State Goods & Service Tax (SGST)


The SGST rules have been amended to ensure more benefits to the businesses! Get the SGST registration done & enjoy all the incentives provided by the State Government. Stay on the right side of compliance & have absolute peace of mind!

Get Started!
Select State*
Select Language*
Get easy updates throughWhatsapp

Easy monthly EMI options available

No Spam. No Sharing. 100% Confidentiality.

noimage400,000 +

Business Served

noimage4.3/5

Google Ratings

noimageEMI

Easy EMI Options

How does GST registration work for you?

Any business offering sale of goods with annual turn over of 40 lacs or service with annual
turn over of 20 lacs would require the registration for GST and have a valid GST Number.

noimage

We help you get a Secure GSTIdentification Number.

Step 1

noimage
noimage

We make it easy for you to get your GSTfrom the comfort of your own home.

Step 2

noimage
noimage

We will file your returns and complete all othercompliances as and when required.

Step 3

State Goods & Service Tax (SGST)

State Goods and Service Tax or SGST refers to the tax levied by the state government on the transaction of goods and services. The tax that is collected under the head SGST will be payable to the state. Hence, SGST is levied on the intrastate supplies of both the services and goods. It is responsible for the state government and will be governed by the SGST Act. In SGST, the taxes like VAT, state sales tax, entertainment tax that unless or until it is levied by the local bodies, gambling, and betting, lottery tax, and surcharges are connected and related to the supply of goods and services that are included in the SGST.

Benefits of SGST

Elimination of multiple taxes

Elimination of multiple indirect taxes is one of the benefits of CGST. All taxes that are levied will not be in the line, i.e prevailing taxes like sales tax, turnover tax, service tax, etc, will come under a general tax called GST (Good and Service Tax).

Saves money

GST helps the common man save more money and reduce the price of goods and services. So, it is expected that the price of fast-moving consumer goods products, cinema tickets, small tickets, electrical products, etc will be reduced.

Ease of business

GST brings together the tax concept for the whole country, and no separate concept is followed for states. So, this concept has the same format among all other states and is highly beneficial for interstate business.

Best in filing tax and documentation

GST is highly beneficial for businessmen. So, tax filing, compliance, and documentation tasks are very easy for business professionals. Additionally, return filing, tax payment, and refund process will be easy and trouble-free.

Reduction of cascading effect

GST is applicable for all stages of business from manufacturing to consumption. Further, it provides tax credit benefits at every stage. In GST, you will have tax credit advantage and tax will be handled on margin price only. Therefore, it decreases the cascading effect of tax thereby decreasing the cost of goods.

More employment

It is expected that the demands of products will increase along with supply, as GST will reduce the cost of the product.

Checklist requirements for SGST Registration

  • All the suppliers who manage their own business across India will need new GST registration.
  • GST Registration must be for all the companies, small startups, industries who make a value over the designated turnover limit in India.
  • They should register under the GST Act to support single tax return rules.
  • Accurate Permanent Account Number(PAN).
  • Valid Indian mobile phone number.
  • Valid email address
  • Prescribed documents and data on all necessary fields of the registration application.
  • Place of business.
  • An approved signatory who is the citizen of India with real details, including PAN.
  • At least one proprietor/ director/ trustee/ karta/ member with a corresponding PAN card.
  • Indian Financial System Code (IFSC) number of the same bank and branch.
  • Correct India bank account number.
  • Jurisdiction details.

Features of SGST Act

  • SGST levy tax on all intra-state supplies of goods and services
  • To expand the base of the input tax credit by making them available in taxes paid on the supply of goods or services
  • It provides self-assessment for taxes that are payable by the registered person
  • Moreover, it conducts audits for the registered person to verify compliance with the provisions of the Act
  • The SGST Act recovers various tax arrears by using various modes that includes detaining and sale of goods, immovable and movable property of defaulting taxable person
  • The SGST grants the power of inspection and provides sudden changes
  • Additionally, it makes provision for fines or penalties of the contravention of the proposed legislation
  • Further, it provides the benefits of reduced tax incidence on goods and services or both the consumers
  • It gives a detailed description of transitional provisions of the taxpayers to the goods and services tax regime

What is the SGST Act or the State GST Act

The State Goods and Services Act was enacted for levy and tax collection on the intra-state supply of goods and services. Hence, it is governed by the state government. The state GST Act is applicable all over India including the states of Jammu and Kashmir. Jammu and Kashmir will approve the levy of GST in its State assembly. This is done with the special powers under the constitution. If this is completed, GST will be introduced in that particular state.

The SGST Act can only start from a date that will be notified by the state government in the official gazette, which is from the fixed date. It is noted that different provisions apply to different states that are to be notified.

The objective of the State GST Act

Under former taxation laws, the state government levied taxes on the manufacture of goods in the form of central excise duty, interstate sale of goods in the form of central sales tax, certain services that provide in the form of service tax.

Likewise, the state government levy tax on retail in the form of value-added tax, purchase tax, luxury tax, and entry of goods in the state. Moreover, there are multiple types of taxes that are levied on the same supply chain.

SGST Rules

Under GST management, taxes are levied on all-time sales. For intrastate deals, both central Goods and Service and state Goods and services will be levied. Inter-state sales are liable to integrated GST. There are many sections and scheduled rules and regulations of SGST. The common rules to be maintained in SGST are as follows:

  • If you are under GST registration, issue a tax invoice to all the taxable goods and services.
  • Likewise, if the registration is under composition scheme, issue a bill of supply.
  • Ensure that you make a note of all the invoices in sequential order.
  • Additionally, make sure that your GST invoices have your name, address, GSTIN, and supply place.
  • The rule states that it has identical state purchases. That is, SGST and SGST are equally filed. For instance, the GST rate is 18%, then Central GST is 9% and the State GST is 9%.
  • Furthermore, for any sale that is out of state business, IGST has to be charged.
  • Keep records of every document you get and create. And, make sure that the details are correct.
  • Do not buy any products from the dealers that are unregistered.
  • Ensure that you are filing GST correctly for the same and different states.
  • Do not forget to add a unique serial number for each and every invoice.
  • A tax invoice should be issued on the sale of chargeable goods and services. In case your invoice is already given, do not cancel them. Instead, just issue a credit note.
  • It would be much better if you take a tax invoice on all purchases of goods. The products must not be shipped without the original invoice.
  • Ensure that your documents have GSTIN and the client’s GSTIN is applicable.
  • Therefore, submit all your invoices and GST reports on time to get rid of any penalties.

History of SGST

State GST is one of the 3 classifications under the Goods and Service Tax such as IGST, CGST, and SGST. It has the concept of one tax one nation. SGST comes under State Goods and Service Tax Act 2016.

SGST charges on the movement of goods and services of standard products and services that can be improved from time to time by a separate body. The revenue collected supporting SGST is for the state. However, input tax credit on SGST is to states, and such input tax could be appropriated only against the payment of State GST.

Is CGST similar to an SGST?

No, there are some differences between the central GST and State GST. The only difference is the taxes are levied on the bases of state and central government. The differences are as follows:

ParameterSGSTCGST
Standard formState Goods and Service TaxCentral Goods and Service Tax
Taxes that are includedIn SGST, the taxes like VAT, state sales tax, entertainment tax that unless or until it is levied by the local bodies, gambling, and betting, lottery tax, and surcharges are connected and related to the supply of goods and services that are included.Under former taxation laws, the central government levied taxes on the manufacture of goods in the form of central excise duty, interstate sale of goods in the form of central sales tax, certain services that provide in the form of service tax.
Share of tax revenueIt is done based on the state government’s decisionIt is done based on the central government’s decision
Mechanism of usage of creditsA merchant or seller can use input tax credit against SGST against SGST or IGST. The credit of SGST cannot be applied against CGST.A merchant or seller can use input tax credit against CGST against CGST or IGST. The credit of CGST cannot be applied against SGST.

What are the steps involved in GST registration through Vakilsearch?

  • Step 1: We help you get a Secure GST Identification Number.
  • Step 2: We make it easy for you to get your GST from the comfort of your own home.
  • Step 3: We will file your returns and complete all other compliances as and when required.

Documents based on which the tax credit is availed

Major documents required for SGST are PAN card, business registration proof, Identification cards, passport size photos, address proof of the individual, business address proof, and bank account records. Your bank statement can be used for verification. Further, verification includes the cancelled cheque or an extract from your passbook. Additionally, through address verification, electricity bill, rent agreement, purchase documents, property tax statement, etc can be verified.

For People and Sole Proprietors

  • Owner’s PAN card
  • Owner’s Aadhaar card
  • Owner’s photograph
  • Proof of address
  • Bank account details

For Partnerships and LLPs

  • Partnership deed
  • PAN cards of partners involved
  • Photographs of partners involved
  • Address proof of partners involved
  • Aadhaar card of any authorized signatory
  • Signatory’s proof of appointment
  • LLP proof of registration
  • Bank details
  • Business’ principal address proof

For HUFs (Hindu Undivided Families)

  • HUF’s PAN card
  • (Patriarch of the family) PAN card
  • Photos of owners
  • Account details of the bank
  • Address proof of the business

For Company

  • PAN Card of the company
  • Business certificate of the Ministry of Corporate Affairs
  • Record/ Reports of Association
  • Appointment record of the signatory
  • PAN Card of the signatory
  • Aadhaar card
  • PAN card of all executives
  • Residence proof of all executives
  • Account details of the bank
  • Address proof of the business

Society or Club

A society or club wants to give the following GST filing documents to make the process and obtain GSTIN.

  • Club or society’s registration certificate copy.
  • PAN card copy of the club or society with that of affiliated associates or promoters.
  • Photograph of co-workers or promoters.
  • Bank account copy - record/crossed cheque/passbook’s first page.
  • Confirmation of certified office’s location, that can include utility bills, certificates of legal ownership/municipal khata model for bases owned by the organization or society.
  • Permission letter approved by approved signatory/signatories.

Why Vakilsearch:

Vakilsearch is India’s largest professional platform of lawyers, chartered accountants, and company secretaries-with years of experience behind. We execute legal work for over 1000 companies and LLPs every month, by leveraging our tech capabilities, and the expertise of our team of legal professionals.

9.1 Customer Score

  • We make your interaction with the government as smooth as possible by doing all the paperwork for you. We will also give you absolute clarity on the process to set realistic expectations.

300-Strong Team

With a team of over 300 experienced business advisors and legal professionals, you are just a phone call away from the best in legal services.

Access To Experts

We provide access to reliable professionals and coordinate with them to fulfil all your legal requirements. You can also track the progress on our online platform, at all times.

Realistic Expectations

By handling all the paperwork, we ensure a seamless interactive process with the government. We provide clarity on the incorporation process to set realistic expectations.

Get me more details
Select State*
Select Language*

Easy monthly EMI options available

No Spam. No Sharing. 100% Confidentiality.