Persons liable to be Registered under Revised Model Draft GST Law

Goods and Services Tax (GST) is a comprehensive tax system that is levied on goods and services at each stage of the supply chain. The GST was introduced in India on July 1, 2017, replacing multiple indirect taxes such as excise duty, service tax, and Value Added Tax (VAT).

The Revised Model Draft GST Law has brought significant changes to the registration process of GST. In this article, we will discuss the persons liable to be registered under the Revised Model Draft GST Law.

Threshold limit for registration

The threshold limit for registration varies based on the nature of the business. The following are the limits:

₹40 lakhs for businesses operating in all states of India except the northeastern states and Himachal Pradesh.
₹20 lakhs for businesses operating in the northeastern states of India and Himachal Pradesh.

Persons liable to be registered under GST

The following are the persons who are liable to be registered under the Revised Model Draft GST Law:

Persons making intra-state taxable supplies

Any person who is making taxable supplies of goods or services within a state and whose turnover exceeds the threshold limit is liable to register for GST. This includes small businesses such as kirana stores and cafes, and larger businesses such as manufacturers and service providers.

Persons making inter-state taxable supplies

Any person who is making taxable supplies of goods or services from one state to another and whose turnover exceeds the threshold limit is liable to register for GST. This includes e-commerce businesses and service providers who are operating in multiple states.

Casual taxable persons

A casual taxable person is a person who occasionally undertakes taxable transactions without having a fixed place of business. Any person who falls under this category is liable to be registered for GST irrespective of the threshold limit. This includes exhibitors at trade fairs and events.

Non-resident taxable persons

A non-resident taxable person is a person who occasionally undertakes taxable transactions in India and does not have a fixed place of business in India. Any person who falls under this category is liable to be registered for GST irrespective of the threshold limit.

Persons paying tax under reverse charge mechanism

Any person who is required to pay tax under the reverse charge mechanism is liable to be registered for GST irrespective of the threshold limit. This includes businesses that purchase goods or services from unregistered dealers or importers.

E-commerce operators

E-commerce operators who are responsible for collecting tax on behalf of the suppliers are liable to register for GST irrespective of the threshold limit.

Input service distributors

Input service distributors are persons who receive invoices for input services and distribute the input credit to their branches. These persons are liable to be registered for GST irrespective of the threshold limit.

Conclusion

The Revised Model Draft GST Law has brought significant changes to the registration process of GST. It is essential to be aware of the persons liable to be registered under the law to avoid any non-compliance issues. Small and medium businesses need to keep a check on their turnover and ensure timely registration under GST to avoid any penalties.