Under the mandates of the Government of India, businesses with a turnover of INR 40 lakh p.a. should be registered as normal taxable entities and file their Goods and Services Tax (GST) in time.
However, the average turnover for businesses to pay GST is different in the North-Eastern Region and the hill states like Uttarakhand, Jammu, Kashmir, Himachal Pradesh, etc. If those businesses have an average turnover of INR 10 lakh p.a., then they should pay the GST like the rest of the businesses across India.
Sometimes, according to the rule of the GST, the threshold limit for GST registration could be INR 20 lakh p.a. for the businesses or they could attract heavy penalties. It must be understood that the GST threshold limit is not regular for the businesses belonging to various Indian states or regions.
These businesses that come under this mandate should file their GST legally. But before that, they need to undergo the GST registration process, which determines which business is entitled to payment of the GST.
GST was introduced in 2017, although the taxation system in India had undergone several reforms years ago. However, the introduction of the GST changed the tax regime completely because it unified a lot of taxes like VAT, service tax, luxury tax, and many more and created a uniform tax filing process.
Businesses or individuals above the threshold limit need to pay GST at every stage of the supply chain to avoid problems and penalties with their operations. This can be done online via the GST registration portal.
As we discussed above, the GST registration process is a government-mandated registration that all businesses, aggregators, and suppliers meeting certain criteria ought to fulfill to register themselves as taxable entities.
This process has been simplified and made entirely digital so that businesses and individuals can register themselves without hassle. There is an online GST Portal where businesses should fill up a form and submit the necessary documents to be considered eligible for GST registration.
If business activities above the threshold limit are carried out without GST registration, then it can be considered a criminal offence. As a result, heavy penalties like jail custody and monetary penalties may apply. A GST registration process via the online GST Portal might take an average of 2 to 6 days.
This article deals with the details of who is eligible for the registration, the documents required for the registration process, and the complete steps that mention in detail the process of GST registration online.
The GST registration process is required to consider a taxpayer eligible under the Government of India’s GST mandate and provide him with a valid Goods and Services Tax Identification Number (GSTIN). The 15-digital GSTIN is provided by the central government and determines whether a business should pay GST.
The following individuals and businesses should be eligible to undergo the GST registration procedure online.
Individuals and businesses that were registered under the pre-GST tax regime and had to pay a number of taxes (VAT, service tax, Excise, etc.) separately.
Businesses with a turnover above the threshold limit of INR 40 lakhs/20 lakhs/10 lakhs, according to the GST laws of the state or the region.
Individuals who pay taxes under the reverse charge mechanism.
Non-resident individuals who are taxable.
Casual taxable individuals.
Every ecommerce aggregator.
An individual who supplies goods and services via an ecommerce aggregator.
Input service distributors and agents of a supplier.
Individuals who are charged with the task of database access and retrieval of online informational services from outside India to Indian citizens who are not registered under the Indian taxpaying regime or don’t pay their taxes.
For GST registration processes online, the following key facts should be considered.
The GST registration process online involves no charges being imposed on the individuals or businesses completing the process.
In the case of a supply of goods and products in various states, GST registration should be completed in each of the states.
For businesses that are eligible for paying GST, if they do not complete the online registration process, 10% of the amount that is due or INR 10,000 will be imposed on them
If there is a case of tax evasion or tax fraud, then 100% of the amount that is due will be imposed as a penalty.
Following is the step-by-step process to complete the GST registration procedure online.
First, you need to visit the official portal of GST - https://www.gst.gov.in
Go to the ‘Taxpayers’ tab. Under that tab, you will find the ‘Register Now’ link.
You have to choose ‘New Selection’ now.
There will be a drop-down menu below ‘I am a. Select the following details from that drop-down menu -
First, select that you are a ‘taxpayer.’
Select the respective state and district from where you or your business belongs.
Next, enter the name of the business.
After this step, enter the PAN of the business.
There will be respective fields for email ID and mobile number. Only insert the active email IDs and mobile numbers as you will get instant OTPs in those.
Enter the image that will be shown on the screen and then click on ‘Proceed.’
5. Once you have proceeded to the next page, enter the OTPs sent to your email ID and the mobile number in the respective boxes.
6. Again click on ‘Proceed’ once the details have been entered successfully.
7. The screen will display a Temporary Reference Number (TRN) which you should take note of.
8. Visit the GST portal again and click on ‘Register’ under the ‘Taxpayer’ menu/tab.
9. Select TRN - Temporary Reference Number.
10. Enter the TRN and the captcha details on the screen.
11. Click on ‘Proceed.’
12. Again you will receive a set of OTPs on your email IDs and registered mobile number. Enter the OTPs in the respective fields and click on Proceed.
13. On the next page, the status of your GST registration application will be displayed. On the right side of the page, there will be an ‘Edit’ icon. You need to click on the ‘Edit’ icon.
14. The next page will have 10 relevant fields or sections. You need to fill up the details and submit the necessary documents where required.
15. You need to upload the following set of documents -
Business address proofs.
Bank details - Bank name, bank account number, bank branch, IFSC Code.
An authorization form.
The constitution of the taxpayer.
16. Visit the ‘Verification’ page. Check the declaration of the application. It is like a preview. Finally, if it is flawless, submit it using one of the below-mentioned methods -
Using the Electronic Verification Code or EVC which will be sent to the registered mobile number.
Using the e-Sign method through which an OTP is sent to the phone number linked to the Aadhaar.
In the case of registration by companies and not individuals, the application will be submitted using Digital Signature Certificate or DSC.
17. Once all these steps are completed, an Application Reference Number of ARN will be sent to the registered mobile number and email IDs used in the process.
18. You can check the status of the ARN on the GST portal to gauge the status of your GST registration.
The GST registration procedure, once completed online, does not impose or include any fees. You will simply receive an ARN via SMS to confirm the GST registration.
After 21 August 2020, new businesses have the liberty to secure their GST Registrations online by opting for their Aadhaar Authentication. The detailed process is given below.
While applying for the GST registration, you will have the option to choose Aadhaar Authentication.
If you select ‘YES’, then the authentication link will be sent to the registered mobile number and email ID.
You need to click on the authentication link.
On the next field that appears, enter the Aadhaar number and select ‘Validate.’
Once there is a match in the details, you will get another set of OTPs to your registered mobile number and email IDs.
You have to enter the OTP to complete the process.
The GST registration will arrive within 3 working days.
To perform GST registration online, you must furnish soft copies of some essential documents as mentioned below.
Identity proof of the individual such as PAN card, Aadhar Card.
Business incorporation certificate.
Address proof of the business premise.
Current bank details of the individual and company.
Address proof, ID proof, and photographs of Directors and Promoters.
Canceled cheque along with the bank account statement of the company.
Appointment proof of authorized signatory.
Digital signature of the business partners and directors wherever applicable.
Apart from the subsumption of multiple indirect taxes, there are several advantages to getting GST registration services done online. A few of them you can find below-
The stand-out point for GST registration is that it saves you money. In the Pre-GST regime, you had to pay tax in every step of the supply chain, and it was added to the next tax value causing double taxation.
But with GST registration, you can eliminate this hassle and pay only one type of tax throughout the business thereby, saving unnecessary expenses.
With an authentic GST registration, small businesses have the access to take big projects from multinational companies by displaying their valid GSTIN.
Ecommerce and online stores can sell goods online without any hassle. Any business or individual can sell goods across the country through various states without worrying about the individual taxes to be paid to each of the state governments.
The GST registration process is simple, and it brings all the businesses from multiple industrial sectors directly under a single umbrella of the taxation process. It is more convenient for small businesses as they can file the tax returns once every quarter and avoid financial burden at the company's nascent stage.
Another advantage of GST registration is the annual turnover limit. Before the advent of GST in India, all individuals having an annual turnover of INR 5 lakh to INR 10 lakhs were liable to pay the tax.
But GST brought in the new law where the companies or entries with an annual turnover of less than INR 40 lakhs are exempt from the taxation system. However, in certain states, the annual turnover for businesses eligible to pay GST should be INR 10 lakhs and 20 lakhs.
Once an individual or a business body completes a GST registration online, the registration itself acts as valid proof of the legal entity of the business or the individual.
With an authentic GSTIN, a current bank account can be opened along with the effortless availability of an input tax credit, when any goods or services are being purchased.
Thus, in short, an authentic GSTIN increases the brand value of the business and helps it prosper.