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In today’s article, we are going to discuss the rules of registration based on turnover. So, if you want to enhance your knowledge about GST or need to get GST registration, you must not ignore these important details.
What should be the minimum turnover for registration in GST?
Any person who supplies goods or services, if his turnover exceeds a specified limit, then it is mandatory for him to get registered in GST. If he does not do so, then a penalty can also be imposed on him according to the GST Act.
How much turnover limit will be applicable for GST Registration on a person, it depends on 4 things–
- Both Goods and Services are being supplied,
- Only the goods are being supplied,
- Only services being supplied,
- In which state the goods will be supplied by the person.
Both Goods and Services are being supplied:
If a person is supplying both goods and services, then it will be mandatory for that person to get GST Registration if the total turnover of the business is more than Rs 20 lakh (in special category states, this limit is up to Rs 10 lakh) in a financial year. (Read More: Faqs About GST And To Whom You Should Turn For GST Registration?)
The limit of turnover of 20 lakhs will be applicable in a case where the goods and services are being supplied by that person within a state.
If that person supplies goods and services outside the state, then it will be mandatory for him to get registered in GST even if his turnover is only Rs 1000.
Example: Intrastate supply is done by Mr. A in Rajasthan and total turnover is Rs 18 lakhs, then Mr. A doesn’t need to get registered in GST.
But if Mr. A want to supply goods in Delhi also, then he has to first get registered in GST. Because it will become a case of interstate supply. It will not matter if his turnover is less than Rs 20 lakhs.
Only Goods are being supplied:
If only goods are being supplied by a person and are being supplied in the same state, then the limit of registration in GST on that person will be Rs 40 lakhs.
However, this limit will be 20 lakh/10 lakh applicable in special category states, which we will discuss further.
Example – Mr. A supply only goods in Rajasthan and his total turnover is Rs. 28 lakhs, then Mr. A will not be required to do GST registration, as his turnover is less than Rs. 40 lakhs.
But Mr. A now wants to supply any kind of services also in Rajasthan, then it will become mandatory for him to get GST registration, as the limit is 20 lakhs in case of a supply of both goods and services.
Only services being supplied:
If only services are being supplied by a person, then in this case the GST registration turnover limit of Rs 20 lakh (10 lakh in special category states) will be applicable.
The biggest advantage in the case of a person supplying only services is that even if the services are inter-state supplied by that person, registration will be mandatory only if the total turnover exceeds Rs 20 lakh.
Example – Goods are supplied in Delhi by Mr. A who lives in Gujarat, then it will be mandatory for Mr. A to get registered in GST because Inter-State Supply of Goods is being done by him.
But if Mr. If A was supplying taxable services instead of goods in Delhi, he would not have had to get registered till his total turnover did not exceed Rs 20 lakhs.