What is GST?
The Goods and Services Tax (GST) is a comprehensive value-added tax imposed on the sale of goods and services within a country for domestic consumption. GST serves as a unified and singular indirect tax regulation that applies nationwide.
GST is integrated into the ultimate cost of a product, so when a customer purchases the product, they pay a price that already includes the GST. Subsequently, the business or seller transfers the GST portion to the government.
The Central Government of India levies this tax. In cases of intrastate transactions, the GST revenue is divided between the central and state governments, with CGST and SGST mechanisms in place.
What is GSTIN?
GSTIN or Goods and Services Tax Identification Number (GSTIN) is provided to entities having GST registration number. GSTIN is 15 characters in length. The allocation of GSTIN is based on PAN and State of the applicant. In a GST registration number, the first two digits represent the State Code. The following next 10 digits represent the PAN of the applicant.
Objective of GST
- The eradication of diverse tax systems
- Enhancement of business tax compliance
- Lowering the cost
- Enhancement of operational efficiency
- Increase the nation's overall revenue.
Taxable person under GST
A “taxable person” as defined in the GST Act pertains to any entity or individual engaged in business activities in India, and either holds registration under the GST Act or is required to register. This category encompasses a diverse range of entities, including individuals, Hindu Undivided Families (HUFs), companies, partnerships, Limited Liability Partnerships (LLPs), Associations of Persons (AOPs), Body of Individuals (BOIs), corporations, government-owned companies, foreign corporate bodies, cooperative societies, local governing bodies, government entities, trusts, and artificial juridical persons.
Documents Required for GST Registration
- PAN card of the owner
- Aadhar card of the owner
Photograph of the owner
Bank account details
- Address proof
- PAN card of all partners (including managing partner and authorized signatory)
- Copy of partnership deed
Photograph of all partners and authorised signatories
Address proof of partners (Passport, driving license, Voters identity card, Aadhar card etc.)
Aadhar card of authorised signatory
Proof of appointment of authorized signatory
In the case of LLP, registration certificate / Board resolution of LLP
Bank account details
- Address proof of principal place of business
- PAN card of HUF
PAN card and Aadhar card of Karta
Photograph of the owner
Bank account details
- Address proof of principal place of business
- PAN card of Company
Certificate of incorporation given by Ministry of Corporate Affairs
Memorandum of Association / Articles of Association
PAN card and Aadhar card of authorized signatory. The authorised signatory must be an Indian even in case of foreign companies/branch registration
PAN card and address proof of all directors of the Company
Photograph of all directors and authorised signatory
Board resolution appointing authorised signatory / Any other proof of appointment of authorised signatory
Bank account details
- Address proof of principal place of business
No, a person without GST registration can neither collect GST from his customers nor can claim any input tax credit of GST paid by him.
GST is not applicable to exports. However, imports are subject to IGST, which can be claimed as an input tax credit.
Some items and services are exempted from GST, such as certain agricultural products, healthcare services, and educational services. Additionally, certain small businesses may be eligible for the Composition Scheme.
Yes, online businesses and e-commerce platforms are also liable to pay GST on the supply of goods and services.
The time frame for approval can vary but is usually within 3-7 working days from the date of application.
After registration, you need to file regular GST returns, maintain proper records, and comply with other GST rules and regulations.
In India, there are four main GST rates: 5%, 12%, 18%, and 28%. There is also a 0% rate for essential goods and some exempted categories.
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