Recognized as a remarkable moment in Indian tax reforms, the goods and services tax (GST) signified a paradigm shift in the indirect taxation system. GST put all indirect taxes in India under one single roof and made it exceptionally easy for anyone to understand the taxation system.
Ever since its inception, the GST council has worked consistently towards improving the experience for businesses and individuals. The GST rates are regularly updated, and the council helps eliminate any major concerns with the system.
GST offers many benefits to businesses and is one of the most important aspects of the current landscape. GST registration is one aspect that plays a crucial role for businesses to avail of the benefits that GST offers. This article gives you a detailed insight into what GST is and the GST registration process.
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What is GST?
The Goods and Services Tax is an indirect tax introduced to replace a plethora of other indirect taxes such as service tax, excise duty, purchase tax, VAT, etc. It is applicable all over India on specific goods and services that are sold for consumption within domestic boundaries
The Different Types of GST
GST is divided into four major categories:
- Central Goods and Services Tax (CGST): Governed by the central government, this type of GST applies to every intrastate transaction and is governed by the CGST Act. The revenue generated through CGST is collected solely by the central government.
- State Goods and Services Tax (SGST): Controlled by the SGST Act, this type of GST applies to transactions in the same state. The state government collects the revenue generated from this tax.
- Union Territory Goods and Services Tax (UTGST): This includes the transactions that occur in the union territories of India like Chandigarh, Daman and Diu, Andaman and Nicobar Islands, Lakshadweep Islands
- Integrated Goods and Services Tax (IGST): Controlled by the IGST Act, this type of tax is levied on interstate transactions. The tax collecting body for IGST is the central government. Once the tax money is collected, it is further divided among the states
GST Registration: Who is it for?
The Goods and Services Tax Act 2017 necessitates any enterprise with a business turnover of over Rs. Forty lakhs to register for GST. The turnover threshold is different for hill and north-eastern states at Rs 10 lakhs.
The GST Rate Structure
- 5% – Includes all household necessities such as lifesaving drugs, spices, sugar, tea, coffee, and sweets.
- 12% – Includes computers and processed food
- 18% – Includes industrial intermediaries, hair oil, capital goods, soap, and toothpaste
- 28%: Air conditioners, motorcycles, cars, aerated drinks, cigarettes, refrigerators.
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GST Registration: A Detailed Insight
The registration process is paperless and can be completed on the official portal. Here is how you can complete your business’s GST registration online:
- Visit the official portal, click on services, registration, and select new registration
- Start Part-A of the registration by selecting yourself as a ‘taxpayer’ and inputting the state and district from the drop-down menu
- Type the name of your business and enter the business PAN details
- Enter your email address and mobile number. The number you enter here will receive all the OTPs
- As soon as you hit proceed, you will receive the OTPs on your email and mobile number. You can enter the one-time password or click on RESEND OTP to get it again
- You’ll get the 15-digit temporary reference number (TRN). You will need this to complete Part B of the registration in the next 15 days.
- Visit the portal once more and click on ‘new registration.’
- Click on Temporary Reference Number and enter the TRN along with the captcha code to proceed
- Input the one-time password that you receive on your registered phone number and email address
- You will see the status of your application as ‘drafts’. Click on the edit icon.
- The Part B of the registration would require you to submit all the required documents and required information in 10 different sections
- Once you complete Part-B, you will be notified of a successful application, and an Application Reference Number (ARN) is sent to your registered email address and mobile number
- GST will apply to your business once all data is authorized
Expedite Your Operations with GST Registration
GST registration is one of the foremost ways to avail of several government schemes and get legally known as a supplier or a good or a service. We hope this article helped you get a fair idea about what GST is, who needs to register for it and the GST registration process. If you wish to know more about GST and other financial instruments, visit Investment Simplified. Get through the seamless online GST registration process and ensure the smooth sailing of your business operations.