Interstate Suppliers
Interstate supplier has to get registered irrespective of their turnover.
A Complete Guide on Limit of Registration under GST
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The Goods and Services Tax would, therefore, be able to facilitate huge reform in the case of paying taxes in India for businesses. Be it a small business, or be it a startup, or even a well-established enterprise, the GST registration limits are something one should be aware of. In this post, we lead one through some of the salient features of the GST registration limit, threshold calculations, and why compliance matters.
In simple words, the process for getting registered under the GST law, obtaining a GSTIN in the process is called GST Registration . By this, they will be allowed to collect taxes and claim ITC, thus abiding by the laws concerning GST.
The limit on the GST turnover prescribes whether the business needs to get registered under GST or not, and it is provided by the government. It all dependants upon the type or nature of business or profession and, in some cases, depends on the place of business. General GST registration limit
Although the threshold may be different for some states, the business should follow the respective state's criterion.
| Category | Threshold Limit (Turnover) |
|---|---|
| Goods (Normal States) | ₹40 lakhs |
| Goods (Special Category States) | ₹20 lakhs |
| Services (All States) | ₹20 lakhs |
In order to know whether your business has reached the threshold under GST, you have to consider the following:
The value of all the taxable sales transacted by an enterprise, excluding the payment of tax.
Sales related to goods and services wholly exempt under GST regime constitute the total turnover.
Exports should be added to the value of goods and services exported, as exports are also zero-rated supplies.
Supplies between states should form part of the computation for turnover even if the business is below the threshold within a single state.
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Despite the threshold limit for GST, following categories of businesses are bound to get themselves registered. These are:
Interstate supplier has to get registered irrespective of their turnover.
Any person liable to deduct TDS under GST is required to register.
The person who occasionally supplies goods or services in a state must get registration. For instance, a person might have a temporary shop at any exhibition.
The casual person who occasionally supplies goods or services in a state must get registration. Any person liable to pay tax under reverse charge is required to get himself registered for GST.
The non-residents supplying taxable goods or services in India are required to get themselves registered.
The Tax Collected at Source, under TCS entities also have to get themselves registered under GST.
Agents or Intermediaries selling on behalf of someone else have to get themselves registered under GST.
The e-commerce operators are liable to get themselves registered under GST.
Any supplier supplying through an e-commerce platform would be obliged to take registration irrespective of the threshold limit.
Non-resident online service providers supplying services in India are obliged to get themselves registered under GST.
There are many advantages which accrue to an enterprise for being GST compliant, a few of these are discussed as under.
Businesses registered under GST are allowed ITC on purchases, which in turn would reduce the overall tax liability.
Businesses registered under GST attain legal status. This becomes an added reason for expansion of business and its credibility in the market.
The compliance with GST also enhances the company's goodwill and reputation in the market.
Following are the basis on which you will be in a position to determine whether your business crosses the GST registration limit threshold or not:
Aggregate value of all the sales and services carried out in the financial year to determine your aggregate turnover.
Add the foreign export earnings you received when exporting goods and services as part of the business.
Include in number any interstate sales, as those are a important component in establishing you required to register.
Following is a step-by-step simplistic approach for doing registration under GST:
Access the website, www.gst.gov.in , for GST.
Fill the form GST REG-01 and provide all the necessary information.
The documents to be uploaded include PAN, proof of constitution of business, identity proof, and bank account details related information.
The authenticity of the data provided will be cross-checked by the GST department.
You shall issue the GST registration certificate after verification.
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Composition Scheme: The easier compliance option for small businesses whose turnover is below ₹ 1.5 crores. Under this, though the rate of tax would be low, the dealer would not be allowed to claim Input Tax Credit. Rates under the composition scheme are as follows.
| Business Type | Tax Rate |
|---|---|
| Manufacturers | 1% |
| Traders | 1% |
| Service Providers | 6% |
The threshold limits regarding registration to GST are based on the nature of operations. As stated, these are as follows:
₹40 lakhs in the case of most states and ₹20 lakhs in the case of special category states.
₹20 lakhs across all states.
Following are a few of the most searched queries pertaining to GST Registration
GST Registration Limit 40 Lakhs Notification PDF: Check Official notification concerning limits for GST registration ₹ 40 lakhs in turnover
GST Registration Limit in Maharashtra: Services offered by proprietors are required to get registered if the turnover is more than ₹20 lakhs.
GST Registration Limit for Proprietors: Services offered by proprietors are required to get registered if the turnover is more than ₹20 lakhs
GST Registration Limit Notification PDF: You must download the updated notifications from the site itself to keep yourself informed about the developments on this issue.
Service GST Registration Limit: The limit for service providers is ₹20 lakh turnover
Professional GST registration Limit Consulting and freelancing professions have to get registered if the annual income earned is more than ₹20 lakhs.
GST Registration Limit 20 Lakhs Notification PDF Notification confirming the services ₹20 lakh threshold.
GST Registration Limit for Composition Scheme A business with a turnover below ₹1.5 crores can register themselves under the Composition Scheme and pay lesser rates of taxes.
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