All about Registration in GST

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All about Registration in GST

 

 

Author

CA. Yashika Pittie Bhageria

 

 


Registration is a fundamental requirement under any tax regime which ensures identification of tax payers and tax compliance in the economy. Without registration a person can neither collect tax from customers nor claim any credit of taxes paid by him.

Legal provisions relating to registration under GST are enumerated below:

  • Section 22 to 30 of CGST Act, 2017
  • Provisions of CGST Act are to be read with rules 8 to 26 prescribed under CGST Rules, 2017
  • Section 20 of IGST Act, 2017 and Section 21 of UTGST Act, 2017

R egistration Scenario Pre and Post GST

I mplementation

  1. Service provider was required to get registered with Service Tax department
  2. Either centralised or premise wise registration was required

  1. Trader of goods was required to get registered with VAT department
  2. State wise registration was required

  1. Manufacturer of goods was required to get registered with Central Excise, VAT Department and also Service Tax department in certain scenarios
  2. Factory wise registration with few exceptions where centralized registration was permitted

  1. Manufacturers, traders and service providers are all covered under GST law
  2. State wise registration is required

  Important Notes:

  • Branches in different states – separate registration for each branch
  • Multiple branches in same state – separate registration may be obtained for ease of doing business otherwise while registering one branch should be shown as principal place of business and others as additional place of business (separate business verticals criteria is removed)
  • Registration under GST is not tax specific, which means there is single registration for all taxes e. CGST, SGST/UTGST, IGST and cesses
  • Person making supply from the territorial of India to obtain registration in the coastal state or Union territory where the nearest point of baseline is located

Section 2(6) of CGST Act, 2017 – Meaning of A ggregate Turnover

  • Taxable supply
  • Exempt supply (includes non taxable supply)

Aggregate Turnover Includes

  • Exports
  • Interstate supply
  • Outward supply under reverse charge

Aggregate Turnover Excludes

  • Inward supply liable for reverse charge
  • CGST, SGST/UTGST, IGST, Compensation cess

 Important Notes:

  • Aggregate turnover is to be calculated on all India PAN basis and not state wise (total turnover of all branches in all states with same PAN)
  • Aggregate turnover to include exported, exempted and inter-state supplies between distinct persons under same PAN of all goods and services
  • Aggregate turnover of principal to include goods supplied directly from job worker’s premises
  • Aggregate turnover to include all supplies made by taxable person whether on his own account or on behalf of all principals

S ection 22 of CGST Act, 2017 – Person liable

f or Registration

The following persons are liable to get registered as per Section 22 of CGST Act:

Aggregate Turnover Basis


Person making taxable supply of goods/services/both having aggregate turnover in a financial year exceeding Rs 20 lakhs or Rs 10 lakhs as applicable (refer table in Point 2  

Holding Registration in Pre-GST Era

Every person who was registered under earlier indirect tax laws shall be liable to registration under GST w.e.f 22nd June, 2017

  

Transfer of Business

Registered person making taxable supply transfers his business as a going concern to another person (transferee), then transferee needs to get himself registered

 

In case of Amalgamation/Demerger

Registered person making taxable supply transfers his business in the scheme of amalgamation/demerger to another person (transferee), then transferee needs to get himself registered

 

Important Notes:

  • Registration is required for the place from where taxable supply takes Hence, if a person supplies goods/services which are not liable to GST then, that place does not require separate registration though value will be added for aggregate turnover calculation
  • The following table summarises the threshold limit state- wise:
Sr No Threshold Limit States
(a) Rs 10 lakhs for goods/services/both Manipur, Mizoram, Nagaland and Tripura
(b) Rs 20 lakhs for goods/services/both Arunachal Pradesh, Meghalaya, Sikkim, Uttarakhand, Puducherry and Telangana
(c) Rs 40 lakhs for exclusive supply of goods and Rs 20 lakhs for services or both Jammu & Kashmir, Assam, Himachal Pradesh and all other states
  • If a person has even one branch in special category state mentioned in point (a) and (b) of point 2 from where he makes taxable supply then threshold for PAN India basis will be Rs 10 lakhs or Rs 20 lakhs respectively
  • A unit in SEZ needs to obtain separate registration even if it is in the same state as all supply made to and from SEZ unit will be treated as zero rated supply

Section 24: Compulsory Registration in certain cases

It is mandatory for the following persons to get themselves registered under GST irrespective of their aggregate turnover:

  • Person making interstate taxable supply
  • Casual taxable person
  • Non-resident taxable person
  • Recipient under reverse charge
  • Person required to deduct tax u/s 51
  • Agent making taxable supply on behalf of principal
  • Input service distributor
  • Every e-commerce operator required to collect tax u/s 52
  • Person required to pay tax u/s 9(5)
  • Person who makes supply other than 9(5) through an e- commerce operator
  • Any other person notified by Government
  • Person supplying online information and database access or retrieval services from outside India to un-registered person in India

 Important Notes:

  • Person making inter-state supply of taxable services and having aggregate turnover not exceeding Rs 20 lakhs (Rs 10 lakhs for special category states except J&K) are exempted from obtaining registration
  • Casual taxable person means “a person who occasionally supplies goods/services/both in the course of furtherance of business whether as principal, agent or in any other capacity in a state where he has no fixed place of business”
  • Casual taxable person making supplies of specified handicraft goods are entitled to threshold limit exemption of Rs 20 lakhs. For specified handicraft goods (Refer Notification No 33/2017-Central Tax dated 09.2017 and Notification 38/2017-Central Tax dated 13.10.2017)
  • Non-resident taxable person means “a person who occasionally supplies goods/services/both whether as principal, agent or in any other capacity but he has no fixed place of business or residence in India“. Thus, even if non-resident taxable person makes supply for personal purpose he is liable to register
  • Input service distributor means “an office of supplier of goods/services which receives tax invoices on receipt of input services and issues tax invoices for the purpose of distributing the credit to branches under same PAN” Thus, only credit on ‘input services’ can be distributed and not on input goods or capital goods
  • E-commerce operator means “any person who owns, operates or manages digital or electronic platform for business”
  • Input service distributor and person liable to deduct TDS u/s 51 are liable to register whether or not separately registered under this Act
  • Person who makes supply of services other than those specified u/s 9(5) through such e-commerce operator (required to collect tax u/s 52) are entitled to avail the threshold exemption of Rs 20 lakhs. Specified services u/s 9(5) are as under:
  Description of Service  Supplier   
 escription of  
Person Liable
  to pay GST
1)         Transportation of passengers by radio- taxi, motor-cab, maxi- cab and motorcycle
Any person    
E-Commerce
 Operator
                                   
2)         Providing accommodation in hotels, inns, guests houses, clubs, campsites or other commercial places meant for residential or lodging purpose
 
Any person except who is liable to register u/s 22(1) of the CGST Act (threshold)
E-Commerce
 Operator
3)         Services by way of house-keeping, such as plumbing, carpentering etc
Any person except who is liable to register u/s 22(1) of the CGST Act (threshold)
E-Commerce
 Operator

The following persons shall not be liable to registration:

  • Person engaged exclusively in supplying goods/services/both which are not liable to tax or are wholly exempted
  • Agriculturist to the extent of supply of produce out of cultivation of land
  • Specified category of persons notified by the Government

Important Notes

  • Agriculturist means “Individual/HUF who undertakes cultivation of land himself or by family or by servants on wages under personal or family supervision”
  • Specified category of persons notified by the Government:
    • Person engaged in supply of taxable goods/services/both on which tax liability is on recipient under reverse charge mechanism
    • Job workers other than those who are engaged in making inter-state supply of services r.t goods mentioned in Rule 138 of CGST Rules (jewelry, goldsmiths, silversmiths and other articles)

 Other Important Points:

  • Any person who is not liable to get himself registered u/s 22 or 24 can take  voluntary registration. In that case, all the provisions of this Act as applicable to a registered person shall This is beneficial to enhance B2B business and claim ITC paid on goods/services/both. The drawback includes more compliance and tax payment even though turnover is below the threshold limit
  • Registration number in GST is PAN based and hence having PAN is a pre requisite for obtaining registration. Non- resident taxable person can be granted registration on the basis of self attested Passport and signed application from authorized signatory in India
  • Some notified agencies of United Nations, multinational financial institutions and other foreign embassies as notified are issued a centralized unique identification number (UIN) instead of GSTIN to reduce compliances and make it easier for them to claim refund of taxes paid on input supplies
  • Where pursuant to search, enquiry, survey, inspection or any other proceeding, the proper officer finds that a person liable to register has failed to register then he can suo moto grant registration on temporary basis
  • A taxable person means “a person who is registered or is liable to be registered u/s 22 or 24 of CGST Act”. This implies that even an unregistered person who is liable for registration is a taxable person and a person not liable to be registered but has taken voluntary registration is also a taxable person

 Timeline for Registration

 

Type of Person

Person liable to register

Casual taxable Person/N on- resident taxable person

Days in which he should apply

Within 30 days of becoming liable

5 days prior to commencement of business

Effective date of registration

Date on which he becomes liable

Date of grant of registration

Remarks
If application not made within 30 days then from date of grant of registration

Temporary registration is granted on advance payment of tax on estimated basis at the time of application

Important Notes:

 

  • For transferee of a business as going concern on account of succession or any other reason, the liability to register arises on the date of transfer
  • For transferee of a business as going concern on account of scheme of amalgamation/demerger, the liability to register arises on the date on which the Registrar of Companies issues the Certificate of Incorporation

Penalty for non-registration

  • Penalty is 100% of the tax due or Rs. 10,000 – whichever is higher

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