GST REGISTRATION PROCEDURE
GST REGISTRATION PROCEDURE
In 2016, India introduced a big change in its tax system called the Goods and Services Tax (GST). Since then, businesses have been dealing with a lot of confusion and questions about it. Many are unsure if they need to register for GST, and even if they do, they’re not sure what to do next. Let’s break down GST and make it easier to understand so businesses can figure out what they need to do to follow the new tax rules in India.
What is GST ?
The goods and services Tax, it was the single tax system that collected the tax between the manufacturers and consumers. In 1954, France was the first country to implement the GST in the world. After that 140 countries adopted the concept of a tax system. In India, the GST bill was introduced in 2014 in the 122nd Amendment bill of the constitution. Later in 2016, it was renumbered in the 101th amendment act of constitution by the Raja sabha.
Tax is the compulsory acquisition of money by the government authority. The tax system in India is classified as a direct and indirect tax system. The direct tax system denotes that the direct method of collection of money Eg: Income tax. And the indirect tax system denotes the collection of tax for the goods and services or commodities provided. The GST is an indirect tax which is collected for the services.
GST EXEMPTION :
The goods and service tax system is value added tax and it levied on the most of the goods and services sold for domestic consumption. And there should be certain things which are exceptions from the application of the GST.
- Petroleum and tobacco products
- Electricity
- Alcohols
- Stamp duty
Those are exempted from the application of the GST.
Applicability for GST Registration:
The GST registration is required for the shops, enterprises or the companies with a yearly turnover of about more than Rs. 40 Lakhs for goods and Rs. 20 Lakhs for the services. This enables them to avail the input tax credits and other benefits.
The minimum turnover for the GST registration in India is different from state to state. The minimum turnover limit is Rs 20 lakhs for the supply of goods and Rs 10 Lakhs for the services. These categories include Arunachal pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Tripura and Sikkim.
GST LIABILITIES FOR :
The person who are comes under the liabilities of GST are,
- Manufacturer and distributors of goods
- Service company
- E commerce
- Hotel managements etc,
- Suppliers
BENEFITS OF THE GST REGISTRATION :
The GST registration is essential for every business
Inter state trade : The GST is mandatory for the inter state transportation of the goods and the services, it indirectly improves the expansion of the business from other states.
Input tax credit : The GST payer should not pay any direct taxes for the goods and services, utilities, vehicles etc. The input tax credit system which plays the major role to protect them from the other Tax systems.
Legal identity : The registered goods and services products which are legally identified under certain classes. The legal identity should be availed only by registering into the GST.
Loans availability : The registered services can easily get loans from the banks and also available for certain schemes which are covered under the GST.
Compliances : Filing GST returns on time which protects the persons from the fines and penalties.
PROCEDURES FOR THE GST REGISTRATION:
For the process of GST registration the person may follow a certain procedure.
Procedure 2 : New registration of GST
Procedure 3 : Form for GST Registration
Procedure 4 : Verification and submission of the form
Procedure 5 : Approval
Procedure 6 : Certificate
For every GST registration the following procedures must be completed for the approval of the registration.
DOCUMENTS REQUIRED FOR GST REGISTRATION :
Following documents should be required before the GST registration
- Aadhar card
- Pan card
- Address proof of business, eg: Rent agreement, electric bills and other utility bills etc.
- Registration document of the business, eg : Incorporation certificates, Partnership certificate, other sources of certificates.
- Bank account details, the last one year bank statement which is used for the business
- Photo copies.
GST REGISTRATION PROCESS :
Step 1: Signing Up for GST
To register for GST, start by visiting the official government website: https://www.gst.gov.in/. Look for the “Services” section and click on “New registration”. This will open a form where you’ll need to fill in details like your name, address, business information, PAN (Permanent Account Number), email address, and mobile number. Once you’ve filled out the form, submit it, and you’ll receive a 15-digit Temporary Reference Number (TRN).
Step 2: Submitting Forms
After obtaining your TRN, proceed to submit your documents for verification. This includes uploading necessary documents like proof of identity, address, business registration, and bank account details. Additionally, you’ll need to provide information about your business activities and any trade names associated with your business.
Step 3: Aadhar Verification
Once your documents are submitted, you’ll need to select Aadhar authentication for the authorized signatory. An OTP (One-Time Password) will be sent to the mobile number linked with the Aadhar card of the authorized person. After entering the OTP and completing the authentication process online, you’ll receive an Application Reference Number (ARN).
Step 4: Verification Process
Your application will undergo verification by the GST system. In some cases where there are doubts or discrepancies, a physical examination of the documents may be required. If any errors are identified during this process, you’ll be notified to make corrections.
Step 5: Getting Your Certificate
Once your application is successfully verified, approved, and any necessary corrections are made, you’ll receive your GST certificate. This certificate contains your unique GST Identification Number (GSTIN). This GSTIN is essential for all your business transactions and invoice-related activities, as it serves as your identification number within the GST system.
GST NUMBER :
The GST has 15 digit numbers. The first 2 digit numbers are the state code. The next 10 digits are the registered person’s PAN number. The 13th digit indicates the registration of the business in the particular state. The 14th digit is the default character. And the last 2 digits are check codes used to detect the errors in the goods and services.
PENALTY FOR NOT REGISTERING UNDER GST :
There are certain penalties should be levied for not registering under GST,
- Delay in the filing of GSTR : The late fee is Rs 100 per day for each central and state GST, a total of 200 rupees should be charged for the delay of filing. The maximum of RS 5000 is the limit.
- Not filing and not registering GST : The penalty of 10% of the tax due or the amount of Rs 10,000 will be charged for not filing the GSTR.
- Penalty for Fraud : The penalty should be 100% of the tax due and applicable fine amount of 10,000 and also jail.
- Penalty for helping someone to commit fraud : Penalty of rupees 25,000 will be levied for helping someone to commit the fraud in the GST.
- Penalty for not issuing an invoice : Penalty of 100% of tax or Rs 10,000 will be charged.
WHAT ARE THE GST TAX RATES ?
GST tax rates in India, for the various goods and services are divided into four categories :
- 5% GST
- 12% GST
- 18% GST
- 28 % GST
In addition, certain goods and services are exempted from the view of GST. The prices and the tax rates should be only decided by the GST councils by the finance minister of the state and the Union finance minister.
FAQ
FAQ BASED ON GST REGISTRATION :
1. What is the basic applicability for GST Registration in India ?
The GST registration is required for the shops, enterprises with a yearly turnover of about more than 20 Lakhs. And North eastern and the hill regions require 10 lakhs of the annual turnover from the shops. It depends upon the state and the kind of goods the turnover may vary.
2. What are the essential documents needed for the GST Registration ?
In this procedure the following documents should be required before the GST registration.
- Aadhar card
- Pan card
- Address proof of business, eg: Rent agreement, electric bills and other utility bills etc.
- Registration document of the business, eg : Incorporation certificates, Partnership certificate, other sources of certificates.
- Bank account details, the last one year bank statement which is used for the business
- Photo copies.
3. When will the Physical examination happen ?
In some cases of doubt and misinformation or in any mistake the physical examination should happen. After the physical examination by the officer the application should be corrected and submitted the documents before for the process of registration.
4. Who all are applicable for the GST liabilities?
The person who are comes under the liabilities of GST are,
- Manufacturer and distributors of goods
- Service company
- E commerce
- Hotel managements etc,
- Suppliers
5. When will the GST APPEAL PROCEDURE:
If in the case of the GST registration application rejected with the legal queries that challenges any orders or issues. This further procedure is called the GST appeal procedure. The taxpayer should follow the certain steps for the appeal procedures.
6. What are the products which should not come from the purview of the GST ?
- Petroleum and tobacco products
- Electricity
- Alcohols
- Stamp duty
Those do not come under the view of GST.
GST REGISTRATION PROCEDURE
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