Taxable Person under GST

A ‘taxable person’ under GST, is a person who carries on any business at any place in India and who is registered or required to be registered under the GST Act. Any person who engages in economic activity including trade and commerce is treated as a taxable person.

‘Person’ here includes individuals, HUF, company, firm, LLP, an AOP/ BOI, any corporation or Government company, body corporate incorporated under laws of foreign country, co-operative society, local authority, government, trust, artificial juridical person.

Latest Updates on GST Registration

Budget 2023 Update
1st February 2023
Budget 2023 substitutes section 23 of the CGST Act retrospectively w.e.f. 1st July 2017. This amendment clarifies that persons mentioned in section 23 don't have to obtain registration even if they fall under any conditions mentioned in sections 22(1) and 24 of the CGST Act.

21st December 2021
From 1st January 2022, CBIC made the aadhaar authentication mandatory to apply for revocation of cancelled GST registration under the CGST Rule 23 in REG-21.

29th August 2021
Taxpayers can get extended time up to 30th September 2021 to revoke cancelled GST registration if the last date for the same falls between 1st March 2020 and 31st August 2021. It applies if the GST registration is cancelled under Section 29(2) clause (b) or (c) of the CGST Act via CGST notification number 34/2021 dated 29th August 2021.

28th May 2021
Due date to file application for revocation of cancellation of registration falling between 15th April 2021 up to 29th June 2021 is 30th June 2021. 

1st May 2021
The time limit to take actions, reply or pass orders as given under Rule 9 of the CGST Rules, 2017 that falls between 1st May 2021 and 31st May 2021 has been extended up to 15th June 2021.

5th March 2021
The Search ARN Functionality for Registration, post-TRN Login has been enhanced for the taxpayers.
 

Who is Liable to get Registered under GST? 

GST registration is mandatory for-

• Any business involved in the supply of goods whose turnover in a financial year exceeds Rs.40 lakhs for Normal Category states (Rs.20 lakhs for Special Category states)*
• Any business involved in the supply of services whose turnover in a financial year exceeds Rs.20 lakhs for Normal Category states (Rs.10 lakhs for Special Category states)
• Every person who is registered under an earlier law (i.e., Excise, VAT, Service Tax etc.)  needs to register under GST, too.
• When a business which is registered has been transferred to someone/demerged, the transferee shall take registration with effect from the date of transfer.
• A person making inter-state supplies
• Casual taxable person (see below)
• Non-Resident taxable person (see below)
• Agents of a supplier
• Those paying tax under the reverse charge mechanism
• Input service distributor (see below)
• e-Commerce operator or aggregator*
• Person who supplies via e-commerce aggregator
• Person supplying online information and database access or retrieval (OIDAR) services from a place outside India to a person in India, other than a registered taxable person

Note: If your turnover is supply of only exempted  goods/services which are exempt under GST, this clause does not apply.

Also, Budget 2023 substitutes section 23 of the CGST Act retrospectively w.e.f. 1st July 2017. This amendment clarifies that persons mentioned in section 23 don't have to obtain registration even if they fall under any conditions mentioned in sections 22(1) and 24 of the CGST Act. CBIC is yet to notify this change.

*Some Normal Category states have chosen to continue with the existing limit of Rs.20 lakh, and some Special Category states have opted for an increased limit of Rs.40 lakh.

**e-commerce sellers/aggregators need not register if total sales is less than Rs. 20 lakh. Notification No. 65/2017 – Central Tax dated 15th November 2017
 

Who is a Casual Taxable Person under GST?

A person who occasionally supplies goods and/or services in a territory where GST is applicable but he does not have a fixed place of business. Such a person will be treated as a casual taxable person as per GST. 

Example: A person who has a place of business in Bangalore supplies taxable consulting services in Pune where he has no place of business would be treated as a casual taxable person in Pune.

Who is a Non-Resident Taxable person under GST?

When a non-resident occasionally supplies goods/services in a territory where GST applies, but he does not have a fixed place of business in India. As per GST, he will be treated as a non-resident taxable person. It is similar to above except the non-resident has no place of business in India.

Who is an Input Service Distributor?

‘Input Service Distributor’ means an office of the supplier of goods/services which receives tax invoices on receipt of input services and issues tax invoices for the purpose of distributing the credit of CGST/SGST/IGST paid on the said services to your branch with the same PAN. (It must be a supplier of taxable goods /services having the same PAN as that of the office referred to above). 

Thus, only credit on ‘input services’ can be distributed and not on input goods or capital goods. This will be a new concept for assessees who are currently not registered as input service distributors. However, this facility is optional in nature.

Who is a composition taxpayer?

A composition taxpayer refers to those registered under the composition scheme who need not collect GST from his customers at normal rates. Instead, he can pay tax at a nominal rate or lower rates to the government on the basis of turnover or receipts on a quarterly basis while filing CMP-08.

There are certain conditions defined for such taxpayers. At the inception of GST, only suppliers of goods could opt into the composition scheme governed by Section 10 of the CGST Act with annual turnover upto Rs.1.5 crore. From 1st April 2019, service providers are also given an option to join a similar scheme. The annual aggregate turnover limit must be up to Rs.50 lakh.

Who is a QRMP taxpayer?

A registered person who is required to furnish a return in GSTR-3B, and who has an aggregate turnover of up to Rs.5 crore rupees in the preceding financial year, is eligible for the QRMP Scheme. Under the scheme, one can file GSTR-1 and GSTR-3B once in a quarter whereas make tax payment every month in form PMT-06. Further, if B2B sales invoices need to be uploaded on the GST portal monthly, then Invoice Furnishing Facility (IFF) can be used.

GST Registration by Type of Taxable Person

• Every person has to apply for registration in every State in which he is liable, within thirty days from the date on which he becomes liable to registration.
• Casual / non-resident taxable persons should apply at least five days before their commencement of business.
• Registration number in GST will be PAN based and hence, having PAN would be a prerequisite for obtaining registration.
• The assessee must obtain separate registration for each State, as registration under GST will be State-wise,
• The assessee has an option to obtain a separate registration for each of the ‘business verticals’ in the same State.

Special provisions of GST Registration for casual taxable person and non-resident taxable person 

A casual taxable person or a non-resident taxable person shall apply for registration at least five days prior to the commencement of business. Section 24 provides for special provisions relating to casual taxable persons and non-resident taxable persons under GST. 

Casual/non-resident taxable person may obtain a temporary registration for a period of 90 days (extendable for additional 90 days). A person who obtains registration u/s 24, will be required to make an advance deposit of GST (based on his estimated tax liability).

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