brand or Trade Name.

Other Taxation – Persons who are required to deduct tax u/s 37 (TDS) of the Income Tax Act.

Branches – If your business has multiple branches in multiple states, register one particular branch as main office or head office and the remaining branches as additional. (Not applicable if the business has separate verticals as listed in Section 2 (18) of the CGST Act, 2017.)

Inter-State Registration – If you are a supplier in more than one state you need GST Registration in all the states that you supply goods or services to.

Section 23: Person Not Liable for Registration

*If person is engaged exclusively in the business of supplying goods and/or services that are neither not liable to tax or are wholly exempt from tax under the GST Act
*An agriculturist to the extent of supply of produce out of cultivation of land.

The government from time to time has through notifications specify category of persons not liable for registration.Some of them are discussed below:

*If a person is ONLY engaged in making supply, the tax on which to be paid by the recipient under RCM as per Sec 9(3)
*Suppliers providing services through an ecommerce platform
*Casual taxable person making taxable supplies of handicraft goods.
*Job worker providing inter-state supply to a registered person not liable to be registered u/s 22(1) or who opt to take registration voluntarily u/s 25(3) or who is 
involved in making supply of service in relation to the goods

Special Category States: Under GST, the following are listed as special category states - Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand.

Penalty for not registering under GST
An offender not paying tax or making short payments (genuine errors) has to pay a penalty of 10% of the tax amount due subject to a minimum of Rs.10,000. The penalty will at 100% of the tax amount due when the offender has deliberately evaded paying taxes 

Voluntary GST Registration
Any person or entity irrespective of business turnover can obtain GST registration at any-time. Hence, GST registration is obtained by many businesses in spite of not reaching the aggregate turnover limit. Some of the main reasons for obtaining voluntary GST registration are:

1.To improve the business credibility or transparancy
2.To satisfy the requirements of B2B customers
3.To claim input tax credit(ITC) benefits

4.To Export the goods

5.To not limited in one state

6.To take financial assistance form Bank or Financil Instituatlion by proving their tournover

COMPOSITION SCHEME

Compostion Scheme of GST

The composition scheme under GST is optional and alternative method specially designed for the small taxpayers whose turnover is up to 1.5 Crore (Increased from Rs. 1 Crore) & (Rs. 75 Lacs in case of few states) and the main reason is to reduce the compliance cost (less returns, maintaining books of account & no issuance of  tax invoices).The eligible taxpayer opting this scheme shall be required to pay tax quarterly at a defined percentage of his turnover.

Rate under Composition Scheme

Special Category States where limit of turnover is Rs. 75 Lacs to opt for Composition Scheme

Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura & Himachal Pradesh

The following conditions, must be satisfied in order to opt for composition scheme:

*No Input Tax Credit can be claimed by a dealer opting for composition scheme
*He shall not be involved in the manufacture of items as mentioned in the above para.
*The dealer cannot supply  goods which are not leviable to tax under the GST Act.
*The goods held in stock by him on the appointed day have not been purchased in the course of inter-State trade or imported or received from his branch situated outside the State or from his agent or principal outside the State.
*The goods held in stock by him have not been purchased from an URD and where purchased, he pays the tax under sub-section (4) of section 9
*The taxpayer has to pay tax at normal rates for transactions u/s 9(3) & 9(4) i.e. RCM
*If a taxable person has different segments of businesses (such as textile, electronic accessories, groceries, etc.) under the same PAN, they must register all such 
businesses under the scheme collectively or opt out of the scheme.
*The taxpayer has to mention the words ‘composition taxable person’ on every notice or signboard displayed prominently at their place of business.
*The taxpayer has to mention the words ‘composition taxable person  not eligible to collect tax on supplies’ on every bill of supply issued by him.

Who cannot opt for Composition Scheme?

The following people cannot opt for the scheme-

Manufacturer of Ice cream and other edible ice [Notification No. 14/2019-Central Tax] pan masala [Notification No. 14/2019-Central Tax] Aerated water [Notification No. 43/2019-Central Tax]

All Tobacco and manufactured tobacco substitutes. [Notification No. 14/2019-Central Tax]

A person making inter-state supplies.

A casual taxable person or a non-resident taxable person

Businesses which supply goods through an e-commerce operator

suppliers whose aggregate turnover in the preceding financial year crossed Rs. 1.5 Crores/ 75 lakhs as applicable;
supplier who has purchased any goods or services from unregistered supplier unless he has paid GST on such goods or services on reverse charge basis;