What is Voluntary Registration under GST?

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Sakshi Shah

Aggregate Turnover
GST Portal
GST Registration
GSTIN
Last updated on March 16th, 2023

Voluntary Registration means applying for registration under GST (Goods and Service Tax) on a voluntary basis. The taxpayers who are not required to register as per the GST Act can apply for voluntary registration under GST.

GST Registration is allotment of a unique GST Number or GSTIN i.e. GST Identification Number to a business by the GST Department. The business registered under GST should:

A business will be required to register under GST if:

Thus, a dealer whose aggregate turnover is less than the prescribed threshold limit does not need to register under GST. Such dealers can apply for voluntary registration under GST. The taxpayer may apply for voluntary registration under GST to avail of the benefits available to GST registered dealers.

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Who should opt for Voluntary Registration under GST?

Whether a dealer should apply for a GST registration or not depends on various factors. Check when should you apply for registration.

Apply for voluntary registration under GST for following reasons

  1. Claim ITC on purchases – If you are registered under GST, you can claim the input tax credit of the GST paid on your purchases. You can claim GST input tax credit if you are registered under GST.
  2. Status of the registered dealer – If you are a GST registered dealer, you will receive a certificate of registration that will act as a valid proof of the legal status of the business.
  3. Competitive Advantage – Larger organizations and MNCs prefer to work with the GST registered dealers. A GST registered dealer can work with such companies to gain a competitive advantage.
  4. Inter-state sales – If you plan to sell goods or services outside your state in the future, you can apply for voluntary registration. By voluntary registration, you can avoid compulsory GST registration in the future.
  5. E-Commerce sales – If you plan to sell goods or services on an e-commerce platform, you can apply for voluntary GST registration to avoid compulsory registration under GST in the future.
  6. Unutilised ITC of earlier taxes – Dealer who has unutilised input tax credit under service tax, VAT, etc can carry forward this credit. This credit can be used for payment of taxes after registering under GST.

Do not apply for voluntary registration under GST for following reasons

  1. Sales to unregistered dealers – If your customers are not registered under GST, they cannot claim the credit of GST paid on the purchase. Thus, it would be beneficial to not charge GST from them. In that case, do not apply for registration.
  2. Purchases from unregistered dealers – If you purchase goods and services from unregistered dealers, you do not pay GST on purchases. Thus, you do not have any input tax credit to claim and registration may not be taken.
  3. GST Compliances – Once you’re registered under GST, it is compulsory to follow the provisions of the GST Act. To avoid complicated compliances like filing returns, payment of tax, maintenance of accounts, etc, registration should not be taken.
I am registered under service tax but my turnover is below 20 lacs. Should I register under GST?
You should register under GST if you wish to claim the credit of taxes paid on purchases or plan to sell your product online on an e-commerce platform
Read Answer
I am registered under service tax but my turnover is below 20 lacs. Should I register under GST?
You should register under GST if you wish to claim the credit of taxes paid on purchases or plan to sell your product online on an e-commerce platform
Read Answer

FAQs

What is Voluntary Registration?

Voluntary Registration means applying for registration under GST (Goods and Service Tax) on a voluntary basis. The dealers who are not required to register as per the GST Act can apply for voluntary registration on GST Portal.

Why should you apply for Voluntary GST registration?

The following can be the reasons for a business to apply for Voluntary GST:
1. Claim ITC on purchases
2. Status of the registered dealer
3. Competitive Advantage
4. Inter-state sales
5. E-Commerce sales
6. Unutilized ITC of earlier taxes

What is the GST Registration process?

Mentioned below is a brief process for GST Registration on the GST Portal:

1. Under New Registration on GST Portal, enter the basic details
2. You will see a GSTIN/ UIN / Provisional ID
3. Verify using OTP (One-time Password)
4. You will receive a TRN (Temporary Registration Number)
5. Verify the TRN by OTP Verification
6. Enter the relevant details and Upload the documents
7. Verify your application
8. Submit

Got Questions? Ask Away!

  1. Hey @HarshitShah

    GST Registration is the application for GST Number or GSTIN(GST Identification Number). Under the GST(Goods and Service Tax) Regime, it is mandatory for to have GSTIN to collect, pay GST and claim the Input Tax credit.

    For GST registration, the dealer has the following options:

    • Compulsory Registration: Under certain scenarios, the businesses have to get registration under GST

    When is Compulsory GST Registration needed?

    • Voluntary Registration: The business does not have the liability to register under GST, however, can apply for GST Registration. This usually is when the businesses are willing to take advantage of the Input Tax Credit facility

    • Registration under Composition Scheme: Composition scheme is a voluntary and optional scheme for registering under GST. Under the composition scheme, the compliance is simpler and lesser returns are to be filed. The tax is to be filed at a fixed rate. If the business turnover is in between INR 40 Lakhs and 1.5 Crores, they can opt for GST Registration under Composition Scheme

    • No Registration: In the case, when your business does not fall under the conditions for compulsory registration you do not require GST Registration

    Read more on GST Registration Types.

    Hope this helps!

  2. What documents do I need for a new GST number?

  3. Hey @SonalYadav

    To get a GST Number or GSTIN in India, you will be required to Register under GST(Goods and Service Tax)

    Usually, you receive the GST Number within 4–7 days of GST Registration application is submitted.

    Follow these steps to register under GST on GST Portal:[1]

    PART A of the GST Registration Application

    • Go to GST portal
    • Navigate to Services > Registration > New Registration
    • Click on ‘New Registration’ and enter the details

    • You will be displayed with a Provisional ID/GSTIN / UIN for the same PAN. Click on Proceed
    • An OTP (One Time Password) is generated and sent on registered the Mobile number and Email ID. The OTP is valid for 10 mins. You can generate the OTP again in case the time exceeds 10 mins, or the OTP you entered is invalid.
      • You are required to enter both the OTPs received on the mobile number and email id.
    • A TRN (Temporary Reference Number) will be displayed. The same TRN will be sent on your email id and mobile number.
      • You now have a 15 days window to complete and submit your GST Application using the TRN.

    Now let’s start with the PART B of the GST Application

    • Navigate to Services > Registration > New Registration
    • Log in using the TRN
      • Interpret and Enter the CAPTCHA code
      • Verify using OTP. The same OTP is sent on email id and mobile number.
    • Go to ‘My saved application’ page. Click on ‘edit icon’ under actions to continue filling in the application.

    The PART B of GST Application has various tabs. You will be required to enter the relevant details and upload relevant documents.

    • The First Tab is ‘Business Details’. If you want to apply for composition scheme under GST- select ‘Yes’ in the option for composition field. Click on save and continue after you fill in the details and upload the relevant documents.

    Read More: Should I register under Composition Scheme?

    • The second tab is ‘Promoters / Partners’. Here enter personal information, identity & address details, also upload relevant proofs for the same.
    • For ‘Authorized Signatory’ will be auto-filled if the authorized signatory in the earlier tab was selected.
    • Next, add ‘Authorized Representative’ if you have a different authorized person for GST. In most cases, details in this tab are not required.
    • The fifth tab is ‘Principal Place of Business’. Principal place of business is where the headquarters are located and books of accounts are maintained. Apart from the details, you will be required to upload the legal ownership document.
      • Add additional place of business (if any).
    • The sixth tab is for ‘Goods and Service’. Add the details of goods and services supplied by the business. You can enter up to a maximum of 5 goods and 5 services.
    • Next enter ‘Bank Account Details’. Sometimes bank account details are not asked during the GST Registration.
      • In such cases, bank account details should be added after GST registration is successful. The following message will be displayed when you log in into your GST account.
      • Now, you can add bank account details after ‘Amendment of Registration Non-Core fields’.

    • The Authorized Signatory can add bank details and upload the relevant proof. They will be required to verify the proof by e-verification or DSC.

    • In the eighth tab enter ‘State Specific Information’
    • Finally, the last tab is for ‘Verification’. It can be done by
      • Submitting with DSC: DSC is for Digital Signature. You will be required to register the DSC on GST Portal. Sign the application using DSC token.
      • Submitting with EVC or e-Signature: For this option, you will receive an OTP, enter this OTP and submit the application.
    • After the successful submission of GST Registration application, you will receive an ARN (Acknowledgment Reference Number). Use this ARN to track your GST Application.

    Use Track GST Application by ARN tool

    Usually, GST Number or GSTIN is allocated within 4–7 days from submitting the GST registration application.

    Get GST Registration using Quicko.

    Hope this helps!

    Footnotes

    [1] GST Registration Process online on GST Portal: Guide | Help Center | Quicko

  4. Hey @Shweta_Saini

    You can opt out of Composition Scheme from your account on GST Portal. Once the taxpayer type is updated to Regular in your profile, you can start filing GST Returns under the regular scheme. If you are facing any issues while making the withdrawal application, you can create a grievance on the GST Portal.

    Do let us know if you have any further queries.

  5. I want to be able to claim input tax credit for GST paid. Should I opt for the GST composition scheme or regular scheme?

  6. Hey @Joe_Fernandes

    If you wish you claim Input tax credit, you should opt for GST Regular Scheme.

    Read more about the difference here.

  7. 1.composite scheme dealer inward supplies detailes(purchases invoices ) uploaded manadatory show in gstr4 annual return.
    2.composite dealer late fees and interest calculate procedure.

  8. Hi @Sundaraiah_Kollipara,

    As per Rule 62(3)(a) of CSGT Rules, 2017 (Part A_Rules) A composition taxpayer has to furnish

    • Invoice-wise details of inward supplies relating to both intra-state & interstate from registered and unregistered persons separately.

    As per the instructions given below FORM GSTR-4 of CGST Rules, 2017 (Part B_Forms), the following information relating to inward supplies (rate-wise) needs to be provided

    • Table 4A – Information will auto-populate relating to inward supplies from a registered supplier other than supplies where the reverse charge is applicable from the returns furnished by the suppliers in GSTR-1 and GSTR-5.
    • Table 4B – Information will auto-populate relating to supplies from a registered supplier where the reverse charge is attracted from the returns furnished by the suppliers in GSTR-1.
    • Table 4C – Information will auto-populate relating to inward supplies from an unregistered supplier.
    • Table 4D – Information relating to the import of services.

    But as per clarification by GST department, when the auto-population feature for inward supplies which was available on the GST portal was not working. Reporting in table 4A of GSTR-4 is not mandatory.

    Further, late fee of Rs. 200 per day is levied if the GSTR-4 is not filed within the due date. The maximum late fee that can be charged cannot exceed Rs. 5,000. Interest is also calculated at rate of 18% p.a on tax liability.

    You can read our below articles for more insights:

  9. A retail pharmacy store dealer composite scheme registered in gst act recently.dealer purchase of medicines different tax rates(1 ,12,18 percent)and sale to counter sales through on Google pay and phone pay online mode and cash mode sales two types amounts received.my doubt: dealer how to accounting entry passed procedure in books

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