GST Registration.

 ONE NATION

 ONE TAX

ONE MARKET

The much anticipated GST rollout is set to happen during the Financial Year 2017-18, cutting compliance and improving ease of doing business for millions of small businesses in India. By abolishing and subsuming multiple taxes into a single system, tax complexities would be reduced while tax base is increased substantially. Under the new GST regime, all entities involved in buying or selling goods or providing services or both are required to obtain GST registration. Entities without GST registration would not be allowed to collect GST from customer or claim input tax credit of GST paid. Further, GST registration is mandatory once an entity crosses the minimum threshold turnover of starts a new business that is expected to cross the prescribed turnover.

As per the GST Council, entities in the Northeaster and hill states with an annual turnover of Rs.10 lakhs and above would be required to obtain GST registration. For all other entities in rest of India would be required to obtain GST registration, if annual turnover exceeds Rs.20 lakhs. Entities required to obtain GST registration as per regulations must file for GST registration within 30 days from the date on which the entity became liable for obtaining GST registration.

Acountax is the leading business services platform in India, offering a variety of services like GST registration, GST return filing, private limited company registration, trademark filing and more. Acountaxcan help you obtain GST registration in India. The average time taken to obtain GST registration is about 5 - 10 working days, subject to government processing time and client document submission. Get a free consultation on GST registration and GST return filing by scheduling an appointment with an Acountax Advisor.

Advantages of Goods & Services Tax (GST)

Unified Platform

With the implementation of GST in India, the indirect taxes would be streamlined and standardized. Under GST regime, businesses would no longer have to obtain multiple VAT registration in different States or obtain a separate VAT and Service Tax registration. A single GST registration would be sufficient across India for selling or purchasing goods or providing services.

Subsuming of Taxes

subsumes various other taxes like Central Sales Tax, Additional Customs Duty, Purchase Tax, Luxury Tax, etc., Hence, under GST, many of the taxes in existence today would be subsumed and made into one tax. This would make tax collection and compliance easy for businesses across the country.

Lower Taxes

Currently in some states under the VAT regime, businesses are required to comply with VAT regulations once they cross an annual turnover of Rs.5 lakhs. Under GST regime, GST liability accrues only if an entity crosses an annual turnover of Rs.10 lakhs in northeast or hill states, whereas for rest of India, the threshold is set at Rs.20 lakhs.

Ease of Doing Business

Currently, many businesses like restaurants, computer sales and services businesses have to comply with both VAT and Service Tax regulations. This creates a compliance burden on the business, as they have to calculate taxes for the transaction based on different rates for different items. Under GST, the distinction between goods and services will be gone – making doing business easy.

Larger Tax Base

GST is expected to increase the tax base in India significantly. Hence, the overall tax liability for businesses is expected to reduce overtime, as more and more businesses become compliant. Further, GST will use the latest in technology, including data from Aadhaar database, PAN database, etc., to make GST registration and GST return filing process, as seamless as possible.

Need of GST Registration.

The criteria for persons who should be registered under GST is provided under Chapter 6 of the GST Act. As per the GST Act, the following persons are required to obtain GST registration:

Aggregate Turnover Criteria

Any supplier of goods and/or services who makes a taxable supply with an aggregate turnover of over Rs.20 lakhs in a financial year is required to obtain GST registration. In special category states, the aggregate turnover criteria is set at Rs.10 lakhs.

Special Category States under GST

Currently, Assam, Nagaland,  Jammu & Kashmir, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Uttarakhand, Tripura, Himachal Pradesh, and Sikkim are considered special category states. The National Development Council composed of the Prime Minister, Union Ministers, Chief Ministers and members of the Planning Commission determines the list of special category states in India. Also, the decision to accorded special status to a State is based on factors like: hilly and difficult terrain; low population density and or sizeable share of tribal population; strategic location along borders with neighboring countries; economic and infrastructure backwardness and non-viable nature of state finances.

Mandatory GST Registration Criteria

Some taxable persons who do not qualify for GST registration under the aggregate turnover criteria are required to mandatorily obtain GST registration, if they satisfy any of the following criteria:

Persons making any inter-state taxable supply

Inter-state supply is supplying goods or services from one state to another. Hence, any taxable person who is involved in supplying goods or services to persons outside of the State, is required to mandatorily obtain GST registration.

Casual taxable persons making taxable supply

Casual taxable person is a person who occasionally undertakes supply of goods and/or services and has no fixed place of business. An example of a casual taxable person would be a fireworks shops setup during Diwali festival time, selling fireworks temporarily.

Persons who are required to pay tax under reverse charge

Under GST, for most goods and/or services, the liability for payment of tax rests with the supplier. However, in some cases, the liability to pay tax (GST) would rests with the recipient of the goods or services, instead of the the supplier. Such transactions are called reverse charge. Hence, any person (recipient of goods or service) who is required to pay tax under reverse charge must mandatorily obtain GST registration.

Non-resident taxable persons making taxable supply

Non-resident taxable person is any person who occasionally supplies goods or services to recipients in India, but who has no fixed place of business or residence in India. All non-resident taxable persons are mandatorily required to obtain GST registration, irrespective of aggregate turnover criteria.

Persons who are required to deduct tax under GST

According to Section 51 of the GST Act, the Government may mandate a department or establishment of the Central Government or State Government or local authority or Governmental agencies or a category of persons to deduct tax at the rate of 1% from the payment made or credited to the supplier, where the total value under a contract, exceeds Rs.2.5 lakhs.  Such persons are required to mandatorily obtain GST registration and are referred to as “deductor”.

Persons who make taxable supply of goods or services on behalf of other other persons

Any person who makes a taxable supply of goods or services on behalf of other persons would include agents, brokers, dealers, etc., Such persons are required to mandatorily obtain GST registration.

Input Service Distributor

Input Service Distributor means a supplier of goods or services which receives tax invoices for the receipt of input services and issues a prescribed document for the purposes of distributing the credit of central tax, State tax, integrated tax or Union territory tax paid on the said services to a supplier of taxable goods or services.

Electronic Commerce Operator

Electronic commerce is the supply of goods or service, including digital products over digital or electronic network. An electronic commerce operator is any person who owns, operates or manages digital or electronic facility or platform for electronic commerce. All electronic commerce operators are mandatorily required to obtain GST registration, irrespective of turnover.

Person supplying online information and database access or retrieval services (OIDAR)

Any person supplying online information and database access or retrieval services from a place outside India to a person in India is required to obtain GST registration. Online information and database access or retrieval means
providing data or information, retrievable or otherwise, to any person, in electric form through a computer network.

Persons who supply goods or services through electronic commerce operators

Some persons who supply goods or services through electronic commerce operators, other than supplies where the electronic commerce operator is required to collect tax at source on behalf of the supplier is mandatorily required to obtain GST registration.

Under GST, The Government has the power to specify categories where the tax would be liable to be paid by the electronic commerce operator if the services are supplied through it.

Persons Having Service Tax or VAT or Central Excise Registration

All person who, on the day immediately preceding the appointed day is having a service tax or VAT or central excise license under an existing law is required to be registered under GST. Hence, migration to GST is mandatory for all taxable persons having an existing registration.

Transferee or Successor of a Business

Any person who is a transferee or a successor of a business, that was carried on by a persons registered under GST is required to be registered under GST with effect from the date of such transfer or succession.

 NOT Required to Obtain GST Registration

Any person who is engaged exclusively in the business of supplying goods or services that are not liable to tax under GST or wholly exempt from tax under GST is exempt from obtaining GST registration.

Also, an agriculturist, to the extent of supply of produce out of cultivation of land is exempt from obtaining GST registration. Under GST, agriculturist means an individual or a Hindu Undivided Family who undertakes cultivation of land:

  • By own labour, or
  • By the labour of family, or
  • By servants on wages payable in cash or kind or by hired labour under personal supervision or the personal supervision of any member of the family;

GST Return Filing

GST implementation is set to go-live in 2017, completely overhauling Indias indirect tax system. Under the new GST regime, GST registration would be required for all enterprises involved in the buying or selling or delivery of services exceeding Rs.10 lakhs a year in north-eastern and hill states, while the limit is Rs.20 lakhs for rest of India. All entities having GST registration would be required to file GST returns. GST return filing would be mandatory for all GST registered entities irrespective of if there was any activity / sale during the return filing period.

GST registration holder would have to file GSTR-1 (details of outward supplies) on the 10th of each month, GSTR-2 (details of inward supplies) on the 15th of each month and GSTR-3 (monthly return) on the 20th of each month. Compounding taxpayers would be required to file GSTR-4 every quarter, on 18th of the month next to the quarter. Finally, annual GST return must be filed by all GST registered entities on/before the 31st of December.

Acountax is the leading business services platform in India, offering a variety of services like GST return filing, GST registration,company registration and more. Acountax can help you file GST returns in India. The average time taken to file a GST return is about 5 - 10 working days, subject to government processing time and client document submission. Get a free consultation on GST return filing by scheduling an appointment with an Acountax Advisor.

Advantages of GST Return Filing

Unified Platform

With the implementation of GST in India, the indirect taxes would be streamlined and standardized. Under GST regime, businesses would no longer have to obtain multiple VAT registration in different States or obtain a separate VAT and Service Tax registration. A single GST registration would be sufficient across India for selling or purchasing goods or providing services.

Subsuming of Taxes

Subsumes various other taxes like Central Sales Tax, Additional Customs Duty, Purchase Tax, Luxury Tax, etc., Hence, under GST, many of the taxes in existence today would be subsumed and made into one tax. This would make tax collection and compliance easy for businesses across the country.

Lower Taxes

Currently in some states under the VAT regime, businesses are required to comply with VAT regulations once they cross an annual turnover of Rs.5 lakhs. Under GST regime, GST liability accrues only if an entity crosses an annual turnover of Rs.10 lakhs in northeast or hill states, whereas for rest of India, the threshold is set at Rs.20 lakhs.

Ease of Doing Business

Currently, many businesses like restaurants, computer sales and services businesses have to comply with both VAT and Service Tax regulations. This creates a compliance burden on the business, as they have to calculate taxes for the transaction based on different rates for different items. Under GST, the distinction between goods and services will be gone – making doing business easy.

Larger Tax Base

GST is expected to increase the tax base in India significantly. Hence, the overall tax liability for businesses is expected to reduce overtime, as more and more businesses become compliant. Further, GST will use the latest in technology, including data from Aadhaar database, PAN database, etc., to make GST registration and GST return filing process, as seamless as possible.

GST Return Due Date for Regular Taxpayers

Most taxable persons registered under GST would be termed as regular taxpayers. Regular taxpayers must file 3 returns each month as follows:

GSTR-1 – Statement of Outward Supplies

GSTR-1 or the statement of outward supplies is used to file details of all supplies made by a taxpayer in the previous month and record the tax liability of the supplier. GSTR-1 must be filed on or before the 10th of every month with details of all supplies effected during the previous month.

GSTR-2 -Statement of Inward Supplies

GSTR-2 or the statement of inward supplies is used to file and verify details of input tax credit accrual received during the previous month. GSTR-2 details are auto-populated from the information filed in GSTR-1. Hence, in the statement of inward supplies, the taxpayer must only provide minimal additional information like imports, and purchases from unregistered suppliers. GSTR-2 must be filed on or before the 15th of every month with details of all supplies received during the previous month.

GSTR-3 – Consolidated Return

GSTR-3 is a consolidated return that must be filed by all taxpayers on the 20th of every month. GSTR-3 consolidates the following information already provided by the taxpayer to arrive at final tax payable:

  • Outward Supplies (Auto-Populated from GSTR-1)
  • Inward Supplies (Auto-Populated from GSTR-2)
  • Input Tax Credit availed
  • Tax Payable
  • Tax Paid (Using both Cash and ITC)

GSTR-9 – GST Annual Return

GSTR-9 or Annual GST return must be filed by 31st December of the next financial year by all taxable persons registered under GST. Information provided in GSTR-4 would include details of expenditure and details of income for the entire financial year.

The GST Annual Return must be audited by a practising Chartered Accountant, if the aggregate turnover of the registered person exceeded Rs. 2 crores during a financial year. Further, along with the GST annual return, a copy of audited annual accounts and a reconciliation statement, duly certified by a Chartered Accountant, in FORM GSTR-9C, must be filed electronically through the GST Common Portal.