The Goods and Services Tax was set in motion from 1st July, 2017. This bill prohibited the cascading effect of the previous taxation system and promotes the notion of the ‘one nation, one tax’ system.
It is important for businesses to understand when they are expected to complete their online GST registration. According to the rules set by this act, it is mandatory for an individual to register under GST if he/she has a business with a turnover of approximately 40 lakhs and above.
GST Registration can be done using the GST new registration online portal, and it takes about 6 working days to complete the registration process.
When will you be Required to Complete the Registration Process?
- If you were entitled to pay the tax for your business or have been already paying the taxation before the GST was implemented
- You will be required to pay the tax if your business comes under the reverse charge mechanism.
- If your business has a yearly turnover that exceeds rupees 20 lakhs in places like Jammu and Kashmir, Himachal Pradesh, Uttarakhand. Whereas, the minimum amount for turnover in other places is rupees 10 lakhs.
- If your business is dependent on an e-commerce aggregator to supply its goods
- If you as an individual is an agent or supplier of goods or if you are an input service distributor.
Documents Required for Online GST Registration.
You will need a copy of all the documents listed below to complete the registration.
- You will be required to upload a copy of your Permanent Account Number (PAN).
- Upload a copy of your Aadhaar Card.
- A canceled cheque and bank account statement of your business.
- You will have to provide an address proof of the location where your business is located.
- A proof showing that your business has been registered.
- A digital signature is required.
- If you are the director of your business, you will have to provide address proof and verification of your identity.
Different types of GST registration.
A taxpayer must be aware of the different types of GST registrations that are available and must register to the appropriate registration-type as per their business.
The different types of registrations are:
A Normal Taxpayer
Most businesses residing in India fall under this category of taxation. A normal taxpayer does not need to provide any deposit for them to come under this category. There is also no expiry date for taxpayers.
A Casual Taxable Person
A person who sets up a shop seasonally or occasionally can opt for this form of registration. This process of GST registration is valid for about 3 months, and the registration process can either be renewed or extended as well.
If an individual is opting to obtain a GST Composition scheme, the taxpayer can adopt this process of GST registration. Taxpayers who opt for this GST Registration will be applied with flat GST rates that must be deposited. The individual taxpayers who come in this category cannot opt for input tax credit.
Non-Resident Taxable Person
For individuals who reside outside India but supply their goods to the residents of India, this GST Registration must be opted by them. This type of registration is similar to ‘Casual Taxable Person’, where the individual taxpayers are expected to pay a deposit of money that is equivalent to liable GST at the time of active GST registration. This type of registration is valid for 3 months, but it can be further extended or renewed as per the requirement.
More examples of GST registration are:
- Non-Resident Online Service Provider
- Special Economic Zone Developer
- GST TDS Deductor (Government Entities)
- UN Embassy/ Body/ other notified individuals
- Special Economic Zone Unit
- GST TDS Collector (E-commerce Companies)
Earlier, an individual was not allowed to take multiple registrations within the same state for the same business vertical. But with the GST Amendment Act 2018, now multiple registrations can be taken within the same state for the same business, while each of them is treated as a separate entity.
GST Registration is not applicable for your business if:
- Your business does not cross Rupees 20 Lakh turnover for goods and Rupees 40 Lakh turnover for Services.
- If you are by occupation an Agriculturist who does the work of supplying crops.
- If your business doesn’t come under the provision of the compulsion of GST registration.
- If the services and goods you sell are exempted from GST registration.
You can apply for voluntary registration for the following reasons:
- To claim Input Tax Credit on purchases.
- To provide a competitive edge.
- For e-Commerce Sales.
- For a registered dealer status.
How to Apply for Online GST Registration?
- Launch your browser and search for the GST portal. Click on the ‘Register Now’ button found on the Taxpayers section.
- Part A of the GST registration process is as follows –
Tap on the ‘New Registration’ option from the list and choose the ‘Taxpayer’ option from the list shown on the screen, followed by selecting the state and district where you belong. Provide the necessary details such as the name of your Business, PAN number, mobile number, and so on. After receiving your OTP, click on ‘Proceed’.
- You will then be redirected to another screen where you will receive a Temporary Reference Number (TRN), which will be sent to your email address and phone number. Make a note of this number.
- Re-visit the GST Portal again and select the ‘Register Now’ button.
- You can now view the draft of the status of your application. Then select the ‘edit’ icon found either at the top or bottom of your screen.
- Part B of your registration process is as follows –
Fill in the necessary details provided in the form and submit the required documents such as your passport-sized photographs, details of your bank account, exact location, and proof of the business.
- Visit the verification Page and select the applicable declarations.
- After successful verification, you will receive an ‘Application Reference Number’ (ARN) to your given mobile and email address.
- You can revisit the GST portal and check the status of your GST registration application using the ARN.
If in any circumstances, the taxpayer does not pay or has delayed the full payment, they will be asked for an additional penalty, which is equivalent to 10% of the tax amount due.