GST Registration Online: Meaning, Benefits, Eligibility and Documents

The Goods and Services Tax (GST) is a unified tax on the supply of goods and services. Earlier there were several indirect taxes. After July 2017, the Government of India brought all these taxes under one umbrella- GST. Businesses that meet specific criteria are required to register for GST. This online registration process grants them a unique identification number- GSTIN. This number allows businesses to collect GST on behalf of the government on their sales and claim input tax credits for the GST paid on their purchases. There are several advantages to GST registration online. This blog will teach the GST registration eligibility requirements, key benefits, and the documents needed to complete the process.

What is GST Registration?

GST Registration is the process mandated by the Indian government for businesses to obtain a Goods and Services Tax Identification Number (GSTIN). This unique 15-digit number is a licence for the business to operate within the GST framework. It identifies you as an authentic supplier of goods and services and allows you to collect tax on behalf of the government on your sales. With a GSTIN, you can claim input tax credits to reduce your tax burden by offsetting the GST paid on purchases from registered suppliers. However, certain categories of businesses must register regardless of turnover, such as those making interstate supplies or operating through e-commerce platforms.

Types of GST Registration

Not all businesses need to register for GST. Here's a breakdown of the most common types of GST registration:

• Regular GST Registration: This is the standard registration for businesses exceeding the turnover threshold or those involved in interstate supplies. It requires filing regular GST returns.
• Composition Scheme Registration: This simplified scheme benefits small businesses with a lower turnover limit. It offers a flat tax rate but restricts claiming input tax credits.
• Casual Taxable Person Registration: This category applies to businesses making occasional taxable supplies exceeding the threshold but not exceeding a specific limit in a year.
• Non-Resident Taxable Person Registration: Foreign businesses supplying services electronically to unregistered Indian recipients need to register under this category.
• Input Service Distributor (ISD) Registration: Businesses providing specific input services to multiple recipients must register as an ISD.
• Tax Deducted at Source (TDS) & Tax Collected at Source (TCS) Registration: Certain businesses are required to deduct or collect tax at source on specific supplies and deposit it with the government.
• E-commerce Operator Registration: Online marketplaces facilitating supplies between vendors and consumers need to register under this category.
• Unregistered Dealer (URD) Composition Scheme: This scheme allows specific unregistered dealers to supply certain goods at a compounded tax rate.

Also Read: What is GST (Goods & Services Tax)? Meaning & Types of GST Returns

Benefits of GST Registration Online

Registering for GST online unlocks a multitude of benefits for your business. Here are some key benefits of GST registration to consider:

• Compliance and Credibility: A GSTIN signifies compliance with tax regulations, enhancing your business's legitimacy and trustworthiness in the eyes of customers and partners.
• Input Tax Credit Advantage: Claiming input tax credit on purchases made for business purposes significantly reduces your overall tax liability.
• Simplified Interstate Trade: GST registration eliminates the need for separate permits for interstate sales, facilitating seamless cross-border transactions.
• Enhanced Transparency: The online GST system promotes a more transparent tax environment, reducing the risk of tax evasion.

Also Read: Structure of GST in India: Breakdown of the Four-Tier System

All About the GST Registration Process

GST registration and getting a GSTIN is a simple online process through the official GST portal. The first step is to gather the required documents, including your business PAN card, Aadhaar details, proof of business registration (like a certificate of incorporation), and bank account information. Once you have the documents in order, you will initiate the online application by providing basic business details like your trade name and constitution. You will also need to submit information about the promoters or directors of the business. The process involves verification steps using OTPs sent to your email and mobile number. In some cases, you may be required to provide additional details like the nature of your business activities and bank account details. Following successful verification and approval by the authorities, you will receive your unique 15-digit GSTIN. This GSTIN allows you to collect GST on behalf of the government on your sales and claim input tax credits on purchases made from registered suppliers.

Documents Required for GST Registration

The online GST registration process requires you to submit some key documents. Here's a quick checklist of the documents for GST registration:

• PAN Card (of the business and authorised signatory)
• Aadhaar Card (of the proprietor/directors)
• Proof of Business Registration (Certificate of Incorporation, Partnership Deed, etc.)
• Bank Account Details

Also Read: What is CGST & SGST? Key Differences Between Them

Easy Steps to Register for GST Online

Here are the steps involved:

• Visit the GST portal at https://www.gst.gov.in.
• Click on ‘Register Now’ under the ‘Services’ tab.
• Select ‘New Registration’ and complete the required details, including your PAN, email address, and mobile number.
• You will receive a Temporary Reference Number (TRN) on your screen. Note down this number for further steps.
• Next, visit the portal again and enter the TRN number and captcha details.
• An OTP will be sent to your email and mobile number, which you will need to enter to proceed.
• You will then be able to fill out the remaining sections of the application and upload the required documents.
• Once you have uploaded the documents, you must verify your application using an Electronic Verification Code (EVC), a Digital Signature Certificate (DSC), or the e-Sign method.
• After verification, you will receive an Application Reference Number (ARN) to your email and mobile number

Also Read: GST and Its Various Facets

GST Registration Fees

Contrary to popular belief, there's no direct fee levied by the government for GST registration itself. The online registration process on the GST portal is completely free of charge. However, it's important to remember that there may be associated costs depending on your chosen registration method.

How to Get a GST Number?

Securing a GST number online is an easy process. Here are the steps:

• Prepare documents like PAN card, Aadhaar details, and proof of business registration.
• Visit the GST portal and begin registration by providing basic business information.
• Complete verification steps using OTPs and submit any additional details requested.
• Upon successful approval, your unique 15-digit GST identification number will be issued.

How to Check GST Registration Status Online?

The GST portal allows you to check the status of your GST registration application conveniently. Here's how:

• Go to the official GST portal (https://www.gst.gov.in).
• Under the "Services" tab, locate "Registration" and then "Track Application Status."
• Input your Application Reference Number (ARN) received during application submission and complete the captcha verification.
• The portal will display the current status of your application, including any processing stages or updates.

Also Read: What is the GST Composition Scheme? Check Benefits, Rules & Limits

How to Download the GST Registration Certificate?

Once your GST registration is approved, you can download your official certificate electronically:

• Access the GST portal using your registered credentials.
• Go to "Services" followed by "User Services" and then "View/Download Certificate."
• You'll see a list of available certificates, including your GST Registration Certificate (Form GST REG-06). Click the download icon to save the PDF document.

Penalty for Not Obtaining GST Registration

Failing to register for GST when you are eligible can result in penalties and legal repercussions. The exact penalty amount depends on the nature of the offence. In general, you may be liable to pay a penalty of up to 100% of the tax amount due on your taxable supplies. There's also a minimum penalty of Rs. 10,000 that can be imposed. Furthermore, non-registration can lead to restrictions on carrying out your business activities. You may be denied access to input tax credit benefits and face difficulties in claiming refunds for taxes paid on purchases. In severe cases, authorities might even initiate legal proceedings against your business.

Also Read: Difference Between GSTR 2A and GSTR 2B

Why is GST Registration Important for Business Loans?

Obtaining a GST registration holds significant advantages when seeking a Business Loan. Here's how it can benefit you:

• Enhanced Credibility: A GSTIN signifies compliance with tax regulations, projecting your business as legitimate and trustworthy to lenders.
• Simplified Loan Process: GST registration often streamlines the loan application process, as lenders can easily access your financial records and tax filings.
• Eligibility for GST Loan Products: Certain loan products like GST Business Loans are specifically designed for GST-registered businesses, offering potentially easier access to capital.

Conclusion

Securing a GST registration can significantly improve your chances of obtaining a Business Loan. It demonstrates to lenders that your business operates within the legal framework and fulfils tax obligations. This enhances your credibility and makes you a less risky borrower in their eyes. Additionally, a GSTIN simplifies the loan application process as lenders can readily access your GST filings for financial assessment. Moreover, GST registration might unlock eligibility for specific loan products designed for GST-registered businesses, potentially offering more favourable terms and easier access to capital.

Frequently Asked Questions

1. Is an Aadhaar card mandatory for GST registration?

Aadhaar authentication is not mandatory for GST registration unless you fall under a specific category mandated by law. However, every applicant can opt for Aadhaar authentication for faster processing. Non-residents, foreign citizens, and those already registered under GST are exempt from mandatory Aadhaar linking.

2. Can a business have multiple GST registrations?

Generally, a business should only have one GST registration for its entire operation in India. However, there are exceptions. You might need separate registrations if:

• You have separate branches in different states that function as independent units.
• You operate under distinct business verticals subject to different tax rates.

3. Do I need a separate GST registration for each state?

No, you don't need a separate GST registration for each state. A single GST registration allows you to conduct business across India. However, you'll need to inform the GST department about any interstate supplies or business activities in other states.

4. Is there a validity period for GST registration?

A GST registration has permanent validity as long as your business remains operational and fulfils its tax obligations. You don't need to renew your registration unless there's a change in your business constitution or details.

5. When will I receive my GST number (GSTIN)?

The timeframe for receiving your GSTIN depends on the authorities' processing time. If your application is complete and verification is successful, you can expect your GSTIN within 3-7 working days on average.

Disclaimer

The information provided in this blog post is intended for informational purposes only. The content is based on research and opinions available at the time of writing. While we strive to ensure accuracy, we do not claim to be exhaustive or definitive. Readers are advised to independently verify any details mentioned here, such as specifications, features, and availability, before making any decisions. Hero FinCorp does not take responsibility for any discrepancies, inaccuracies, or changes that may occur after the publication of this blog. The choice to rely on the information presented herein is at the reader's discretion, and we recommend consulting official sources and experts for the most up-to-date and accurate information about the featured products.