When is GST Registration Mandatory in India?

It is essential to understand that not all businesses are required to obtain GST registration. GST registration becomes mandatory for businesses that exceed a certain annual turnover threshold. Currently, the GST registration limits in India are as follows:

  • ₹40 Lakh: Applicable for most states and union territories.

  • ₹20 Lakh: Applicable for some special category states (excluding Jammu and Kashmir) and northeastern states.

  • ₹10 Lakh: Applicable for e-commerce traders supplying goods in special category states (including Jammu and Kashmir).

These limits apply on a financial year basis. Therefore, if you anticipate exceeding the threshold within a financial year, you should register for GST in advance.

Apart from turnover-based registration, GST registration is also mandatory in the following cases:

  1. Interstate Supply: If a business supplies goods or services across state borders, GST registration is required, regardless of turnover.

  2. E-Commerce Operators: Businesses selling goods or services through e-commerce platforms like Amazon, Flipkart, or their own websites need to register for GST.

  3. Casual Taxable Persons: Businesses that operate occasionally in different states (e.g., event-based businesses or seasonal traders) must register under GST.

  4. Non-Resident Taxable Persons: Foreign businesses supplying goods or services in India must register under GST.

  5. Reverse Charge Mechanism (RCM): If a business is required to pay tax under RCM, GST registration is mandatory.

  6. Input Service Distributors (ISD): Companies distributing input tax credit among branches need GST registration.

  7. Agents and Suppliers of Taxable Goods/Services: Agents or brokers dealing with taxable goods and services must obtain GST registration.

  8. TDS/TCS Deductors: Businesses required to deduct TDS/TCS under GST provisions must be registered.

Failure to register for GST when mandatory can lead to penalties and legal consequences. If your business falls under any of these categories, it is advisable to complete the GST registration process as soon as possible to ensure compliance and avoid fines.

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