The Basics Of GST Registration In India

Published on 11 Oct 2018 by Shivi

The Good and Services Tax, GST was implemented in 2017 as a consolidated tax replacing the different kinds of indirect taxes applicable in India. GST was implemented to replace the VAT, service tax, excise tax, entertainment tax, entry tax, surcharge, luxury tax and octroi.

GST is applicable on any purchase of goods and services in India, to be paid by the consumer of any goods to the manufacturer, seller or service provider, who then transfer the tax to the concerned government by the way of GST payment and GST returns. The rate of GST differs for different goods and services and are currently divided into four slabs- 5%, 12%, 18% and 28%.

Types Of Goods And Services Tax (GST)

GST system is divided into three types of taxes-

  1. CGST: The full form of CGST is Central Goods and Service Tax. CGST is the Central GST levied by the Central Government. CGST is paid on the purchase of any goods or services in one state and is half the part of total GST collected on every ‘intra-state’ sale and purchase of any goods or services.
  2. SGST: The full form of SGST is State Goods and Service Tax. SGST is levied by the State Government where the goods are sold or purchased. It is the other half of the total GST collected on an intra-state sales and purchase of goods or services.
  3. IGST: The full form of IGST is Integrated Goods and Service Tax. IGST is levied by the Central Government on every sale/purchase of any goods and services from one state to another i.e. on ‘inter-state’ transactions. The tax is collected by the Central Government and distributed equally between the two states.

In order to collect GST from its customers and transmit the tax to the concerned government, a business needs to get registered under the GST regime and obtain a GST Identification Number (GSTIN).

Who Needs GST Registration In India?

Under the Indian GST regime, the following entities compulsorily need GST registration:

  1. When the annual turnover of the entity is more than Rs. 20 lakhs. For entities in north-eastern and special category states, GST is mandatory the annual turnover exceeds Rs. 10 lakh.
  2. When the business is involved in the inter-state supply of goods or services.
  3. When the business has branches in multiple states.
  4. When the business is involved in e-commerce operations, selling its goods or services online.

READ: Impact Of GST On Real Estate Sector

Who Is Not Liable For GST Registration?

Section 23 of the Central Goods and Services Tax Act (CGST) states the persons which do not require to obtain a GST registration:

  1. When the business is dealing with exempted goods or services.
  2. When the entity is an agriculturist i.e. deals with the produces out of cultivation of land.
  3. Any notified person exempted from paying GST upon the recommendations of the GST Council.

Benefits Of GST Registration

By getting a GSTIN registration, a business becomes entitled to the following benefits:

  1. Legal validation as a seller or service provider.
  2. Authority to collect GST from the consumers and claim Input credit for the tax paid on purchases.
  3. Eligibility to claim numerous benefits and avail certain schemes under the GST law.

ALSO READ: GST- A Layman’s Guide

Documents Required For New GST Registration

A business needs to submit the following documents for GST registration:

  1. PAN Card
  2. Proof of business incorporation including the Partnership Deed, Memorandum of Association (MOA) /Articles of Association (AOA), Certificate of Incorporation, etc.
  3. Proof of address/ place of business including the rent agreement (when the property is not owned), or electricity bill, telephone bill, etc. (when the property is owned).
  4. A cancelled cheque.
  5. Identity proof of the authorised signatory including the Voter ID card, passport, Aadhar card, driving license, etc.
  6. Address proof of the authorised signatory including the Voter ID card, passport, Aadhar card, driving license, etc.
  7. Digital Signature Certificate, if applicable.

Procedure of GST Registration

An application for registration of GST must be made within 30 days from the date the enterprise becomes liable to get registered under the GST regime. An application can be made for online GST registration as well by submitting the requisite documents on the government website. Once the application is filed with the documents, a temporary identification number is given.

The GST authority verifies the information provided in the application form and the documents submitted along with it and grants a GST registration certificate in 7 days. The GST certificate also states the 15-digit GSTIN which is an alphanumeric number and serves the purpose of official identification of the GST registration of a business.

When a business is mandatorily required to obtain a GST registration but fails in doing so, it can be subjected to fines and scrutiny from the GST  department. The CGST Act states that anyone who fails to get registered when they’re liable to do so will be subjected to pay a fine of Rs. 10,000 or an amount equivalent to the tax evaded, whichever is more.

Legistify offers online GST registration in India for all kinds of business at highly cost-effective prices. You can call us at 846-883-3013 or send us an email at [email protected] to start your GSTIN registration process.


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