GST Registration FAQs

What is GSTIN?

All businesses that successfully register under GST are assigned a unique Goods and Services Tax Identification Number also know as GSTIN.

When should a business apply for multiple GST registrations?

If a business operates from more than one state, then a separate GST registration is required for each state. For instance, If a sweet vendor sells in Karnataka and Tamil Nadu, he has to apply for separate GST registration in Karnataka and TN respectively.

A business with multiple business verticals in a state may obtain a separate registration for each business vertical.

What is Composition scheme and when should a business opt for it?

Small businesses having an annual turnover less than Rs. 1 crore* ( Rs. 75 Lakhs for NE States) can opt for Composition scheme.*GST Council decided to increase the limit to Rs. 1.5 crores but notification is awaited.

Composition dealers will pay nominal tax rates based on the type of business:

·        Composition dealers are required to file only one quarterly return (instead of three monthly returns filed by normal taxpayers).

·        They cannot issue taxable invoices, i.e., collect tax from customers and are required to pay the tax out of their own pocket.

·        Businesses that have opted for Composition Scheme cannot claim any Input Tax Credit.

·        Composition scheme is not applicable to :

o    Service providers

o    Inter-state sellers

o    E-commerce sellers

o    Supplier of non-taxable goods

o    Manufacturer of Notified Goods

Who can Register for Composition scheme under GST?

This scheme is a lucrative option for all SMEs who want lower compliance and lower rates of taxes under GST.

A GST taxpayer whose turnover is below Rs 1 crore* can opt for Composition Scheme. In case of North-Eastern states and Himachal Pradesh, the present limit is Rs 75* lakh.

Turnover of all businesses registered with the same PAN should be taken into consideration to calculate turnover.

* Limit is raised to Rs. 1.5 crores after decision taken by the GST Council. However, notification is awaited. Learn the Rules about Composition scheme & Know the pros & cons of being a composition dealer.

Obtain GST registration and file CMP-02 to opt-in for the scheme.

What are the benefits of registering under GST?

A. For normal registered businesses:

o   Take input tax credit

o   Make interstate sales without restrictions

To know more about the Benefits of GST

B. For Composition dealers:

o   Limited compliance

o   Less tax liability

o   High working capital

To know more about composition scheme

C. For businesses that voluntarily opt-in for GST registration (Below Rs. 20 lakhs)

o    Take input tax credit

o    Make interstate sales without restrictions

o    Register on e-commerce websites

o    Have a competitive advantage compared to other businesses

To know more about voluntary registrations