When must a small business take GST registration?
A small business takes GST registration when its aggregate turnover crosses the section 22 threshold, or when section 24 makes a GSTIN compulsory even below that line. The application and the certificate are on the GST registration page.
What turnover forces registration?
Aggregate turnover counts taxable supplies, exempt supplies, and exports, for one PAN, across India. The structure of the business does not change the figure.
- Goods: ₹40 lakh in most states, and ₹20 lakh in special category states.
- Services: ₹20 lakh, or ₹10 lakh in special category states.
- A person who supplies both goods and services stays on the service threshold.
Ice cream, pan masala, and tobacco do not get the higher goods threshold. A proprietorship uses the same lines; the papers that differ are on the proprietorship GST page.
Who must register below that turnover?
Section 24 does not wait for the threshold. The usual cases are these.
- Inter-state supply of goods. Inter-state supply of services stays optional while turnover is under section 22.
- A casual taxable person, and a non-resident taxable person.
- A person required to pay tax under reverse charge.
- An e-commerce operator required to collect tax at source, and an input service distributor.
Anyone else may still register under section 25(3). That choice is voluntary. It is not a way to skip the return once the GSTIN exists.
What starts once the GSTIN is issued?
The certificate is GST REG-06. From then the business quotes the GSTIN on tax invoices, files the returns on the GST return page, and keeps the records those returns are checked against. A month with no supply is still a month that needs a nil return.
A business under the composition turnover may opt for the composition scheme instead of the regular pair of returns. The scheme is a choice at registration or before the next financial year. It is not the default.
Frequently asked questions
Four questions cover who must register, the two thresholds, and voluntary registration.
Is every small business required to register?
No. A supplier under the section 22 threshold, who is not in a section 24 case, need not register. Voluntary registration is still open.
Do goods and services share one limit?
No. Goods are ₹40 lakh in most states and ₹20 lakh in special category states. Services are ₹20 lakh, or ₹10 lakh in special category states. A person who supplies both stays on the service threshold.
Does the business structure change the limit?
No. A proprietorship, a partnership, an LLP, and a company are tested on the same turnover. Aggregate turnover is computed for one PAN, across India.
Can a business register before the limit?
Yes. Section 25(3) allows voluntary registration. From the date of registration the person issues tax invoices and files returns, including a nil return.
Sources
The threshold is section 22 of the CGST Act. Compulsory registration below that line is section 24.