GST Registration Is Crucial To Your Business. Learn Why?

What is GST Registration?

Every business or corporation that is involved in the providing goods/services & has a turnover of above Rs.40 lakhs (Rs 10 lakhs for special category states present in hill states and North-Eastern states) to get registered as a normal taxable entity or regular taxpayer through online GST registration process.

Once You become eligible for registration under GST, you must apply for a unique GSTIN from the GST Portal. Online GST registration is required by every registered taxpayer in order to collect and pay GST on the outward supplies i.e. sales and for claiming ITC on the inward supplies i.e. purchases.

Process of applying for GST Registration

The following are the two ways to register for GST:

via GST Online Portal or

via GST Seva Kendra set up by Government of India

The process is usually completed within 4-6 working days and a registration certificate having a unique GSTIN which is a 15-digit alphanumeric code, is provided to the individual.

Importance of Online GST Registration

ITC Benefits

Only Registered persons can claim the Input tax credit on the purchase of goods & services & can utilize the same for payment of taxes due on supply of goods or services. Input tax credit lets you reduce your tax you have already paid on inputs and pay the remaining amount at the time of paying tax.

Customer Trust

Businesses with GST registration get recognition as a supplier of goods/services which in turn helps in attracting more customers and growing business. It shows that you are someone who can be trusted, hence there will be natural trustworthiness towards you from consumers and suppliers.

Lesser compliance

Under the previous tax regime, businesses had to file multiple returns accorded with different indirect taxes – VAT, excise, and service tax. As GST is a unified and singular tax regime, the number of filings has come down, making it less hassle for entities to file a return and thereby reducing the paperwork to a large extent

Unrestricted Inter-state movement

Registered persons can make Interstate sales without any restrictions. It widens the potential market for SMEs .

Legal Advantage

Registered people will be legally recognized as a supplier of goods or services. He would be legally authorized to collect tax from his customers and pass on the credit of the taxes paid on the goods or services supplied to the purchasers/ recipients. Aslo, if someone takes legal action against you, you will have legal strength to defend yourself. Without the GST registration, you cannot be considered as a genuine business, and it could work against you.

Common Tax Rates

GST rates and structures are common across the country. A uniform tax is levied all across the country on goods and services, which makes it much more convenient to understand the entire indirect tax structure and thereby increasing certainty and ease of doing business

Relief to Small Taxpayers

Small and medium taxpayers can avail the benefit of the composition scheme and lessen their  compliance burden and cost. Taxpayers may opt for this scheme if their annual turnover in the previous financial year is less than 1.5 Cr.

Avoid Unfavorable Consequences

If the authorities get to know that a business fulfilling the eligibility is carrying its operations without registering to GST, there could be major difficulties that could arise which include  penalties, creating a negative image on authorities about the trustworthiness of you and your business, attracting frequent checks, or any unwanted issues.

Other benefits

Registering on e-commerce sites or opening your own ecommerce website becomes easy which will widen the scope of business for a registered person. Getting online GST Registration also makes you eligible to avail various other benefits and privileges rendered under the GST laws.

Key Documents

The following documents must be kept handy while applying for online GST registration -

• PAN & Aadhar of the Applicant as Identity
• Proof of business registration/Incorporation certificate
• Identity and Address proof of Promoters/Director along with Photographs
• Address proof of business place
• Bank Account statement
• Digital Signature
• Letter of Authorization/Board Resolution for Authorized Signatory

Exemptions

The following people and entities are exempt from getting online GST registration:

• Businesses that manufacture supplies that come under reverse charge.
• Activities that do not come under the supply of goods or services. Examples of such activities are the sale of a building or land, funeral services, and services provided by an employee.
• Businesses that make non-GST/ non-taxable supplies. Examples are aviation turbine fuel, electricity, natural gas, high-speed diesel, and petrol.
• Businesses that make exempt/ nil-rated supplies.
• Businesses that fall under the threshold exemption limit.
• Agriculturalists.

Conclusion

GST is now paving the way for a common national market and Indian goods are also expected to be more competitive in international and domestic markets. Carrying the motive of “One Nation One Tax”, it has made the compliance procedure and tax administration more transparent, seamless, and intuitive and corruption-free. In a nutshell, it is always advised to not ignore online GST registration as it has far reaching benefits as discussed above.