Every business conducting operations in India is obligated to undergo GST Registration, a mandatory requirement ensuring streamlined taxation and prevention of tax fraud. The Goods and Services Tax (GST) is a significant taxation reform in India, unifying various indirect taxes imposed by Central and State Governments. Section 68 of the IT Act necessitates GST Registration for businesses with an annual turnover of INR 20 lakhs or more. This article offers insights into the process and significance of GST Registration and outlines who should register for GST under Section 68.
Understanding GST and Its Registration
GST stands for Goods and Services Tax, a comprehensive tax reform that replaces prior indirect taxes. It’s a monumental change in India’s tax system, transforming the way businesses operate.
Eligibility for GST
Entities involved in selling goods or services within their state, with a turnover below INR 200,000, aren’t mandated to register for GST. Conversely, businesses engaged in cross-state transactions or inter-state supply services are required to comply with GST regulations.
Mandatory GST Registration
Various businesses including those dealing with custom clearance, inter-business transactions, or buying and selling goods to third-party customers must undergo GST Registration as per Section 68 of the IT Act.
The Process of GST Registration
GST registration is an online process involving six essential steps. Mistakes should be avoided to ensure eligibility. The GST registration number is usually sent to the registered mobile number or email ID. Access the GST registration link available on the Income-tax e-filing website to retrieve it.
Understanding GST Registration under Section 68
Businesses such as companies, partnerships, self-employed professionals like architects, engineers, lawyers, etc., need to register under Section 68 of the IT Act for GST.
Initial Steps for GST Registration under Section 68
Commence the registration process by registering your business and confirming your GST number. Subsequently, verify your details by filing GSTR-1.
Key Points about GST Registration under Section 68
Businesses must register under Section 68 to ensure compliance with the new GST laws and regulations. Registration needs to be completed before commencing GST-related activities.
Procedure for Registering under GST
Completing a registration form containing essential details, PAN and bank information, and describing your business’s goods and services is required. Timely registration is crucial to avoid penalties.
Input Tax Credit under GST
The Input Tax Credit (ITC) allows manufacturers to claim tax credit on raw materials and products. However, it isn’t applicable to e-commerce sales.
Conclusion
GST, as a new taxation system, simplifies tax processes for businesses in India. Understanding the GST registration process, eligibility criteria, and prerequisites for registration ensures businesses benefit from the GST regime in the long term.
