The Goods and Services Tax (GST) is one of the most debated topics in India. While people shy away from giving their opinion on it, they often fail to explain what GST is. This is where the root of the problem is. How can you discuss its pros, cons, and factors until you know what it means and why it was implemented in India? Here is what you should know about the GST.
What is Goods and Services Tax?
Back then, every business owner, big and small, suffered economically in India because taxes were regulated by the states instead of the Central Government. Thus, different rates of taxes applied everywhere. Consequently, the price of the same commodity would vary across states. For example, if the price of a bottle of mineral water was INR 30 in Kolkata, then it was possible that the same bottle of mineral water would cost around INR 50 in Bangalore. There was a huge disparity, and this was not working well for the citizens. The Indian Government abolished the payment of multiple taxes and implemented a single tax known as the GST. GST aims to bring economic growth and prosperity in India. It follows the principle of ‘One nation, one tax.’
Which Government body levies GST?
Now that you know the meaning of GST, you must understand who levies it. As explained above, it was implemented by the Central Government because it wanted to make tax payments a Central affair. However, this does not imply that the states do not have any involvement in the tax system anymore. Read ahead to know who levies GST and what are its different components.
- CGST: The CGST is levied by the Central Government.
- SGST: The SGST is levied by the state governments.
- The Central Government must levy taxes on transactions that take place between states.
- In case the state faces any loss, then the Parliament has to take responsibility and provide compensation to the State.
Documents needed for GST Registration:
- PAN card details
- Aadhaar card of the candidate
- The candidate’s bank account statement and a canceled cheque
- Address proof of the business’ location
- Proof of business registration
- Digital signature of the candidate
- The Director’s address proof, ID proof, and passport-size photographs
- The authorized Signatory should have the Letter of Authorization
What happens if you do not register for GST?
Registering and complying with GST rules is not an option, it is compulsory. In case you do not pay taxes in a timely fashion, or you do not pay the required amount, you will face a penalty of 10% of the total tax amount. However, do note that you will have to pay a minimum penalty of INR 10,000. Also, if you do not complete your GST registration and try to evade the payment of taxes, then you will receive a penalty of 100% of the total tax amount that you need to pay.
What are the different categories of GST registration?
- A common taxpayer
- A casually taxable person
- Composition taxpayer
- Non-resident taxable person
- Non-resident online service provider
- Government entities
- E-commerce companies
How to Complete GST online Registration?Here is how you carry out the GST online registration:
- The first step is to visit the online GST portal, where you will see an option to register online. You can locate this easily under the taxpayers’ tab.
- Then, you need to select the option for new registration. On the same page, you will need to fill some details like you are a taxpayer, your respective state and district, your business’ name, the business PAN, the required email address and phone number, etc. Please note that you will receive an OTP that you must enter.
- After you have entered the OTP, you will be directed to a page where you will get your TRN. This stands for Temporary Registration Number. Remember to make a note of this number.
- Finally, go back to the main menu of the GST portal, and after clicking on register now, select the option that says TRN.
- Please enter the TRN and captcha details. You will receive a One Time Password that you need to enter and click on ‘Proceed.’
- The next page will show the status of your application. An edit icon on the right side of the screen will lead you to another page that has 10 sections. Some of the documents that you need to upload are your photographs, address proof of business’ location, bank details, an authorization form, and the taxpayer’s constitution.
- Finally, you must visit the ‘Verification’ page. Here, you can use one of the three- an electronic verification code sent on your mobile number, an electronic sign, or a digital signature certificate.
- After the above-mentioned steps have been completed successfully, your screen will show you a message of completion. An Application Register Number, also known as ARN, will be sent to your registered mobile number and email address. You can use your ARN to track your application’s status on the online GST portal.
Thus, online registration for GST billing software is not time-consuming and easy to understand. All you need to do is assemble your documents and provide the correct details when you are registering online.