Before getting into detail about what is GST registration, let us first look at what is GST :
What is GST?
Nowadays everyone knows what it is. But let’s have a recap, shall we? On 1st July 2017 Government of India launched what we call now, “GST” under the governance of Prime Minister Narendra Modi. But, the concept of GST was first proposed during the government of Atal Bihari Vajpayee. So, after almost two decades it returned. We pay GST when we buy food items, clothes, electronics, transportation, etc. We do not pay it directly to the government but, it works in a chain. Before the product reaches the customer, there are producers, wholesalers, and retailers. They add this tax and the last person in this chain, to complete it is us! The customers.
What is GST Registration?
GST registration is a process through which the taxpayer registers himself/herself under GST. After the registration is done, the seller gets a unique ID. And that unique ID is known as Goods and Services Tax Identification Number (GSTIN). The number is assigned by the central government and is a 15-digit number. And the seller will need a different GSTIN if his/her business is in a different state.
Now, not every other business person has to register for the number. Those businesses whose yearly turnover exceeds 40 lakh rupees are required to apply. And for states such as Jammu and Kashmir, Himachal Pradesh, Uttarakhand, and those in North-East are required to apply if their business has a turnover of 10 lakh rupees per year.
There are a few businesses, which, irrespective of the turnover, have to register for GST:
- Input Service Distributor (ISD)
- Business supplying goods inter-state
- A business supplying through e-commerce medium
- Service providers
- TDS/TCS deductor
- Non-resident taxable person
Types of GST registration:
- Normal taxpayers
Most businesses in our country fall under this category. As we read previously, businesses whose turnovers are more than 40 lakh rupees are required to register as normal taxpayers. And those in North-Eastern states, Himachal Pradesh, Uttarakhand, and Jammu, and Kashmir have the turnover of 10 lakh rupees have to register for the same.
- Casual taxable individual
People who are starting their business and are just seasonal can apply under this category. Businesses need to make a deposit equal to the GST liability from the occasional operations. The tenure for registration is 3 months. But it can be renewed.
- Non-resident taxable individual
Business owners who occasionally come to the country for business or supply goods here are required to fill the GST registration in this category. Again here, the tenure is 3 months but they can extend.
- Composition registration
Businesses with an annual turnover of 1 crore rupees have to apply in this type of registration. Businesses have to pay to fix a fixed amount of GST irrespective of their actual turnover.
How to do GST Registration?
The process to obtain a GSTIN is hassle-free. A citizen wanting a normal registration can visit the GST portal and apply.
What are the documents required for GST registration?
To register your business, you will need the following list of documents:
- Photograph of the applicant
- ID proof (any two)
- Aadhar card
- Election card
- PAN CARD
- Constitution documents
- Proprietor: Shop Act Registration/Intimation
- Partnership Firm: Partnership Deed, Certificate of Incorporation in case of LLP
- Company (Private Ltd/OPC, Public Company): Certificate of Incorp
- Proof of Principal Place of Businesses Owned:
- Property Tax paid receipt, Light Bill, Sale deed, Index II (Anyone)
- Rented: Registered rent Agreement, Light bill
- Bank Account of Business (Any one)
- Canceled Cheque.
- Copy of Bank Statement.
- The first page of Pass Book
- Address proof of residence (any one)
- Light bill
- Telephone bill
- The property tax paid receipt
- Digital signature if available
Penalty for not registering under GST:
All the businesses required to register under GST mandatorily will have to pay a penalty of 10% of the tax amount payable up to a maximum of Rs 10,000.