GST Registration

All businesses must mandatorily register for GST if their annual turnover exceeds Rs.20 Lakh in a fiscal year. However, if a person is exclusively engaged in the supply of Goods, the limit for registration exceeds Rs. 40 Lakh. Businesses within special category states like Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Tripura, and Sikkim are subject to distinct regulations. For GST registration in these states, the law stipulates an annual turnover of Rs.20 Lakh for the supply of goods and Rs.10 Lakh for the supply of services.

For registration, one must make an application through the GST Portal. Owners of businesses can fill out an online form on the GST site and upload the required documents. Carrying out business without registering for GST is against the law, and heavy penalties, including prosecution, are imposed if one does so. Thus, a business owner must register for GST.

Who should register for GST?

Ideally, everyone in business crossing the prescribed turnover limit must register for GST. Even though the threshold limit has been set, businesses under the limit can also voluntarily register for GST.

Benefits of having registration

GST not only eases the taxation process but also removes the tax-on-tax burden, where the tax is paid only on the value addition at each point of the sale and increases transparency. With the implication of GST, unorganized sectors such as construction and textiles will be able to exercise Government-beneficial schemes which apply to GST-registered businesses. Thus, GST registration is not just a legal obligation but also a gateway to participating in the formal economy.

Moving forward, the next question that would arise in the reader’s mind is whether they are liable under the law to register for GST?

In addition to the Annual Turnover criteria for GST registration, as explained hereinabove, every Person (i.e. Individual, Firm, Company, LLP, etc.) who is in business needs to register compulsorily in the following cases:

Types of GST

Presently India has 2 types of GST Component

1. A Person is liable to pay GST under reverse charge
2. Non-resident taxable person supplying taxable goods and services
3. Persons supplying interstate goods and services
4. Persons who provide products or services on behalf of some other registered taxpayer like for e.g. Agents
5. Persons who act as distributors of input service
6. E-commerce operators
7. Aggregators that are supplying services under a brand or trade name
8. Any individual or group of persons notified by the Central or State Government on the recommendations made by the GST Council

To summarise, if one’s business revenue is below the GST threshold, it is not required to register for GST. However, one can still register for GST to avail of various benefits, such as simplifying taxation compliances, eligibility for Government schemes that can help in business growth, increase market competitiveness, thus leading to accessibility to a larger customer base.

What are the main documents required for GST Registration?

Government registrations require varied documents. Similarly, GST registration requires businesses or individuals to submit certain basic documents. Here is a list of the essential documents required for GST Registration:

Documents Required from Client Side:

1. Permanent Account Number (PAN card) of the company, in case of company registration
2. Proof of registration of business
3. Memorandum of Associations/Articles of Associations in case of company
4. PAN card, Aadhaar card and photographs of all authorised signatories. (An authorised signatory is the person authorised by the taxpayer on his behalf to carry out the requirements in the GST portal.)
5. Proof of appointment of authorised signatory
6. Taxpayers photograph
7. Address proof of the taxpayer
8. Address proof of principal place of business
9. Bank account details
10. Digital Signature

GST registration documents for individuals and sole proprietors

A sole proprietorship is a company run by one individual who is in charge of managing and making decisions for the company. It is the simplest type of business structure in India. It is not governed by any special law and has the fewest formalities to set up.

A sole proprietorship is regulated through the Shops and Establishment Act, which defers from state to state for e.g., the Shops and Establishment Act of Delhi is The Delhi Shops and Establishments Act, of 1954. Additionally, there isn’t much documentation needed to start a sole proprietorship firm.

Thus, if one runs a sole proprietorship, the main documents required for GST registration are:

1. Details of Bank account
2. PAN card of the owner
3. Owner’s address proof
4. Owner’s Photographs
5. Owner’s Aadhaar card
6. Proofs for the Place of Business and additional place of business

GST registration documents for companies

A company is an artificial legal entity registered under the Companies Act, 2013. GST registration is important if a company exceeds the revenue threshold as mentioned above. The main documents required for GST registration of companies are:

1. Address proof of principal place of business
2. Company PAN card
3. Bank details
4. Incorporation certificate of Ministry of Corporate Affairs
5. Address proof of all directors
6. Memorandum/ Article of Association
7. PAN card of all directors
8. Signatory’s PAN card
9. Signatory’s appointment proof
10. Signatory’s Aadhaar card
11. A resolution naming the authorized person from the company
12. Proof of the Place of Business and additional places of business