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So, you have a great idea—to launch an e-commerce site that sells urban clothing. But you are curious about Taxes, specifically the GST. "What is the GST, and what is the step-by-step process for registering for a GST number?" you might be wondering. This article provides the answer to these and all the questions you might have about GST.

So, What is the GST Registration Number?

GST is the abbreviation for Goods and Services Tax, which is an indirect tax - specifically, the one that subsumes other indirect taxes like the excise duty, VAT, etc. - that service providers and manufacturers have to pay. It is inherently new, as it was passed in the Parliament barely seven years ago on 29 March 2017 and came into effect on 1 July 2017.

Type: Indirect Tax

Law: 1 July, 2017.

Controlled: GST Council

Rates: Uniform across states

Slabs: Four

What Are The Benefits of GST Registration Number?

Taxes are great, as they are a fundamental means by which the government safely raises funds for spending rather than simply printing money, which leads to inflation.That said, paying taxes is usually not a fun or simple thing to do. But, believe it or not, there are several benefits to getting a GST registration number.

1. Claiming Input Tax Credit

Under the GST regime, you, as a manufacturer or even a wholesale buyer—practically all stakeholders in the production process—can claim an input tax credit (ITC), meaning you can deduct the GST paid at the earlier stages of production before adding your own tax liability to the price of the product.

2. Online Tax Payment - added convenience and transparency

The entire GST process is done online, from filing returns to paying taxes, greatly reducing the past hassles of paying taxes and increasing transparency.

3. Elimination of the Cascading Effect

A major benefit( to both businesses and the end buyer) of the GST is the complete elimination of the "tax on tax" scenario and its unpleasantries. With the Input tax credit, stakeholders pay only the tax specific to the value they added at their level. In essence:

1. The cost of production is reduced, which positively affects sales
2. Consumers or clients get to pay less for end products

4. Centralized Tax Control and Uniform Rates

Before the GST regime, manufacturers were burdened with several indirect taxes, including Excise Duty, central sales tax (CST), Service Tax, etc.; but with the GST, a unified tax rate exists and is determined by the central body. A uniform tax rate enhances the entire tax payment process. by reducing confusion.

5. A Boost for Business Growth

A simplified tax structure is a huge incentive for people to start and grow their businesses. Taxation and dealing with it was often a major barrier to starting businesses in the past. The GST regime has greatly reduced this barrier.

6. Reduced Tax Evasion

There is less incentive to evade tax under the GST. The entire process is online and easy to execute. Also, eliminating the cascading tax effect ensures manufacturers and service providers can maximize profitability, which also serves as an added incentive not to evade tax.

Who Should Register For GST in India?

You probably are wondering - 'I own a travel agency. Am I liable to pay GST?"

Well, several factors must prevail for someone to be liable to register for GST in India. The Goods and Services Tax (GST) Act 2017 is quite nuanced, as it covers a wide range of applications regarding who should register for GST. Summarily:

• Any businesses with an annual turnover that exceeds the threshold limit of ₹40 lakhs are liable to pay GST, and this applies to most states. For some special category states, if the turnover exceeds ₹20 lakhs or ₹10 lakhs, then the owners are expected by law to pay GST.

Other factors that qualify entrepreneurs to pay GST include:

1. All businesses that provide goods and services interstate, irrespective of turnover.
2. All E-commerce businesses.
3. Non-residents who are taxable.
4. People under the reverse charge mechanism must pay GST.
5. Individuals who pay tax, based on the recommendation of the GST council.
6. Agents or representatives who act on behalf of taxable persons.
7. Businesses under certain sectors, like aggregators and exports.

Visit the GST Portal for more details on the turnover thresholds and exemptions to ensure your compliance with GST registration requirements.

What Are The Documents Required For GST Registration In India?

Normally, when registering for GST, you need certain documents. Thankfully, the process is online, so you won't have to run around with papers flying around.

Also, the documents required for GST registration are often determined by the category of business you are running, either Sole Proprietorship, Partnership, HUF, or company. However, the main documents include:

1. PAN Card
2. Proof of Business Registration
3. Photograph
4. Proof of Identity
5. Proof of Address of owners of business
6. Proof of Address of business
7. Bank statements

What Is The Step-By-Step GST Registration Process?

Step 1: Determine Eligibility

The first step is to determine whether you are eligible for GST registration. In a previous section, we discussed some of the criteria to be met as laid down by the Goods and Services Tax (GST) Act, 2017. In summary, there are three areas to look out for.

Turnover limit: If your business's annual aggregate turnover exceeds the prescribed threshold—depending on your state—you are required to register for GST.

Inter-State Supply- As long as you provide services or supply goods across states, you are liable to pay GST, irrespective of your annual turnover.

Business Type- Certain businesses are required by law to pay GST. Check to make sure yours is not included.

Step 2: Gather Required Documents

The last thing you want is to have to truncate the registration process because you do not have a copy of your proof of address, or one of your partners has not yet provided a photograph of themself. So, ensure you gather the required documents being demanded. Apart from the major documents mentioned in a previous section, gather other documents that are stated as required specific to the structure of the business you are running.

Step 3: Online Registration

Follow these steps to register for GST:

• Visit the GST portal: Visit the GST official portal (https://www.gst.gov.in/). Click accordingly:

Also Learn: What is a Limited Liability Partnership or LLP

Services - Registration - New Registration.

• Fill out the application: Fill in the necessary fields as required with your details. Ensure you put in the right information.

NOTE; You will receive an OTP and Application reference number (ARN) through the number and email you provided for verification. Note that your ARN is meant for tracking your application.

• Verification and documentation: The details you provided will be verified. If there is a need for more documentation, you will be informed by a GST officer. Ensure to respond promptly.

As you await the verification, you can track your application to know your status. To do this, Visit the GST portal and click accordingly:

Services - Track Application Status(Enter your Application Reference Number (ARN) - Search.

Once you click SEARCH, the portal will display the current status of your application, whether it is pending, approved, or rejected.

Once you pass the verification process, you will be allotted a GST Identification Number (GSTIN). You will also get a GST registration certificate. Your GSTIN is a unique 15-digit identification number specifically for your business.

Step 4: Download GST Certificate

Go ahead and download the GST certificate from the GST portal. To do this, Visit the GST portal, log in using your credentials, and click accordingly.

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Services - Downloads - Certificates - Download

Upon clicking Download, your certificate will be downloaded to your device in PDF format.

Note: After registering for a GSTIN, it often takes a maximum of 7 days before you get it. However note that the entire process can take longer depending on the accuracy of the information you provide and the availability of the documents required from you.

Also Learn: A Quick Guide to Pvt Limited Company

Faq. GST Registration number

1. How is the calculation of GST done in India?

Calculating your GST is easy.

When the price is exclusive of GST:

GST Amount = (Value of supply x GST%)/100

Price to be charged = value of supply + GST Amount

When the price is inclusive of GST:

GST Amount = Value of supply – [Value of supply x {100/(100+GST%)}]

2. How many GST slabs are there in India

The GST rate list comprises four slabs, namely 0%, 5%, 12%, 18%, and 28%.

3. Can we sell on Amazon without GST?

No, Amazon is not GST-free. You are required by law to charge GST on most items. However, certain products are exempt.

4. Are there any courses on GST to learn more about it?

You can get courses on GST on popular LMS sites like Coursera and Udemy.

5. GST is a direct or indirect tax, clarify?

GST is an Indirect tax.

6. What is the GST launch date in India?

GST was passed in the Parliament on 29 March 2017 and came into effect on 1 July 2017.

7. Is there a GST toll-free number you can contact?

GST Help Desk Number is 1800-103-4786

8. Is there a GST late fee calculator that can help you determine the penalty amount?

Several sites provide a GST late fee calculator.

9. How much is the GST on mobile phones?

The current GST rate on mobile phones is 18%

10. What is GSTIN?

GSTIN is short for Goods and Services Tax Identification Number. It is a unique 15-digit number allotted to every person who registers for GST.

Also Learn: 7 Proven Strategies for Tax Planning For Corporates