Launched on July 1 2017, the Goods & Services Tax (GST) applies to all Indian service providers (including freelancers), traders and manufacturers. The GST is an all-in-one tax that subsumes a variety of state (VAT, Entertainment Tax, Luxury Tax, Octroi) and central taxes (CST, Service Tax, Excise Duty). GST is to be charged at every step of the supply chain, with full set-off benefits available. The procedure for GST is entirely online and requires no manual intervention.
GST is a comprehensive, multi-stage, destination-based tax that is levied on every value addition.
Every product goes through multiple stages along the supply chain, which includes the purchasing of raw materials, manufacturing, sale to the wholesaler, selling to the retailer and then the final sale to the consumer. GST will be levied on each of these stages (including value addition) and at the point of consumption, rather than the origin of the product. For example, if the product is produced in Tamil Nadu but consumed in Karnataka, then the entire tax revenue will go to Karnataka instead of Tamil Nadu. Also, taxpayers with a turnover of less than Rs.1.5 crore can opt for composition scheme to get rid of tedious GST formalities and pay GST at a fixed rate of turnover.
Who Should Register for GST?
- Businesses with turnover above the threshold limit of Rs. 40 Lakhs* (Rs. 10 Lakhs for North-Eastern States, J&K, Himachal Pradesh and Uttarakhand)
- Casual taxable person / Non-Resident taxable person
- Agents of a supplier & Input service distributor
- Those paying tax under the reverse charge mechanism
- Person who supplies via e-commerce aggregator
- Every 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
CBIC has notified the increase in threshold turnover from Rs 20 lakhs to Rs 40 lakhs. The notification will come into effect from 1st April 2019.
Penalty for not registering under GST
The penalty will at 100% of the tax amount due when the offender has deliberately evaded paying taxes.
Documents Required for GST Registration
PAN of the Applicant
Proof of business registration or Incorporation certificate
Identity and Address proof of Promoters/Director with Photographs
Address proof of the place of business
Bank Account statement/Cancelled cheque
Letter of Authorization/Board Resolution for Authorized Signatory
Mandatory documents for Online GST registration
The list of documents required for registration of GST for various business are as follows:
• PAN Card and address proof of proprietor
• PAN Card of LLP
• LLP Agreement
• Partners’ names and address proof
Private Limited Company
• Certificate of Incorporation
• PAN Card of Company
• Articles of Association, AOA
• Memorandum of Association, MOA
• Resolution signed by board members
• Identity and address proof of directors
• Digital Signature
The following can be shown as proof of address of a director:-
• Voter Identity Card
• Aadhar Card
• Ration Card
• Telephone or Electricity Bill
• Driving License
• Bank Account Statement
Add what works as identity proof, One can use a PAN Card, Aadhar Card as identity proof. For address proof, any of the director’s can show their voters ID, passport, telephone bill, electricity bill and telephone bill
Mandatory documents for Online GST registration
One of our GST representatives will collect all the required documents and process the GST application through the iCFO platform.
Once all the documents are collected, the application will be processed and filed. Then immediately the ARN number will be issued.
GST Registration Certificate
The GST registration certificate and GSTIN will be issued upon verification of GST application and other mandatory documents by the GST officer. Be aware that no hard copies of the certificate will be issued and the GST registration certificate can be downloaded from the GST Portal.
Penalties For Failure To GST Registration
As per the Section 122 of the CGST act, in India, there is a direct penalty for all those taxable persons who fail to register for GST.
Voluntary Registration Under GST (for Companies With A Turnover Below Rs.20 Lakhs)
Any small business with turnover less than 20 lakh can voluntarily register for GST even though it is not compulsory by law. Voluntary GST registration has its own advantages and some of them are:
• Take input credit: In GST, there is a flow of input credit right from manufacturers of the goods till the consumers, across the country. Input credit means a taxpayer while paying tax on output can deduct the tax that has already been paid on inputs and pay only the remaining amount. Voluntarily registered businesses can increase their margins and profits through this.
• Do inter-state selling with no restrictions: SMEs can increase the scope of their businesses and find prospective customers and explore online platforms
• Register on e-commerce websites: SMEs can widen their market by registering through e-commerce sites.
• Have a competitive advantage compared to other businesses
GST Return Filing
A GST Return Filing is a return document that contains details of the income of the taxpayer. It has to be filed with the GST administrative authority. The document is used tax authorities to calculate the tax liability of a GST taxpayer. A GST Return Filing form has to include the following details.
• Output GST (On sales)
• Input tax credit (GST paid on purchases)
For filing a GST Return, you need to have GST compliant sales and purchase invoices attached.
Email the required Documents to Info@ipexr.com