MSMEs (Micro, small and medium enterprises) are one of the most important parts of India’s GDP and contribute 29% to the GDP, 40% to exports, and 60% to employment. However, before you can start growing, you need to complete your GST (Goods and Services Tax) registration. In India, GST Registration is mandatory by law once you cross a particular annual turnover limit.

It helps your business stay legal and tax compliant, and also lets you claim input tax credits. Even though you can complete the GST registration process online, most business owners feel confused when registering for the first time, as there are a lot of steps, documents, and processes. This guide will discuss how to register for GST in a few simple steps.

Who Needs to Register for GST in India?

According to the Indian government, you need to register for GST if:

• Your turnover from services is more than ₹20 lakh annually
• Your turnover from goods is more than ₹40 lakh annually (₹10 lakh in specific states)
• You deal in interstate supplies of goods or services with a turnover of over ₹20 lakh (e.g., selling online goods to another state).
• You deal in goods through e-commerce operators like Amazon, Flipkart, or Meesho.
• You offer taxable services to clients in more than one state, e.g., consulting or marketing.
• You have a temporary or seasonal shop outside of your state.
• You are a foreign company that is selling goods or services in India.
• You are a company that distributes tax credits to various branches.
• You are an agent of a taxable supplier that sells taxable goods or services.

Voluntary GST Registration

You can apply for GST registration even if you don’t fall under the mandatory requirement. This is called voluntary GST registration. Here is how you can benefit from voluntary GST registration:

• Claim Input Tax Credit (ITC): Businesses get ‘Input Tax Credit’ when they pay GST on purchases of goods and services. They can reduce their tax liability by claiming these credits while paying tax. Example: If a business pays ₹20,000 GST on purchases and is liable to pay ₹50,000 GST for their sales, they can claim ₹20,000 as ITC, paying only the balance ₹30,000 to the government.  You cannot get these benefits if you don’t have a GSTIN.
• Access to Larger Markets: International suppliers and businesses only deal with sellers that are GST-registered. Hence, GST registration allows you to access larger markets.
• Sell Online: If you want to sell online, you need a GSTIN. Hence, voluntary GST registration can help you sell online and scale beyond the domestic market.
• Better Brand Image: Including GST on invoices makes your business appear professional and credible. Customers and associates view your business as an established one.

How to Choose the Right GST Scheme?

When you’re applying for GST registration, you will have two major schemes to choose from:

1. Regular GST Scheme

This scheme is ideal for businesses that have interstate supplies, imports, and exports, or who want to claim ITC. If you register your business under this category, then you have to file monthly or quarterly returns.

2. Composition Scheme

This scheme is ideal for small enterprises whose turnover is ₹1.5 crore or less in a year. Instead of paying GST on each invoice, you pay a fixed tax based on a percentage of turnover. You cannot sell interstate or claim ITC under this scheme.

Choosing the right scheme is very important as it will have an impact on how smoothly your tax filing process goes. If you want to scale and grow, you should apply for the regular GST scheme. However, if you want simpler and easier compliance, then go for the composition scheme.

GST Registration Documents Checklist (By Entity)

Here are all the necessary GST registration documents you must gather and provide:

1. GST Registration Documents for Sole Proprietorship

• Proprietor’s PAN card
• Aadhaar card
• Document evidencing business address (rent agreement, property documents, or electricity bill)
• Bank account details (account statement or cancelled cheque)
• Photograph of the owner

2. GST Registration Documents for Partnership Firm

• PAN of the firm
• Partnership deed
• Aadhaar and PAN of all partners
• Proof of business address
• Bank details
• Photographs of the partners

3. GST Registration Documents for Private Limited Company / LLP

• Certificate of Incorporation
• PAN of the company
• Articles of Association / LLP Agreement
• PAN and Aadhaar of the directors/partners
• Proof of principal place of business
• Bank account details
• Board resolution or authorisation letter
• Digital Signature Certificate (DSC)

It is important that these documents are accurate and updated, as even minor mismatches in details between PAN, Aadhaar, and business information can result in rejection.

How to Register for GST?

This guide explains the GST registration step by step so that you can complete the GST registration with ease:

How to Create TRN & Start REG-01

1. You must first visit the official GST portal.
2. Click on Register and then New Registration.
3. Choose “Taxpayer” from the dropdown menu.
4. Enter business details, PAN, mobile number, and email in Part A of the REG-01 form.
5. Verify your contact details with OTP you have received on your mobile number and email ID.
6. After confirmation, you will be given a 15-digit Temporary Reference Number (TRN).

The TRN is valid for 15 days only. By using it, you can log in again and continue with Part B of REG-01, which necessitates the submission of documents and business details.

Register for GST

1. Log in using your TRN and OTP
2. Open the REG-01 application form
3. Fill in business details like legal name, trade name, and district
4. Add promoter and partner details
5. Enter authorised signatory information
6. Provide the principal place of business and other details
7. Add bank account details (account number, IFSC and MICR)
8. Upload all the documents as mentioned earlier
9. Complete Aadhaar e-KYC
10. Review and submit with DSC/EVC (Digital Signature or OTP)

Get ARN (Application Reference Number)

• After submission, the system generates an ARN.
• ARN is sent to your registered mobile and email.
• Use ARN to track GST application status on the portal.

Receive GSTIN (Goods and Services Tax Identification Number)

• The application is reviewed by a GST officer.
• If documents and details are correct, the application is approved.
• You receive a 15-digit GSTIN in your email and portal account.
• Download the GST registration certificate from the portal.

Complete Aadhaar e-KYC for Faster Processing

The Indian government has started Aadhaar-based e-KYC authentication to make the approvals quicker. If you opt for Aadhar e-KYC, then here’s what will happen:

• A one-time password will be sent to the mobile number linked to your Aadhaar.
• Biometric verification might be required in certain instances.
• Once your Aadhar e-KYC is done, physical location verification will not be required.

Use the Right Signature

You need to sign the registration application digitally when you submit it. The choices are:

• Digital Signature Certificate (DSC): It is mandatory for companies and LLPs.
• E-Sign: Aadhaar OTP is used for authentication.
• EVC (Electronic Verification Code): OTP-based verification is done through a registered mobile or email.

Track with ARN

Once you’ve submitted the application process, an Application Reference Number (ARN) will be generated and sent to you via email and SMS. Using this ARN, you can check the progress of your application at any time on the GST portal under the option “Track Application Status” under the “Services” tab. You’ll usually see one of these statuses:

• Pending for Processing
• Approved
• Rejected (with reasons)

If you are required to submit more documents, you’ll be notified. However, make sure that you submit them on time to get approved and prevent rejections.

GST registration is a must-have for small business owners if they want to operate legally and seamlessly in India. The Indian government has simplified the GST registration process. However, you need to be careful when going through each step. The key benefit of a GST registration is that it not only gives you legal recognition but also improved credibility, ease of expansion, and makes you eligible to apply for a business loan.

Frequently Asked Questions (FAQs )

1. Can I apply for GST registration if my shop is on rented premises, but the rent agreement is not in my name?

Yes, but you must provide an NOC (No Objection Certificate) from the property owner along with a valid proof of address.

2. Do I need a separate GST registration for each state if I supply goods across India?

Yes, a separate GSTIN is required for every state where your business has a branch or fixed place of business. In the absence of physical presence, there is no separate GSTIN required, even if you are supplying goods and services.

3. What happens if I miss completing Part B of the GST application within 15 days of generating the TRN?

If you miss completing Part B of the GST application, then your TRN will expire, and you will need to start the registration process again.

4. Can I change from the Composition Scheme to the Regular Scheme after registering?

Yes, you can switch from the Composition Scheme to the Regular Scheme by filing the GST CMP-04 intimation form on the GST portal. This conversion is done when your turnover exceeds the Composition Scheme limits or when you want to claim ITC.

5. Is it mandatory to provide bank account details during registration?

No, it is optional at the time of registration, but you must update your bank details later through a non-core amendment before filing your returns. However, you need to change your bank details later by submitting a non-core amendment on the GST portal before submitting your returns as per Rule 10A of the CGST Rules.

6. My Aadhaar card has my old mobile number. Can I still complete Aadhaar e-KYC for GST?

No, you must first update your mobile number with Aadhaar; otherwise, the authentication will fail.

7. Can a single person be the authorised signatory for multiple GST registrations in different states?

Yes, the same individual can act as the authorised signatory for multiple GSTINs, provided they are authorised by each business entity.

8. What should I do if the GST officer asks for documents that are not listed on the portal?

As per CBIC’s instructions, officers cannot demand unnecessary documents. You can politely refer to the official guidelines and submit only the listed proofs.

9. If my GST application is rejected, can I apply again immediately?

Yes, you can reapply after correcting the errors mentioned in the rejection order. There is no cooling-off period.

10. Do I need a DSC (Digital Signature Certificate) if I am registering as a sole proprietor?

No, DSC is mandatory only for companies and LLPs. Sole proprietors can use Aadhaar OTP (e-Sign) or EVC.