With effect from 1st July 2017, Goods and Service Tax (GST) has been introduced in India to combine nine existing taxes into one. In this article, we will be discussing when and who is required to get GST registration in India.
We recommend you to read our article aggregate turnover calculation under GST before getting into this article.
Registration in India can be obtained through an online portal maintained by the Government. The applicant is required to submit an online application along with scanned copy of documents required. To know more, please read our article on Procedure to get GSTIN – Goods and Service Tax Identification Number.
As per the law, a taxable person should obtain registration in every State from where he makes a taxable supply of goods or services or both. We have two limits to decide whether a business is required to have GST registration in India or not. First criteria are based on aggregate turnover.
GST Registration based on Aggregate turnover
As per the law, every supplier shall be liable to be registered in the State or Union territory, other than special category States, from where he makes a taxable supply of goods or services or both if his aggregate turnover in a financial year exceeds 20 Lakh rupees.
Provided that where such person makes taxable supplies of goods or services or both from any of the special category States, he shall be liable to be registered if his aggregate turnover in a financial year exceeds 10 lakh rupees.
Special category states as specified in sub-clause (g) of clause (4) of Article 279A of the Constitution are Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand.
Other cases where GST registration is a must
In addition to the aggregate turnover criteria, we are also required to find out whether a business falls under the below list as specified under GST law or not. Here is the list of cases or categories of persons who shall be required to be registered under GST law irrespective of the above threshold limit.
The following categories of persons shall get registered compulsorily even though these persons do not trigger the provisions as prescribed above:
- persons making any inter-State taxable supply;
- casual taxable persons making taxable supply;
- persons who are required to pay tax under reverse charge;
- persons who are required to pay tax under sub-section (5) of section 9 (electronic commerce operator)
- non-resident taxable persons making taxable supply;
- persons who are required to deduct tax under section 51 (Tax Deduction at Source);
- persons who supply goods or services or both on behalf of other registered taxable persons whether as an agent or otherwise;
- input service distributor;
- persons who supply goods and/or services, other than supplies specified under subsection (5) of section 9, through such electronic commerce operator who is required to collect tax at source under section 52,
- every electronic commerce operator;
- every person supplying online information and database access or retrieval services from a place outside India to a person in India, other than a registered taxable person; and
- Such other person or class of persons as may be notified by the Central Government or a State Government on the recommendations of the Council.
If your case is falling under any of the above lists then it’s mandatory to obtain registration.
In addition to the above list, every person who, on the day immediately preceding the appointed day, is registered or holds a licence under an existing law, shall be liable to be registered under GST law with effect from the appointed day.
When a person is not liable for registration
A supplier shall not be liable for registration:
- if his aggregate turnover consists of only such Goods and/or Service which are not liable to Tax or wholly exempt from tax under this Act.
- an agriculturist, to the extent of supply of produce out of cultivation of land