GST, or Goods and Services Tax, has been one of the most significant taxation reforms India has witnessed in recent times. It is a single unified tax structure replacing all those taxes that previously existed.
Online GST registration is an essential step under the GST regime for every taxpayer or business owner whose annual turnover is above 40 lakh. In some cases with special status such as north-eastern states, the requirement has been lowered to Rs 20 lakh by the government.
The process of GST registration is straightforward and can be done online on the official website of the portal in a few simple steps.
This article discusses everything you need to know about online gst registration, benefits of registering a business under GST, documents required for the process of GST registration and other latest news on gst in India.
Benefits of Registering a Business Under GST
Registration under Goods and Service Tax (GST) gives a host of advantages to the businesses. Some of these are discussed below-
- Provides the business with the status of being legally recognized as a supplier of goods or services.
- Make the businesses legally authorized to collect tax from their buyers and pass on the credit of the taxes paid on the goods/services supplied to buyers or recipients.
- Gives business the benefit of proper accounting of taxes paid on the input goods or services which can be utilized for payment of GST due to the supply of goods or services by the business.
Documents Required for GST registration
- PAN Card of the company
- Complete details and address proof of business (rent agreement/ electricity bill)
- Proof of constitution of the business like Memorandum of Association (MOA) /Articles of Association (AOA), Partnership Deed, or Certificate of Incorporation
- Complete details of authorized signatories including a list of partners along with their identity and address proof in case of partnership firm
- A cancelled cheque of the bank account reflecting the name of account holder, IFSC code, MICR code, and bank branch details
- Digital signature
- Board Resolution/Letter of Authorization for authorized signatory
Process of GST Registration in India
GST registration online is an extensive procedure that requires complete due diligence and detailed knowledge of the GST Act when filing. As a taxpayer, you need to ensure that you’re fully updated regarding GST regulations and are in compliance with those laws to prevent an IRAS tax investigation.
Here is the complete procedure that the businesses need to follow-
- The business/ applicant needs to submit all the essential details including PAN, e-mail address and mobile number in Part A of Form GST REG–01 available either on the GSTN portal or through a facilitation centre (same needs to be notified by the board or commissioner).
- Once the details are submitted, the PAN of the applicant is verified on the GST Portal. Similarly, mobile number and e-mail address are also verified with a one-time password (OTP) sent to the applicant.
- Post the verification, the applicant receives an application reference number on their registered mobile number or via e-mail. At this stage, an acknowledgement is also issued to the applicant in Form GST REG-02 electronically.
- The applicant here needs to fill Part- B of Form GST REG-01 specifying the application reference number followed by submitting the form after attaching all the required documents.
- In case any of the required information is pending from the applicants’ side, it will be sought in FormGST REG-03. Applicants may need to visit the department for this and produce the documents in Form GST REG-04 within seven working days. If there are any errors in the application, it may get rejected, and the applicant will be informed about this in Form GST REG-05.
- In the last step, a certificate of registration gets issued to the applicant by the department after verification and approval in form GST REG-06.
Every business registering under GST get assigned a unique Goods and Services Tax Identification Number, also called as GSTIN.
Who is Liable to Register for GST?
Below is the list of individuals/businesses who need to register for GST-
- All the individuals registered under the Pre-GST law (i.e., VAT, Excise, Service Tax etc.)
- Every business with a turnover above the threshold limit of Rs. 40 Lakhs (Rs. 10 Lakhs for North-Eastern States, Himachal Pradesh and Uttarakhand)
- All the agents of suppliers & input service distributor who are paying tax under the reverse charge mechanism
- All the e-commerce aggregators
- NRI Taxable Person (NRI or handling the business of NRI in India)
- Any person who supply database access/retrieval services or online information from outside India to anyone in India, other than a registered taxable person.
What is the Penalty for not Registering?
Any offender not registering & paying taxes under GST act (for genuine reason/errors) have to pay a penalty of 10% of the total tax amount subject to a minimum of Rs.10,000.
Further, in case the offender has deliberately evaded paying taxes, the penalty is levied at 100% of the tax amount.
Time Limit to Apply For GST Online
An individual/business must apply for GST registration within 30 days from the date on which he becomes liable to registration. All the processes, conditions, and rules of the GST application must follow the registration rules laid by GST Council.
In case of an NRI taxable person (person with no fixed place of business in India) or a casual taxable business (person with no fixed place of business and who operates in a taxable territory only occasionally), the GST registration must be applied at least five days before the commencement of business.
To Conclude
GST registration online is an extensive procedure that requires complete due diligence and detailed knowledge of the GST Act when filing. As a taxpayer, you need to ensure that you’re fully updated regarding GST regulations and are in compliance with those laws.
Apart from bringing in better efficiency in the overall tax collection process, businesses registering for GST also enjoy a lower tax liability due to the change in the indirect taxation slabs under the Goods and Services Tax Act making the process of GST registration beneficial in multiple aspects.
