A business that has an aggregate turnover of over 20 lakhs in a single financial year is required to register under the GST (Goods and Service Tax) regime and the process is called GST registration. GST registration is also necessary for those who are already registered under the excise duty, VAT and other kinds of taxes from the pre-GST system apart from e-commerce aggregators, taxable citizens and non-resident taxpayers.
GST Registration Process
Taxpayers can register for GST online by visiting https://www.gst.gov.in./ and follow the procedure listed below:
• After clicking on the ‘Services’ tab on the left hand side of the home page, one can select the ‘Registration’ tab from the drop down menu and click on ‘New Registration.’
• Under the ‘new registration’ page, one has to mention if he/she is a taxpayer, GST practitioner, or a non-resident person who pays taxes. Then he/she has to enter the name of the state or union territory along with the name of the respective district.
• One is then required to provide the official name of the business that is mentioned on the PAN card and also fill in the Personal Account Number (PAN).
• Separate OTPs (One Time Password) are sent to his/her email address and phone number after he/she fills in the respective details.
• After following the above steps, one has to enter the CAPTCHA code and click on ‘Proceed’.
Documents for GST Registration
Following are the documents that are required for the GST application:
• PAN Card.
• Aadhar Card.
• Memorandum of Association (MOA)/ Articles of Association (AOA), and partnership agreement.
• Rent agreement or electricity bill of the place of business and details.
• Bank account details such as name of account holder, MICR code, IFSC code and bank branch information.
• Digital signature.
• Address and identity proofs of business partners along with photographs.
Once one has applied for GST registration, he/she would receive an Application Reference Number (ARN). The GST application status can be checked through the following process:
• One has to visit the official GST website https://www.gst.gov.in./
• After selecting the drop down menu by clicking on ‘Registration’ one has to select ‘Track Application Status’.
• Then one has to enter the Application Reference Number (ARN) and click on the ‘Search’ button.
• After checking the ARN, one would be informed - if a Provisional ID has been issued; if the application has to be verified; if one has to resubmit the form for error in the PAN details; if the GST migration is successful; and if the registration is cancelled.
The GST application, registration and acquiring a GSTIN are free of cost from the official GST website.
After being successfully registered under GST, a taxpayer would be provided with a 15-digit alphanumeric GST code that is known as the Goods and Service Tax Identification Number (GSTIN). This number is based on the state where the taxpayer belongs and his/her PAN number.
For GST verification online, taxpayers can visit https://www.gst.gov.in/ and follow the steps below:
• On the home page, one can click on ‘Search Taxpayer’ and from the drop down menu select the ‘Search by GSTIN/ UIN’ option.
• Then one has to enter the GSTIN number and click on the ‘Search’ button.
• When the GST number is correct, taxpayers can verify the authorized business name, name of the state, registration date, details of partnership and the type of the taxpayer.
GST Return Form
GST return filing is mandatory and all taxpayers are required to file different GST return forms based on the type of transaction and registration. GST filing is a smooth process as it is done online. There are 11 types of GST return forms for the registered supplier, the recipient, a taxpayer who has chosen the Composition Scheme, a non-resident taxpayer, a taxpayer who is an Input Service Distributor, taxpayers who deduct and collect taxes, a taxpayer with the Unique Identification Number (UIN), and a taxpayer who wants to cancel the GST registration. These types of return forms are categorised as GSTR-1 to GSTR-11.
GST exemption for small businesses
Small businesses get to benefit under the GST regime by opting for the Composition Scheme. They need to file under the GSTR-4 return form and pay their taxes at a fixed rate depending on the type of business and area. However, they are not eligible to claim the Input Tax Credit. Under the Composition Scheme, any supplier from a State or a Union territory, whose annual turnover is below Rs. 20 lakhs and Rs. 10 lakhs for North Eastern States, does not have to register for GST.
Manufacturers who are registered under the Composition Scheme have to pay 2% of their annual turnover and trade dealers have to pay 1%. Taxpayers cannot choose the Composition Scheme if the taxpayer supplies donated goods, manufactures tobacco, supplies goods through e-commerce operators and if he/she is a regular or a non-resident taxpayer. Dealers with the Composition Scheme have to pay tax under the Reverse Charge Mechanism and they also have to pay taxes if they have purchased from an unregistered dealer as well as the GST on the supplies. Unlike regular taxpayers, taxpayers under the Composition Scheme have a minimal amount to pay and the profit margin is much higher.