Introduction

SECTION : Registration

DESCRIPTION
  • Lesson Objectives


    On completion of this lesson, you will be able to understand:

    ·        Section 22 – Persons liable for Registration

    ·        Section 23 – Persons not liable for Registration

    ·        Section 24 – Compulsory Registration in certain cases

     

     Please go through the First Video of the Chapter 3.

    Registration - Introduction

     Registration

    Registration of a Business with the Tax Authorities implies obtaining a unique identification code (i.e. GSTIN) from the concerned tax authorities so that all the operations of and data relating to the business can be agglomerated and correlated.

     

    In any tax system, this is the most fundamental requirement for identification of the business for tax purposes and for having any compliance verification system.

     

    Every Supplier shall be liable to be registered under the Act in the State from which he makes a taxable supply of goods or services or both.

     

    Registration - State

    It is important to identify the ‘origin’ of supply even though GST is a ‘destination’ based tax. Tax goes to the destination state but registration is in the original state.

    ·        Registration is required ‘in’ the state ‘from which’ taxable supplies are made.

    ·        Registration is not required ‘in’ the state ‘to which’ taxable supplies are made.

     

    Registration Process

    Registration Process in GST include

    1.      Furnish / File necessary forms, documents etc.

    2.      Sign with Digital Signature / E-signature.

    3.      Approval from the Govt. / Tax Department.

    4.      Person will be recognized as legally registered Taxable Person

     

    Advantages of taking registration in GST

    Registration under Goods and Service Tax (GST) regime will confer following advantages to the business:

    1.      Legally recognized as supplier of goods or services.

    2.      Proper accounting of taxes paid on the input goods or services which can be utilized for payment of GST due on supply of goods or services or both by the business.

    3.      Legally authorized to collect tax from his purchasers and pass on the credit of the taxes paid on the goods or services supplied to purchasers or recipients.

    4.      A person without GST registration can neither collect GST from his customers nor claim any input tax credit of GST paid by him.

     

    GST will be applicable in Jammu & Kashmir only after the state assembly passes a special law accepting the applicability of CGST & IGST law.

     

    Persons liable to take registration

    The persons are classified into the following categories for Registration.

        

        1.General / Normal Category:-Who has to take registration based on Aggregate Turnover. They need to register only when the Total Turnover for the Financial Year exceeds the Threshold Limits.

    2.      2.Mandatory Category:-Who has to compulsorily take registration irrespective of the Turnover. Threshold Limits are not applicable to them.

    3.    3.  Exempted Persons:-Those who need not take registration. But they can take voluntary registration if needed.

    4.     4. Transitional Registration:-All Taxable Persons who have registered under the existing laws should be registered under the GST Act through Enrolment process.

     

     

    a)    General / Normal Category

    Tax is payable by the taxable person on the supply of goods and/or services. Registration required when the Aggregate Turnover crosses the Threshold Exemption.

     

    SI No.

    Category

    Threshold Exemption

    1

    Normal States

    20 Lakhs

    2

    Special Category States

    10 Lakhs

     

    Special Category States include Arunachal Pradesh, Sikkim, Uttarakhand, Himachal Pradesh, Assam and the other States of the North-East.

     

    Aggregate Turnover

    Aggregate turnover shall include the aggregate value of all taxable supplies, exempt supplies, Inter-state Supplies and Exports of goods and/or services.

    ·        Aggregate turnover shall be computed for PAN on all India basis.

    ·        Aggregate turnover does not include value of supplies on which tax is levied on reverse charge basis and value of inward supplies.

    ·        Non-taxable supplies should be included.

    ·        The above shall be computed on all India basis and excludes taxes charged under the CGST Act, SGST Act and the IGST Act.

     

    b)    Mandatory Category

    The following categories of persons shall be required to be registered compulsorily irrespective of the threshold limit:

      Persons making any inter-State taxable supply;

      Casual Taxable Persons and Non-resident taxable persons

      Persons who are required to pay tax under reverse charge mechanism;

      Electronic Commerce Operator.

      Persons who are required to deduct tax at source.

      Suppliers providing goods / services through an E-Commerce Operator.

      Persons who are required to collect tax at source.

      Agents providing goods and/or services on behalf of other registered taxable persons called as Principals.

      Input Service Distributor.

      Persons supplying online information and database access or retrieval services from a place outside India to a person in India.

      Such other person or class of persons as may be notified by the Central Government or a State Government on the recommendations of the Council.

    Threshold Exemption is not applicable to such persons.

     

     

    3. Exempted Category

    Persons who supply non-taxable goods / exempted goods like an Agriculturist are exempted from registration under the GST law.

     

    As per Section 2(7), Agriculturist means an individual or HUF who undertakes cultivation of land:

    a)     By own labour or

    b)    By the labour of family, or

    c)     By servants on wages payable in cash or kind or by hired labour under personal supervision of any member of the family

     

    Thus an agriculturist is not liable for registration only to the extent of supply of produce out of cultivation of land. If an Agriculturist undertakes supplies which are not linked to the cultivation of land, he will fall within the provisions of section 22 and may have to take registration in respect of such supplies. For example, harvesting paddy is cultivation but production of rice is not.

     

    Apart from Agriculturists, persons engaged exclusively in the supply of exempted goods or services or both are the ones not liable to obtain registration.

     

    If the Supplier is supplying both exempted and non-exempted goods and/or services, then he is required to obtain registration.

     

    Central Government or a State Government on the recommendations of the Council can notify such other person or class of persons as exempted from GST. In this regard, the Government has exempted the following persons from obtaining registration.

    a)     Job-workers engaged in making inter-state supply of services to a registered person subject to conditions.

    b)    Persons effecting inter-state taxable supplies of handicraft goods – where the aggregate value of supplies on PAN-India basis does not exceed 20 Lakh in a year (10 Lakh for Special Category states).

    c)     Persons effecting inter-state supplies of taxable services – where the aggregate value of supplies on PAN-India basis does not exceed 20 Lakh in a year (10 Lakh for Special Category states).

    d)    Persons providing services through an e-commerce platform, provided their aggregate value of supplies on PAN-India basis does not exceed 20 Lakh in a year (10 Lakh for Special Category states except J&K.) and the supplier is not liable to collect tax at source under GST.

     

    4. Transitional Category

    The existing registrants / Taxable Persons who have registered under the existing laws such as i.e. Central Excise Law, State VAT Laws, Service Tax etc. will be migrated to GST Law through an enrolment process.

     

    Time limit for taking a Registration

    Any person should take a Registration, within thirty days from the date on which he becomes liable to registration, in such manner and subject to such conditions as may be prescribed.

     

    Effective date of registration

    Where the application for registration has been submitted within thirty days from the date on which the person becomes liable to registration, the effective date of registration shall be date of his liability for registration.

     

    Where an application for registration has been submitted by the applicant after thirty days from the date of his becoming liable to registration, the effective date of registration shall be the date of grant of registration. In case of suomoto registration, i.e. taking registration voluntarily while being within the threshold exemption limit for paying tax, the effective date of registration shall be the date of order of registration.

     

     

     

    Sl No.

     

    Application Filed

     

      Effective Date of Registration

     

    1

    Within 30 days from the date of liable to register

    The Date of Liability for Registration

    2

    After 30 days from the date of liable to register

    The Date of Grant of Registration

    3

    Voluntary Registration (Under the Threshold Limit etc.)

    Date of Order of the Registration


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