Unlocking the Benefits of GST Registration for Marketers: A Comprehensive Guide

Introduction

• GST, or Goods and Services Tax, is a comprehensive indirect tax that has been implemented in India since July 1, 2017.
• It has replaced multiple indirect taxes levied by the central and state governments, creating a unified tax system across the country. 
• GST is aimed at simplifying the tax structure, increasing compliance, and reducing tax evasion.

Who is eligible to Register under GST in India?

In India, the following individuals and entities are required to register under GST if their annual turnover exceeds certain thresholds:

1. Businesses that sell goods and have an annual turnover of Rs. 40 lakhs or more (Rs. 10 lakhs for certain special category states).
2. Businesses that provide services and have an annual turnover of Rs. 20 lakhs or more (Rs. 10 lakhs for certain special category states).
3. Any person who is registered under any of the existing indirect tax regimes, such as VAT, Service Tax, Excise Duty, etc.
4. E-commerce operators that provide a platform for selling goods or services and have an annual turnover of Rs. 20 lakhs or more.
5. Non-resident taxable persons who supply goods or services in India.
6. Persons who are required to deduct tax at source (TDS) or collect tax at source (TCS).

What are the Documents Required for GST registration in India?

The documents required for GST registration in India vary based on the type of entity and the category under which the entity falls. Generally, the following documents are required for GST registration:

1. PAN card of the business or entity
2. Proof of business registration, such as a certificate of incorporation, partnership deed, or registration certificate
3. Identity and address proof of promoters, directors, or partners, such as an Aadhaar card, passport, or voter ID
4. Proof of business places, such as rent agreement, property tax receipt, or electricity bill
5. Bank account statement or cancelled cheque of the business or entity
6. Digital signature of the authorized signatory, if applicable
7. In the case of a partnership firm, a partnership deed
8. In the case of a company, memorandum of association and articles of association
9. Photographs of promoters, directors, or partners
10. Authorized signatory letter or board resolution in case of companies

What are the Types of GST Registration?

In India, there are primarily two types of GST registration:

1. Regular GST registration: This type of registration is required for businesses or entities whose annual turnover exceeds the threshold limit for GST registration, as specified by the government. The threshold limit is currently Rs. 40 lakhs (Rs. 10 lakhs for certain special category states) for businesses that sell goods and Rs. 20 lakhs (Rs. 10 lakhs for certain special category states) for businesses that provide services. Regular GST registration is mandatory for businesses that fall under this category.
2. Composition scheme GST registration: This type of registration is an optional scheme for small businesses that have an annual turnover of up to Rs. 1.5 crores. Under this scheme, businesses can pay a fixed rate of tax on their turnover instead of the regular GST rates. However, businesses that opt for the composition scheme are not eligible to claim the input tax credit.

Types of Taxpayers in GST

1. Normal  Taxpayers

Normal taxpayers are entities or individuals who are required to register under GST in India and comply with the provisions of the GST Act. They are also known as regular taxpayers or regular dealers.

Normal taxpayers are required to file GST returns periodically and pay the GST on the goods or services supplied by them. They can claim the input tax credit on the GST paid on their purchases or expenses, which can be set off against the GST collected on their supplies.

Normal taxpayers are required to maintain proper books of accounts and records, and ensure that their GST returns are filed accurately and in a timely manner. They may also be subject to GST audits by the tax authorities and are required to comply with any notices or demands issued by the authorities.

2. Casual  Taxpayers

In India, a casual taxable person (CTP) refers to an individual who occasionally engages in the supply of goods or services in a taxable territory where they do not have a fixed place of business.

CTPs are required to register under GST and obtain a unique identification number (UIN) for the period of their temporary business activities. They are required to file GST returns for the period of their business activities and pay the applicable GST on their supplies.

CTPs are not required to obtain a permanent GST registration, but they must comply with all the provisions of the GST Act during the period of their business activities.

 3. Non-Resident Taxable Person

In India, a non-resident taxable person (NRTP) refers to an individual who occasionally engages in the supply of goods or services in India, but who does not have a permanent place of business in India.

NRTPs are required to register under GST and obtain a unique identification number (UIN) for the period of their business activities. They are required to file GST returns for the period of their business activities and pay the applicable GST on their supplies.

Procedure for GST Registration in India

It is important to note that the entire process of GST registration is online and can be completed within a few working days. However, the time taken for approval may vary depending on the accuracy and completeness of the information and documents provided.

1. Visit the GST portal: Go to the official GST portal at www.gst.gov.in and click on the “Services” tab. Select the “Registration” option from the drop-down menu.
2. Fill in the required details: Fill in the basic details of your business, such as the name, address, and PAN number. You will also need to provide the email ID and mobile number of the primary authorized signatory.
3. Submit documents: Upload the required documents, such as PAN card, Aadhaar card, bank statement, and proof of address of the business.
4. Verify Aadhaar: If you are a proprietor or a partnership firm, you will need to verify the Aadhaar card of the authorized signatory using OTP verification.
5. ARN generation: After submitting the application and documents, an Application Reference Number (ARN) will be generated, and an acknowledgement will be sent to the email ID and mobile number provided.
6. Approval: The GST department will verify the application and documents and may ask for additional information or clarification. Once everything is in order, they will issue the GST registration certificate.

What is the penalty for not Registering under GST?

The penalty for not registering under GST in India includes the following:

• Late fee: A late fee of Rs. 50 per day (up to a maximum of Rs. 5,000) may be levied for delay in GST registration.
• Interest: Interest may be charged on the outstanding GST liability at a rate of 18% per annum.
• Penalty: A penalty may be imposed for non-registration, which is equal to 10% of the tax due or Rs. 10,000 (whichever is higher).
• Prosecution: If a person continues to operate without registering under GST, they may be liable for prosecution under the GST Act, which can result in imprisonment or a fine.
• Disqualification from composition scheme: If a person who is eligible for composition registration fails to register under GST, they may be disqualified from the scheme and may be liable to pay the regular GST rates.

Conclusion

In conclusion, GST registration is mandatory for businesses in India with a certain threshold turnover. It provides various benefits, such as input tax credits and competitive advantage. The registration process is relatively simple and can be done online through the GST portal. It is important to comply with the GST regulations to avoid penalties and ensure smooth business operations.

Frequently asked questions about GST Registration.

Q1. Is GST registration mandatory?

Ans. GST registration is mandatory for certain categories of taxpayers, including those whose annual turnover exceeds the threshold limit of Rs. 20 lakhs (Rs. 10 lakhs for special category states). Failure to register under GST can result in penalties and legal consequences.

Q2. Can I apply for multiple GST registrations? 

Ans. Yes, it is possible to apply for multiple GST registrations in India. Businesses that operate in multiple states are required to obtain separate GST registration for each state, even if it is a single entity. Additionally, businesses that have multiple business verticals in the same state may also apply for separate GST registrations for each vertical. However, it is important to note that separate GST returns must be filed for each registration obtained, and compliance requirements must be met for each registration.

Q3. Can I apply for multiple GST registrations within a state in India?

Ans. Yes, it is possible to apply for multiple GST registrations within a state in India. If a business has multiple business verticals that operate independently in terms of the nature of the products or services provided, then it can apply for separate GST registration for each vertical. This is because each business vertical may have different compliance requirements, tax rates, and input tax credit eligibility.

Q4. What turnover should be considered for the GST registration threshold limit?

Ans. In India, the threshold limit for GST registration varies based on the nature of the business and the state in which it operates.

• For businesses that sell goods, the threshold limit for GST registration is currently Rs. 40 lakhs per annum (Rs. 10 lakhs for certain special category states).
• For businesses that provide services, the threshold limit for GST registration is currently Rs. 20 lakhs per annum (Rs. 10 lakhs for certain special category states).
• It is important to note that the turnover considered for the threshold limit includes the aggregate turnover of all taxable supplies made by the business, whether inter-state or intra-state. This includes the value of all goods and services supplied by the business and excludes any taxes charged under the GST regime.

Q5. What is meant by Composition registration?

Ans. Composition registration is a simplified GST registration option available to small taxpayers in India. It is intended to reduce the compliance burden on small businesses by allowing them to pay GST at a lower rate and with fewer compliance requirements.

• Under composition registration, taxpayers are required to pay a fixed percentage of their turnover as GST instead of the regular GST rates applicable to their goods or services. The rate of GST payable under composition registration varies from 0.5% to 6% of turnover, depending on the nature of the business.

Q6. Who can register for the composition scheme under GST? 

Ans.Small taxpayers whose annual turnover is up to Rs. 1.5 crores can register for the composition scheme under GST. This scheme offers lower GST rates and simplified compliance requirements but restricts the taxpayer from claiming input tax credits and imposes other restrictions on their business activities.

Q7. What are the benefits of registering under GST?

Ans. Here are some of the benefits of registering under GST in India:

• Legality and compliance: GST registration makes a business legally recognized and compliant with the tax laws of India.
• Input tax credit: Registered businesses can claim the input tax credit on their purchases, which can reduce their overall tax liability.
• Business expansion: GST registration enables a business to expand its operations across India by making inter-state supplies and registering for an online marketplace.
• Competitive advantage: Being registered under GST can give a business a competitive advantage by making them eligible to participate in tenders, contracts, and other business opportunities.
• Ease of doing business: The GST system is designed to simplify the tax compliance process for businesses, reducing the compliance burden and promoting ease of doing business in India.

Q8. How to cancel GST registration?

Ans. To cancel GST registration in India, you need to follow these steps:

1. Log in to the GST portal: Go to the official GST portal at www.gst.gov.in and log in using your credentials.
2. Go to the “Services” tab: Once you are logged in, click on the “Services” tab and select “Registration” from the drop-down menu.
3. Select “Application for Cancellation of Registration”: Under the “Registration” tab, select “Application for Cancellation of Registration” from the options available.
4. Fill in the details: Fill in the required details, such as the reason for cancellation, the date from which cancellation is to be effective, and bank account details.
5. Upload supporting documents: Upload the necessary supporting documents, such as the GST registration certificate, proof of closure of business, and others.
6. Submit the application: After verifying the details and documents, submit the application for cancellation.
7. Receive the confirmation: Once the GST department verifies and approves the application, you will receive a confirmation of the cancellation of your GST registration.

Q9. How to activate cancelled GST registration?

1. To activate a cancelled GST registration in India, you need to follow these steps:
2. Log in to the GST portal: Go to the official GST portal at www.gst.gov.in and log in using your credentials.
3. Go to the “Services” tab: Once you are logged in, click on the “Services” tab and select “Registration” from the drop-down menu.
4. Select “Application for Revocation of Cancelled Registration”: Under the “Registration” tab, select “Application for Revocation of Cancelled Registration” from the options available.
5. Fill in the details: Fill in the required details, such as the reason for revocation, the date of cancellation, and bank account details.
6. Upload supporting documents: Upload the necessary supporting documents, such as the GST registration certificate, proof of payment of dues, and others.
7. Submit the application: After verifying the details and documents, submit the application for revocation of cancelled registration.
8. Receive the confirmation: Once the GST department verifies and approves the application, you will receive a confirmation of the activation of your GST registration.