The GST automates the compliance for various indirect tax compliances such as excise tax, service tax, CST, VAT, and others. A GSTIN is required for the taxpayer to collect and pay GST on outward supplies (sales) and claim GST credit on inward supplies (purchases).
A GST-compliant small business also pays less tax compliance fees. Due to the GST system’s implementation, small businesses and start-ups now have more time to improve their operations and explore new opportunities.
The installation of GST has also resulted in the establishment of centralized registration, which simplifies the process of starting a new business while reducing high administrative costs formerly incurred due to multiple state tax incidences. Moreover, the need for business loans has also increased dramatically, which greatly benefited the economy. Let’s discuss the types of GST registration.
There are several types of GST registrations
Under the GST Act, GST can be registered in several ways. Consider the various options before choosing the best form of GST registration. GST registration types include:
Taxable Person – Normal
Almost all Indian companies face this challenge. You do not need to deposit to become a regular taxpayer. As well, these taxpayers do not have to renew their enrollments because their GSTIN does not expire.
All businesses with revenue between Rs 1.5 crores and Rs 1.5 crores are eligible to apply for the composition scheme. To determine the turnover for the composition scheme, the combined turnover for all businesses with the same PAN must be taken into consideration. It should be noted, however, that such taxpayers can’t claim an input tax credit for their business.
Persons who are taxable but are not residents
Non-resident taxable persons visit India occasionally and do business. In India, a non-taxable person cannot have a fixed place of business.
According to Section 2 (69) of the GST Law, a taxable person living outside of India and visiting India occasionally for the purpose of dealing but without a permanent place of business in the country is considered a non-resident taxable person.
Casual taxpaying individual
A majority of people who start their own businesses have a permanent office or other locations. A casual taxable person is one that doesn’t have a permanent office, factory, or another place of business. Despite the fact that they may conduct business in an irregular manner, they must pay GST.
In order to apply for registration under section 19, a casual taxable person must pay an advance deposit of tax equal to the estimated tax liability for the period for which the registration is sought when submitting an application, whereas a normal taxable person does not have to pay any money upfront to obtain registration.