One of the most crucial activities you must finish if you plan to start a business or already have one operating is registering it with the Department of Goods and Services Tax (GST).
Let’s first define GST before delving into the specifics of how to register your business for GST.
In order to streamline and improve the procedure of filing tax returns for businesses, the government introduced GST back in 2017.
Today, a unified taxation structure for service- and product-based firms combines several indirect taxes. The GST policy taxes goods and services where they are used, not where they are produced, making it a destination-based system of taxation.
GST in India has four separate tax slabs: 5, 12, 18, and 28 percent, depending on the type of business.
GST for Companies
Long-term, according to experts, the GST will reduce the cost of goods and services.
Prior to the introduction of the GST, the Central and State governments imposed a number of taxes, such as service tax, value-added tax (VAT), central sales tax, etc. To stop the cascading impact of taxes, the majority of these indirect taxes are now covered by the GST.
The simple and fast registration process is another benefit of GST for businesses. It eliminates expenses related to various state taxation regulations.
The fact that all GST procedures are completed online helps India’s business-friendly policies.
Businesses would require a GST registration under the GST regime, which would be valid throughout the nation.
What You Should Know About the Input Tax Credit
Businesses who want to register for GST must be aware of how the input tax credit operates.
Input tax credit suggests that you can subtract the tax you paid when you made a purchase from the tax on sales and then give the government the difference.
Use this illustration: You spent Rs 100 on the item and made a 10% tax payment. Then you sell this item for Rs 150 and charge the buyer Rs 15 in tax. You must give the government 15 rupees. You only need to pay the tax of Rs 5 because you already paid Rs 10 as your input tax credit.
However, you might not be able to use this input tax credit if you haven’t registered your business for GST. Additionally, you might not be able to use an input tax credit if you pay GST using the composition scheme, a type of GST registration.
Now that you are aware of the reasons your company needs a GST registration, you must understand the steps involved and the various requirements for GST registration.
GST Registration Types
Depending on the type of taxpayer you are, you would need to choose the appropriate GST registration type. The GST for companies in India falls into the following categories:
- Normal: You may register as a normal taxable individual if your business’s annual revenue from the sale of goods exceeds Rs 40 lakh. If your company is located in the North East or one of the hilly regions like Uttarakhand, Jammu & Kashmir, or Himachal Pradesh, the cap is Rs 10 lakh. Registration as regular taxable people may be obtained for services-led firms having an annual turnover of Rs 20 lakh and Rs 10 lakh for businesses headquartered in special states.
- Casual: For someone whose business is seasonal or irregular, this sort of GST registration is appropriate.
- Composition: This is for companies with a maximum yearly revenue of Rs. 1.5 crore. Composition taxpayers must pay tax at fixed rates on the whole amount of their sales.
- Non-resident: A non-resident Indian who is supplying products or services to India must register under this category.
How to Register Your Business for GST Step by Step:
The GST site serves as the official hub for all GST-related activities, including registration, return filing, and tax payment. Filling out all of your personal and business information, as well as authenticating them with a one-time password, are both required steps in the two-step process of registering your business for GST.
- The steps to register your company for GST are as follows:
- Access the GST website here: https://www.gst.gov.in
- Select “Registration” under the “Services” option at the top of the page.
- Select the “New registration” tab, then from the drop-down menu, choose the “Taxpayer” option.
- Enter the district, state, company name, and PAN information for your business in the form. Your contact details, such as your email address and phone number, must also be entered. After entering the OTP that you will get, you will be given a temporary reference number.
- You will receive another OTP for verification after entering this reference number.
- You will be directed to your saved application page after the verification, where you might need to fill out further information like your contact details.
- Additionally, you will be required to submit the following paperwork:
PAN card Address
Aadhaar PAN card Address
Your bank statement together with a voided check
- evidence of business formation or registration
- electronic signature
- In addition to photos, the promoter/director must provide identification and address evidence.
- Board decision or a letter of authorization from a signatory
- You will receive an application reference number after submitting the required paperwork, which you may use to check the status of your registration on the GST portal.
- Registering for GST with an Aadhaar number
- You could register for GST by confirming your Aadhaar as well. These steps make up this process:
- You will have the choice of Aadhaar authentication when you submit an application for registration.
- Enter your Aadhar number after clicking the “Yes” button on the link for authentication. Press “Validate”
- You will receive an OTP after the details are matched, which you must input to complete the registration process.
Once your application has been approved, you can download your GST registration certificate from the GST portal. This certificate of GST registration serves as documentation.
GST is a substantial change to India’s tax system. GST for enterprises makes compliance both visible and easy while streamlining and simplifying taxation. If you are a business, go to the GST portal and follow the simple instructions to register for GST.
Making your business online-friendly will give it wings once you’ve registered it for GST. Join together with Paytm Payment Gateway to begin a variety of online business activities.
Paytm Payment Gateway may be as adaptable as you need it to be, allowing your company to start receiving online payments, paying vendors, processing refunds, or obtaining working capital loans.