Best Practices for Financial Management in Small and Medium-Sized Enterprises (SMEs) in Kerala
August 30, 2024
In India, registration under the Goods and Services Tax (GST) is mandatory for certain individuals and businesses based on specific criteria. Here’s who is required to register under GST:
Businesses with Aggregate Turnover Above the Threshold Limit
\Any service provider whose annual aggregate turnover exceeds ₹20 lakh (₹10 lakh in special category states) in a financial year must register for GST. Any supplier of goods whose annual aggregate turnover exceeds ₹40 lakh (₹20 lakh in special category states) in a financial year must register for GST.
Inter-State Suppliers
Any business involved in the supply of goods or services across state borders, irrespective of turnover, must register under GST.
E-commerce Operators
Any person or entity operating an e-commerce platform, facilitating the supply of goods or services, must register under GST. This includes those supplying goods or services through e-commerce platforms.
Casual Taxable Persons
A person who occasionally supplies goods or services in a territory where GST is applicable, but does not have a fixed place of business in that territory, must register under GST, regardless of turnover.
Non-Resident Taxable Persons
Non-residents making taxable supplies of goods or services in India must register under GST, irrespective of turnover.
Agents of a Supplier
Any person acting as an agent on behalf of another registered taxable person must register under GST.
Persons Paying Tax Under the Reverse Charge Mechanism
Businesses and individuals required to pay tax under the reverse charge mechanism must register under GST.
Input Service Distributors
Businesses that distribute the input tax credit of goods or services to other branches under the same PAN must register under GST.
Voluntary Registration
Even if a business does not fall under the mandatory criteria, it may choose to register voluntarily under GST to avail the benefits of input tax credit and to be eligible to collect GST from customers.
Persons Supplying Online Information and Database Access or Retrieval (OIDAR) Services
Non-resident service providers supplying OIDAR services to unregistered persons in India must register under GST.
Businesses Under the Composition Scheme
Businesses with a turnover of up to ₹1.5 crore (₹75 lakh for special category states) can opt for the Composition Scheme and register under GST to pay taxes at a lower rate.
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