In 2017, India introduced the Goods and Services Tax (GST), an indirect tax regime. It controls the flow of goods and services from the manufacturing to the consumer sectors as a single tax. The GST Council, which determines the tax rate and other pertinent issues, is made up of the finance ministers from each state. In response to requests from MSMEs, the GST Council strengthened the limitations on the GST registration threshold. These changes were suggested at the 32nd GST Council meeting on January 10, 2019. It was subsequently alerted by the CBIC. It makes GST compliance simpler. This article describes the GST registration threshold limits. It draws attention to the people who are impacted, the prior threshold limits, and the new GST registration restrictions.
Minimum Turnover Limited for GST Registration:
If a company’s yearly revenue surpasses Rs. 40 lakhs for goods and Rs. 20 lakhs for services, they are required to register for GST and pay taxes on their taxable goods and services. Businesses with yearly sales less than Rs. 40 lakh are not required to register for GST, while they are welcome to do so voluntarily.
It should be noted that the minimum turnover requirements for GST vary throughout India’s special category states. In these special category states, the minimum threshold limits for the supply of goods are Rs. 20 lakhs, and the minimum threshold limits for the provision of services are Rs. 10 lakhs.
| Products/Services | State Type | Threshold Until Mar 31, 2019 | Threshold From Apr 1, 2019 |
| Goods | Normal Category States | Exceeds Rs. 20 lakh | Exceeds Rs. 40 lakh |
| Special Category States | Exceeds Rs. 10 lakh | Exceeds Rs. 20 lakh | |
| Services | Normal Category States | Exceeds Rs. 20 lakh | Exceeds Rs. 20 lakh (as same) |
| Special Category States | Exceeds Rs. 10 lakh | Exceeds Rs. 10 lakh (as same) |
The following table showing the GST Turnover Limit state-wise.
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Normal Category States/UT who opted for a new limit of Rs.40 lakh
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Kerala, Chhattisgarh, Jharkhand, Delhi, Bihar, Maharashtra, Andhra Pradesh, Gujarat, Haryana, Goa, Punjab, Uttar Pradesh, Himachal Pradesh, Karnataka, Madhya Pradesh, Odisha, Rajasthan, Tamil Nadu, West Bengal, Lakshadweep, Telangana, Dadra and Nagar Haveli and Daman and Diu, Andaman and Nicobar Islands and Chandigarh
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Special Category States/UT who opted for new limit of Rs.40 lakh
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Jammu and Kashmir, Ladakh and Assam |
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Special Category States/UT who opted for new limit of Rs.20 lakh
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Puducherry, Meghalaya, Mizoram, Tripura, Manipur, Sikkim, Nagaland, Arunachal Pradesh and Uttarakhand |
Categories where GST Registration Is Mandatory
- Temporary Taxable Individuals
- Taxable individuals who are not residents
- Interstate vendors
- Individuals who must withhold TDS/TCS under the GST
- Individuals subject to the reverse charge basis
- Distributors of input services
- Every e-commerce business that provides a platform for suppliers to create supply through
- Suppliers who distribute goods through internet merchants are in charge of withholding taxes at the source.
- Persons participating in a transaction on behalf of another individual as Principals or Agents
- Internet service providers who come to India and sell their services to those who are not registered.
Citation of Aggregate Turnover all GST Types
| Type of GST Nature of Business | Threshold Limit |
| Normal / Regular | Aggregate turnover in a financial year |
| Composition Scheme | Aggregate turnover in the previous financial year |
| E-Invoicing | Aggregate turnover in any preceding financial years from FY 2017-18 |
| GST Audit | Aggregate turnover during a financial year |
| Compulsory HSN Code | Aggregate turnover in the previous financial year |
| Tax collection by State | Turnover limit in the State |
Composition Scheme – Change in Limitation
An alternate taxation technique called the composition levy is intended for small taxpayers with annual revenue up to Rs. 75 lakhs (or Rs. 50 lakhs in certain states). The goal of the composition system is to simplify and lower the cost of compliance. for the modest taxpayers. Additionally, it is voluntary, with the qualified individual choosing to pay taxes can pay tax under this plan at a certain quarterly proportion of his turnover, rather than making a regular tax payment.
Conclusion:
Registering for GST is an important aspect of effective company administration, as it affirms credibility and compliance with laws. If the annual income of a company surpasses ₹40 lakhs, it must enrol under the GST laws. Understanding that meeting turnover requirements, possessing a valid PAN Card, and conducting taxable transactions of goods and services are necessary for qualifying for GST is crucial. Meeting these requirements not only ensures compliance but also brings benefits such as reduced compliance expenses, streamlined tax procedures, and heightened competitiveness. Companies need to align strategically with the GST regulations to enhance operational efficiency and enhance brand reputation.
Know more: Consent Letter For Gst Registration
