GST (Goods & Services Tax) Registration| Talwarassociates.co.in

GST (Goods & Services Tax) Registration

What is GST (Goods & Services Tax) Registration

Concept: - Goods and Services Tax is a consolidated indirect tax that encompasses within itself VAT, CST, Central Excise duty, Basic Excise Duty, Entertainment Tax, etc and is valid all over India with effect from 1st July 2017.
When to register for GST: - Mandatory to register under GST when annual turnover exceeds INR 40/20 lakh or supply of goods and services is made inter-state or through E-commerce platform.
What are the GST tax rates: - Tax rates vary from 0% to 28% depending upon the type of goods & the nature of the services provided.
Input Tax Credit Availment:- Only businesses registered under GST can avail input credit of tax paid at the time of purchase while filing of GST returns.
Return Filing & Payment: - Every GST registrant requires to file three monthly/quarterly returns and One Annual Return(GSTR-9). Tax is to be paid every month.
Composition Scheme: - Business Unit having an annual turnover less than INR 1.5 crores may opt the composition scheme. Required to pay subsidized tax ranging from 1% to 5% & file quarterly returns.

When is GST Registration Mandatory in India

Turnover Criteria: - All taxpayers who have an annual turnover by sale of trading of goods above 40 lakhs are required to get a new GST registration. All tax payers who have annual turnover above 20 lakhs through services are required to get a new GST registration.
Causal taxpayer: - If you supply goods or services in events/exhibitions where you do not have a permanent place of business, you need to get online GST Registration before starting a business. Such a dealer has to pay GST on the basis of an estimated turnover of 90 days. The validity of causal GST Registration is 90 days.
NRI taxpayer: - NRI taxpayer, who does not have a place of business in India, wishes to start a business, then he has to apply for GST Registration in India before beginning operations in India. The validity of a new GST registration is 90 days.
Agents of a Supplier & Input Service Distributor (ISD):- All Input service distributor(ISD) who want to carry-forward benefit of input tax credit require to get a new GST registration.
Reverse Charge Mechanism (RCM):- A business which requires to pay tax under the reverse charge mechanism need a new GST Registration.
E-Commerce portal: - Every e-commerce portal (such as Makemytrip or Flipkart or Amazon) under which multiple vendors are selling their product require a new GST registration.

Why I need GST Registration

GST registration not only helps you in getting your business recognized as a legal registrant but also opens a number of opportunities for your business. Benefits to your business GST registered are as follows:-

Become more competitive: - You will be more competitive in comparison to your unregistered competitors since you will carry a valid GST registration certificate.
Expand your business Online: - You cannot sell products or services on E-commerce platform without a GST registration. If you're planning to sell on E-commerce platforms like Flipkart, Amazon, Paytm, Nykaa or CarDekho you must have a GSTIN or a GST registration.
Can avail input tax credit: - Only Registered GST certificate holders can avail input of GST tax paid on their purchases.
Can Buy and sell all over India without any restrictions: - Without having (GSTIN) GST no. you cannot trade in inter-state. This is possible only if you have registered your business under GST.
Apply for Government Tenders: - Various government tenders require GSTIN to apply for a tender. If you do not have, a GST registration you shall miss the bus.
Open a Current Bank Account: - In case of a sole proprietor business Banks & Financial Institution do not open a current bank account in the name of business trade name unless you carry any government proof in the name of your business. GST registration certificate can help you to open a current bank account.
Dealing with Large Corporates (MNC):- Generally, MNC’s are not comfortable to deal with small business entities until they carry a valid tax registration proof. GST registration is one of them.
MSME: - CGTMSE Loans are available only for GST registered businesses.

What is GST Composition Scheme

GST Composition Scheme is for the small taxpayers, which has been framed to reduce the tax compliance burden. Small taxpayers need not to file monthly GST returns and can pay nominal GST at a fixed rate of turnover. Any business having an annual turnover up to 1.5 Crore can opt for GST registration under composition scheme.

Regular Vs. Composition Scheme

	Particulars	Composition Scheme	Regular Scheme
1	Tax Invoice	Composition taxpayers can not issue tax invoice to their customers.	Normal taxpayers can issue tax invoice to their customers.
2	Tax Rate	Composition taxpayers need to pay nominal GST at a fixed rate of turnover, which is normally 1-5%.	Tax rate for regular taxpayer’s goods and services, which is from 0-28%.
3	GST Return Filing	Composition taxpayers required to file quarterly return.	Normal taxpayers required to file monthly return.
4	Input Tax Credit	Composition taxpayers cannot avail Input tax credit benefit.	Normal taxpayers can avail Input tax credit benefit.
5	Compliance	Relaxed Compliance in order to safeguard small businessmen.	Normal compliance required.

Documents Required for new GST Registration

1. PAN Card of the Business or Applicant or Individual: - GSTIN is PAN based. Hence, PAN card forms the basis of GST certificate.

2. Identity and Address Proof of Promoters: - documents like PAN, passport, driving license, aadhaar card or voters identity card must be submitted for all the promoters.

3. Address Proof for Place of Business:- Documents like rental agreement or sale deed along with copies of latest electricity bill or latest property tax receipt or municipal khata copy and a NOC(No Objection Certificate) from landlord in case of rental properties, must be submitted as the address proof as mentioned in the GST application.

4. Bank Account Proof: - Scanned copy of the first page of bank passbook or statement showing a few transactions and address of the business must be submitted for the bank account details mentioned in the GST registration application.

Types Of GST Returns

GSTR 1

This return furnishes details of all sales including B2B and B2C. Due date of this return is 11th of every month and in case of a quarterly return, the end of next month of every quarter.

GSTR 3B

This is a summary return with details of net tax liability based on the output & input tax. Due date of this return is 20th of every month.

GSTR 4

A business who opts for composition scheme and needs to pay at subsidized GST rates from 1% to 5% & file this quarterly return.

GSTR 8

An e-commerce operator which needs to collect TCS (Tax collected at source) under GST requires to file this return till 10th of every month.

GSTR 9

This is the Annual GST return, which is to be filed by all registered persons till 31st March of every financial year. Applicable for turnover above Rs. 2 crores.

GSTR 9C

This is the Annual GST return, reconciliation statement for reconciliation of tax and Input tax credit. Applicable for turnover above Rs.5 crore.

GSTR 2A

This is the monthly statement that reflects all input tax credit, eligible for claim by a GST registered business.

GSTR 2B

This is the monthly statement that reflects all input tax credit, that can be availed by a GST registered business.

WHY FILE GST RETURNS ON TIME

Avoid Penalty – Failing to file GST Returns on time will attract a penalty of INR 200 per day and maximum up to INR 5000 of each return
Avoid Registration Cancellation – If you don’t file GST Returns on time your certificate might get cancelled.
Better Relationship with your prospects – Filing GST Returns on time will let your customers claim input credit smoothly and timely hence maintaining a healthy relationship with good prospects
Ease of availing loan – Timely and accurate GST Return filing helps a taxpayer in applying for loans from banks, CGTME or any financial institution. The Banks ascertain a taxpayer's credibility on the basis of his GST Returns filed on time.
E-Waybill generation – In order to ensure regular compliance and GST return filing, the finance ministry has now restricted E-Way bill generation for transportation of goods, in case the trader/service provider has not filed GST returns for 2 successive months.
Limitation: With recent notification GST returns if not filed for last 3 years shall be time barred and not allowed to be filed.