The law mandates that every person engaged in business of selling taxable goods and services is required to obtain a registration under GST. However, small businesses having a turnover below the threshold limit or exclusively dealing in exempted goods and services are exempt from taking registration under GST. GST registration is State wise and businesses having operations in more than one State will have to obtain registration in all those States. Once registered, a business needs to undertake various legal compliances including filing of GST returns and payment of GST.
Every registered person under GST will be granted a unique GST identification number. GSTIN is a 15 digit PAN based number.
Businesses with an outward aggregate turnover upto INR 20 Lakhs is exempted from obtaining registration under GST. This exemption limit has been kept at INR 10 lakhs for businesses situated in States of J&K, Himachal Pradesh, Uttranchal, Sikkim and 7 North Eastern States. However, this exemption does not applicable is a business is engaged in making inters-state outward supply of goods and services. Certain persons such as persons selling to electronic commerce operator, input service distributor, casual taxable person, person liable under reverse charge mechanism, etc. are mandatory required to obtain registration under GST.
The registration process under GST is online and easy. The registration application needs to be filed within 30days of becoming liable to obtain registration under GST. The process requires a person to log on to GST.gov.in and file an application for registration and upload the required documents. The application can be signed electronically either through digital signature certificate or OTP based aadhar card verification /EVC. The application submitted online is verified by the GST authorities within 3 days and a registration certificate is thereafter granted. No personal visit is required to be made to the office of the tax department.
Migration to GST
For business that were already registered under the erstwhile excise duty, service tax or VAT, the GST migration process was started in November 2016. The businesses were given provisional login details to access the GST portal. The process entailed businesses re-submitting various information and documents and then submitting it electronically. The GST migration window for those who have not undertaken this process is open will September 2017.
A business can voluntary also apply for registration under GST even if not mandatorily required to register under GST. Once GST registration is applied for, all provisions of GST law becomes equally applicable on such person including those of GST return and payment compliances.
A small business having a turnover upto INR 75 lakhs can opt for composition scheme. The turnover limit is INR 50 Lakhs for J&K, Himachal Pradesh, Sikkim and 7 North Eastern States. A composition dealer has to pay a fixed percentage of his turnover as GST to the Government. He is not entitled to avail input tax credit and can neither pass on the credit. The scheme is available only to a trader (1%), manufacturer (2%) and a restaurant (5%).
Casual Taxable Person
A person who occasionally supplies goods and services is a State where he does not have a fixed place of business is required to obtain a casual taxable person registration. The registration is generally valid for a period of 90 days. This registration is useful for business such as persons selling goods in exhibitions in other States.
Multiple Registrations in the same State
GST encourages businesses to obtain a single GST registration in one State. However, businesses having different business verticals can opt for obtaining separate registration for different business verticals.
Penalties for not taking registration
A business which is required to obtain registration and which fails to obtain the same can be made liable to pay a penalty of INR 10,000. Additionally, it may become liable to penalty on account of non-payment of GST on turnover effected during the unregistered period.