What is GST?
The Goods and Services Tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the businesses selling the goods and services. In effect, GST provides revenue for the government. It incorporates all taxes such as Sales Tax, Service Tax, Excise Duty etc. into GST. Businesses registered under any of the pre-GST laws: VAT, Excise/Service Tax have to register under GST by default.
The registration in GST is PAN based and State specific.GST registration is required primarily if your annual sales turnover exceedsRs. 20 Lakh
. Even if your sales are less than Rs. 20 Lakh, we suggest that you voluntarily opt for GST registration.
Documents required for GST Registration
- PAN card of the Company
- Proof of constitution like partnership deed, Memorandum of Association (MOA) /Articles of Association (AOA), certificate of incorporation.
- Details and proof of place of business like rent agreement or electricity bill
- Cancelled cheque of your bank account showing name of account holder, MICR code, IFSC code and bank branch details
- Authorized signatory like List of partners with their identity and address proof in case of partnership firm or List of directors with their identity and address proof in case of company.
Businesses that needs GST registration
It is important to mention here that apart from the business whose turnover exceeds the threshold limit of Rs. 20 lakhs(Rs 10 lakhs for North Eastern and hill states), the following business will also have to register themselves under the GST:
- Every person who is registered under the Pre-GST law (i.e., Excise, VAT, Service Tax etc.) needs to register under GST.
- When a business which is registered has been transferred to someone, the transferee shall take registration with effect from the date of transfer.
- Casual taxable person
- Non-Resident taxable person
- Agents of a supplier
- Those paying tax under the reverse charge mechanism
- Input service distributor
- E-commerce operator or aggregator
- Person who supplies via e-commerce aggregator
- Person supplying online information and database access or retrieval services from a place outside India to a person in India, other than a registered taxable person
An offender not paying tax or making short payments (genuine errors) has to pay a penalty of 10% of the tax amount due subject to a minimum of Rs.10, 000.
The penalty will at 100% of the tax amount due when the offender has deliberately evaded paying taxes.