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GST Business Registration: The Complete Guide

If you are running a business whose annual turnover exceeds the GST threshold limit, you are required to mandatorily undergo GST registration for your business, unless you are explicitly exempt from doing so. Keep reading to know more.

Registration is the most basic requirement in every tax system for identifying taxpayers and ensuring that tax is being paid by the citizen’s liable to pay the same. Registration of any business entity under the GST Law entails obtaining a unique number (GSTIN) from the relevant tax authorities for the purpose of collecting tax on behalf of the government and claiming input tax credit (ITC) for taxes paid on inward supplies.

A person cannot collect tax from his customers or receive an input tax credit for tax paid by him unless he is registered under the GST regime.

GST Business Registration Threshold

Upon addressing the demands of MSME, the GST Council revised the threshold restrictions for GST Registration. These modifications were recommended in the 32nd GST Council meeting held on 10th January 2019. The CBIC was subsequently notified of the following –

  • Any business engaged in the supply of goods whose turnover in a fiscal year exceeds 40 lakhs for states in the normal category that have opted for the new threshold (20 lakhs for special category states and those in states that have not opted for the new threshold, such as Telangana) must register for GST.
  • Any business engaged in the rendering of services or mixed supplies of goods & services whose turnover in a fiscal year exceeds 20 lakhs in normal category states (10 lakhs for special category states) must register for GST.
The aggregate turnover includes supplies made on behalf of a business vertical’s employees but excludes the value of those products where the owner himself is a job worker to that extent.

GST Registration for Proprietorship

Entrepreneurs need to stay on top of developments in the business sector and make sure that all pertinent laws are being followed. Important owner requirements include registration for the Goods and Services Tax (GST). Owners can verify their validity by registering for GST, and they can also take advantage of a number of tax-related benefits. This in-depth tutorial will explain the intricate details of GST registration for sole proprietorship enterprises in India and list the necessary paperwork.

When to get GST Registration for Proprietorship Firm?

  • When a proprietorship’s annual revenue hits 40 lakh rupees: The proprietorship firm must register for GST if its yearly turnover exceeds the threshold amount of 40 lakhs rupees (or 20 lakh rupees for some states that fall under a specific category).
  • When a sole proprietorship business transacts business across state lines: Regardless of turnover, GST registration is required if a proprietorship business engages in interstate sales, which are sales of goods or services from one state to another.
  • When a sole proprietorship business engages in online sales: No matter the turnover, it must register for GST if it engages in e-commerce.
  • When a single-person business wants to submit an input tax credit claim: GST registration is required in order to take advantage of the input tax credit, which enables businesses to claim a credit for the GST paid on purchases.
  • Voluntarily: Even if the aforementioned requirements are not completed, a sole proprietorship business can choose to register for GST. This can be advantageous if the company wishes to grow, build credibility, or work with other businesses that need GST registration.

Is It Mandatory to Have a GST License for a Sole Proprietor Firm?

In India, a sole proprietorship is not required to have a GST (Goods and Services Tax) licence unless a number of requirements are satisfied. The amount of revenue and the type of business operations determine whether GST registration is necessary.

As previously stated, GST registration is required if the sole proprietorship’s yearly revenue exceeds the permitted threshold, currently set at 40 lakh rupees (or 20 lakh rupees for states that fall under a specific category).

If a sole proprietorship engages in interstate sales, online commerce, or plans to claim the input tax credit, GST registration is required.

The sole proprietorship, however, has the option to voluntarily register for GST even if its revenue and operations do not match the requirements. Expanding the scope of voluntary registration can be beneficial.

 What Are the Benefits of GST Registration for Private Limited Company?

The advantages of GST registration are listed below:

  •  Making Tax Services Simple
  •  The price of products and services has dropped.
  •  By employing this aid, avoids using long tax services.
  •  Minimises theft and transactions without receipts.

 Steps to Register GST for Private Limited Company

Companies, Firms, or Individuals must register under the Goods and Services Tax (GST) through the GST Registration application process in order to benefit from input tax credit advantages.

Online registration for GST can be finished, and a Temporary Reference Number (TRN) is generated for the application, on the Goods and Services Tax website,

  • Become a member of the GST Online Portal.
  • Complete the application.
  • Your information is verified by the portal through email or OTP.
  • the necessary paperwork online
  • You will receive a reference number for your application.
  • Wait for the approval, or reapply if you receive a rejection letter. Any additional supporting information or justifications must be provided.
  • Upon resolution of all issues, you will be given a GSTN number and GST

Two Important Advantages of GST Business Registration

  • GST has eliminated the cascading effect of ‘tax on tax’ on the sale of goods and services and has thereby reduced the intrinsic cost of items.
  • GST has transformed the indirect taxation regime into a technologically driven wonder whereas everything from registration, return filings, refund applications, and notice responses can be completed online.

How Vakilsearch Can Assist in Obtaining GST Business Registration?

Don’t think you can undergo the rigmarole of GST’s indirect taxation formalities? Apply for GST in 5 simple stages, as handled by Vakilsearch’s GST professionals:

  • As a first and foremost step, you must get in touch with Vakilsearch ‘s GST specialists to assess your GST needs and requirements 
  • Our team of professional GST specialist’s will then ensure that all your paperwork and documentation is in order, so as to facilitate hassle-free GST enrollment.
  • Our skilled legal team will then guide you through the GST registration: process and complete the entire process on your behalf so that you can acquire your ARN and GSTIN as soon as possible. 
  • The Vakilsearch team will also help manage any difficulties in terms of compliance and physical verification that may occur during the registration process.
  • In fact, our professionals can even help you out post-registration by handling all of your return filings to keep you GST compliant.

Get in touch with us today to join our network of exclusive corporate clientele!


Is GST required for small businesses?

Yes, all small firms register for GST since the GST Act requires them to do so. If you are a maker of goods with an annual turnover of more than 40 Lakhs, you should definitely think about getting a GST for small businesses.

Which business is GST-free?

Agricultural services are generally exempt from the GST and include harvesting, packaging, storage, cultivation, supply, and leasing of machinery. The rearing of horses is an exception to these exempt services. Public transit options include metro, metered cabs, auto rickshaws and more.

Is GST required below 20 lakhs?

To be more precise, the GST regime's registration requirements do not apply to suppliers or dealers of commodities with a yearly turnover of up to 20 lakhs.

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