GST registration is mandatory for professionals in India if their aggregate annual turnover exceeds ₹20 lakh (or ₹10 lakh for special category states). While generally not required below these thresholds, registration is compulsory regardless of turnover for those providing interstate services or, in certain cases, working with unregistered online platforms, as noted by TaxAdda.
For Goods Suppliers: Businesses involved in the supply of goods must register for GST if their annual turnover exceeds Rs. 40 lakhs. For Service Providers: For those providing services, the registration threshold is Rs. 20 lakhs in annual turnover.
GST Applicability of Professional Services in India
GST is applicable to virtually all professional services offered in India. GST applies to all the following services: Legal and compliance services. Accounting, auditing, and tax-related services.
Indian freelancers must pay GST when their turnover exceeds INR 20 lakhs/INR 10 lakhs in special category states) in a financial year. If a freelancer who doesn't exceed the specified turnover voluntarily registers under GST, they are also obligated to pay and collect GST and file returns on time.
GST/HST obligations
Generally, if you earn more than $30,000 over four calendar quarters by supplying taxable goods or services, you have to register for, collect, and remit (send) the related goods and services tax / harmonized sales tax (GST/HST) to the Canada Revenue Agency.
If your GST turnover is below the $75,000 threshold, you may choose to register. But if you do, regardless of your turnover, you must: include GST in the price of most goods and services you sell. claim GST credits for most business purchases you make.
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.
Do I Need To Charge GST? If your annual income (before expenses) is less than $30,000 you are considered a small supplier, and will not need to charge. As soon as your income exceeds this, you will need to charge. For this reason, it is helpful to have a GST number registered.
A: Yes, GST registration becomes mandatory if your turnover exceeds ₹20 lakhs (₹10 lakhs in special category states) under Section 22 of the CGST Act, 2017. However, you may voluntarily register even below this threshold to claim Input Tax Credit (ITC) or if clients insist on a GST invoice.
GST registration is mandatory for all eCommerce Sellers Citizen can apply for New GST by Registrating online without Visiting the Govt. office.
If you don't register for GST and are required to, you may have to pay GST on sales made since the date you were required to register. This could happen even if you didn't include GST in the price of those sales. You may also have to pay penalties and interest.
You're considered a small supplier as long as your gross revenue remains less than $30,000 over any 4 consecutive calendar quarters. This means you're not required to register for GST/HST.
If you make $75,000 or more in business income, you're required to register for and charge GST (we'll cover this in a sec). This means that you charge an additional 10% on top of your regular fees, which you record and pay to the government when you lodge your next Business Activity Statement (BAS).
GST Applicability on Service Industry
Even if you make less than $30,000 in income in subsequent years after charging GST/HST, you must continue to charge GST/HST on your invoices to clients and remit payments to the CRA.
For professionals, this means charging GST on taxable supplies, lodging Business Activity Statements (BAS), and claiming GST credits on business-related purchases. Generally, if your business has a GST turnover of $75,000 or more annually, you are required to register for GST.
Example: Healthcare services, educational services, and public utility services (e.g., water supply) are exempt from GST. This exemption is unconditional, meaning the supply is fully exempt from GST without any terms or conditions attached.
Registration under GST is a legal requirement for businesses. The CGST Act 2017 specifies minimum turnover criteria for registration (Rs 40 lakhs for goods and Rs 20 lakhs for services). Still, certain specific businesses are required to register under the GST, irrespective of their annual turnover.
Businesses with annual sales of Rs. 40 lakhs or more for goods, and Rs. 20 lakhs or more for services, must register for GST. If the turnover exceeds the allowed threshold, there is a penalty for failing to register under GST.
Under sub-section 44ADA, professionals are allowed to claim deductions if the annual turnover is below the set limit of Rs. 50 lakh (Rs. 75 lakh if 95% of the total receipts are through online modes).
If the ATO discovers you've been charging GST without being registered, you could face: Refunding GST to Customers: You'll need to pay back the GST you've charged, even if you've already spent it. Financial Penalties: The ATO may hit you with fines, interest charges, and audits.
In conclusion, the minimum GST registration limit for mandatory GST registration in India is Rs. 40 lakh for most businesses, with a lower threshold limit for GST registration of Rs. 10 lakh applicable in special category states.
You have to start charging the GST/HST on your date of registration, including on the sale that made you exceed the $30,000 threshold.