Why is GSTIN required?


GST implementation in India was a historical move, as it marked a significant indirect tax reform in the country. One of the most important benefits of the move is the lessening of double taxation or the removal of the cascading effect of taxation.

GST Identification Number (GSTIN) is a 15 digit number that is assigned to every GST registered person. It has replaced the earlier Tax Identification number which was allocated to businesses by state tax authorities for registering under the VAT system Further, GSTIN is State Specific therefore you have to take separate state-wise registration for branches in different states.

The online GST registration process is usually completed within 4-6 working days and the supplier is allotted a 15-digit GSTIN (GST identification number) and a certificate of registration by the GST department.

GSTIN format

GSTIN is a 15-digit alphanumeric code. The format break-down of the GST Identification number is as follows:

As per the Indian Census 2011, every state has a unique code. The first two digits represent the same

The next ten digits are the PAN number of the taxpayer

The thirteenth digit will be assigned based on the number of registration within a state

The fourteenth digit will be “Z” by default

The last digit may be an alphabet or a number. It will be for checking the code.

Need of GSTIN

Every business entity needs to obtain a unique number under GST registration to collect tax and avail input credit. It acts as a tool for GST registered taxpayers to get legally recognized as suppliers of goods and services. As per the GST rules, it is mandatory for a business/supplier that has a turnover of above Rs.40 lakhs (Rs 10 lakhs for special category states present in hill states and North-Eastern states) to register as a normal taxable entity and obtain GSTIN

Ways to apply for GSTIN

It is part of the online GST registration process. A unique GSTIN is provided to the taxpayer once the application is approved by the GST officer.

The following are the two ways to register for GST:

via GST Online Portal or

via GST Seva Kendra set up by the Government of India

Cost of online GST registration and obtaining GSTIN

Obtaining GSTIN and online GST Registration is free of cost. However, there may be charges if you take the assistance of a third party to register under GST.

Documents required for online GST registration to get GSTIN.

➢ PAN of the Applicant

➢ Aadhaar card

➢ Proof of business registration or Incorporation certificate

➢ Identity and Address proof of Promoters/Director with Photographs

➢ Address proof of the place of business

➢ Bank Account statement/Canceled cheque

➢ Digital Signature

➢ Letter of Authorization/Board Resolution for Authorized Signatory

Benefits of getting GSTIN 

➢ Legal recognition

Businesses with GSTIN is legally recognized as a supplier of goods or services which in turn helps in attracting more customers and growing business

➢ Competitive advantage

You will become more competitive than small businesses as purchasing from them will ensure input credit.

➢ The input tax credit can be claimed

A person who is having GSTIN can take input credit on their own purchases and input services

➢ Inter-state supplies without restrictions

No restrictions on interstate sales (it will be treated as casual taxable persons). Thus, the potential market for SMEs reach the next level

➢ Ensuring proper accounting and payment of GST to tax authorities

Your online GST registration will ensure that the business is GST compliant (because most

returns are automated). This will result in a good GST rating of your firm and help to boost the business.


SuperCa

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