GST Registration Limit: Minimum Turnover Limit for GST

What is the Minimum Turnover Limit for GST Registration?

Businesses are required to register for GST and pay tax on their annual turnover if their annual revenue exceeds Rs.40 lakhs in the case of goods supplied and Rs.20 lakhs for the supply of services. Although it is not mandatory for businesses with a turnover less than the specified threshold to register for GST, they can still choose to register themselves voluntarily, as it can help them claim their input tax credits and other benefits.

However, there are some exceptions to this threshold. Here is a table that provides a clear overview of the GST registration threshold and registration status.

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Classification of States for the Applicability of New GST Turnover Limits

Given below is the classification of states for the applicability of new GST turnover limits -

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Who are Compulsorily Required to Register for GST?

Given below is a list of category of taxpayers who are compulsorily required to register under GST -

• Casual taxable persons
• Non-resident taxable persons
• Interstate suppliers
• Persons required to deduct TDS/TCS
• Persons taxable under the reverse charge basis
• Input service distributors
• E-commerce companies offering suppliers a platform to produce supplies.
• Providers delivering items via online retailers are responsible for withholding taxes at the source
• Individuals acting as Agents or Principals in a transaction on behalf of another person.
• Internet service providers offering services to unregistered individuals in India from overseas.

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How to Calculate GST Threshold Limit?

GST threshold refers to the minimum annual turnover that your business must have during a year for GST -

Some factors that need to be considered to calculate the annual threshold are -

• Annual Turnover - Determine the total value of goods or services offered by you in a financial year, including both taxable and non-taxable supplies.
• Aggregate Turnover - This should include the sum of turnover of all business entities with the same PAN. If the overall turnover exceeds the minimum threshold for GST registration, considering the type of supply and the state category, then the entity has to register itself under GST.
• Export Earnings - It refers to the revenue generated from international sales. These earnings need to be converted into local currencies for accounts and tax purposes.
• Interstate Supplies - This refers to the sale of goods and services to another state in India and the IGST rates applicable to it.

If your annual business turnover exceeds the minimum threshold, make sure you get yourself registered under GST to avoid legal consequences. Even if you are not mandatorily required to register for GST, you can still register for GST voluntarily to claim your input tax credit and avoid penalty and late fees.

Need help with GST registration? Contact our tax experts now!

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