Types of GST

Last Updated 26th May 2020

Types of GST in India

  • CGST is Central Goods and Service Tax
  • SGST is State Goods and Service Tax
  • IGST is Integrated Goods and Services Tax
  • These three types of GST are levied based on the aspect of inter-state and intra-state transactions.
  • While CGST and SGST are levied on Intra-state transactions, IGST is levied on Inter-state transactions.

Comparison Between CGST, IGST, SGST / UTGST

India has adopted a Dual GST Model under which tax is levied simultaneously by both Central and State government on taxable supplies which takes place within State or Union Territory. On inter-state supplies, GST is levied by the Central Government, while in case of intrastate transactions the tax is distributed equally between central and state government under CGST and SGST.

Integrated GST - IGST

Central GST - CGST

State/Union Territory GST - SGST/UTGST

Tax Levied By Central Government, on Inter-State supplies of Goods and/or services Central Government, on Intra-State supplies of Goods and/or services State/Union Territory Government, on Intra-State supplies of Goods and/or services
Taxes that it will replace Central sales tax (CST) Service tax, excise duty, countervailing duty (CVD), special additional duty (SAD), Additional duties of excise(ADE), and any other indirect central levy VAT, sales tax, luxury tax, entry tax ,entertainment tax, purchase tax, Octroi, taxes on lottery
Applicability Interstate supplies and import Supplies within a state Supplies within a state
Input Tax Credit Against CGST, SGST and IGST Against CGST and IGST Against SGST/UTGST and IGST
Tax Revenue Sharing Shared between state and central governments Central government State/ union territory government
Free Supplies IGST is applicable on free supplies CGST is applicable on free supplies SGST and UTGST is applicable on free supplies

Registration Under GST

Every supplier of goods or services is required to obtain registration in the State and Union Territory from where he makes a taxable supply if his aggregate turnover exceeds Rs. 40 lakhs for goods in a Financial Year. In the case of services, the threshold limit is Rs. 20 lakhs. However, compulsory registration under GST has required if the person makes inter-state supplies i.e., the threshold limit of Rs. 40 lakhs and Rs. 20 lakhs shall not apply for registration in this case.

However, the limit of Rs. 40 lakhs would be 20 lakhs for goods and limit of Rs. 20 lakhs would be Rs. 10 lakhs for services in case of the Special Category States i.e., Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh, and Uttarakhand.

The step by step procedure for registration under GST are as follows:

  • Visit the GST portal (https://www.gst.gov.in/), and click on the ‘Register Now’ option under the option ‘Taxpayers (Normal/TDS/TCS).’
  • After clicking, a form will open in your window. You are now required to fill the following details:
    • Select the ‘New registration’ at the top; it needs to have a green color highlighted on the circle.
    • In the next drop-down menu select, I am a - Taxpayer.
    • Now select the state and district from the next drop-down menu.
    • The next step is to mention the registered ‘Name of the Business’ and the ‘PAN of Business.’
    • Now mention your email address and mobile number.
    • Follow it up by clicking on ‘Proceed.’ An OTP will be sent on both your email and mobile number.
  • Now you need to enter the OTP received on your email and mobile number separately. In case you did not receive the OTP, then click on Resend OTP.
  • The next window will show that you have received a Temporary Reference Number (TRN), which is sent to your email and mobile number as well.
  • Now you need to revisit the GST portal and choose ‘Register Now.’
  • This time select the Temporary Reference Number (TRN). Then enter the TRN along with captcha and follow it up by clicking on ‘Proceed’.
  • Now enter the OTP you received on your email and mobile number.
  • After the above steps, the next window will display your status of the application as a draft. Click on the ‘Edit’ icon.
  • Now, you will see another form that has 10 sections. Fill the required details and attach the following documents:
    • Photo of Taxpayer/Promoters
    • Constitution of Taxpayer
    • Details of Bank account
    • Authorization form
    • Proof for the place of business
  • After filling all the details and attaching the necessary documents, tick the deceleration, and submit the application in any of the following ways:
    • For companies, the application must be submitted using DSC.
    • If you opt for E-sign, OTP will be sent to your number that is registered with Aadhaar.
    • If you opt for EVC, OTP will be sent to your registered mobile number.
  • After completing the above steps, the next window will display the success message along with the Application Reference Number (ARN), which is also sent to your registered email and mobile number.

FAQs

What are the 4 types of GST?

The three types of GST in India are; Central Goods and Service Tax (CGST), State Goods and Services Tax (SGST), Union Territory Goods and Services Tax (UTGST), and Integrated Goods and Services Tax (IGST).

What is the time limit for taking registration under GST law?

It is compulsory for organizations with turnover of Rs. 40 lakhs for goods, and Rs. 20 lakhs for services to register under GST. In the case of special category states the said limit is halved, i.e., Rs. 20 lakhs for goods and Rs. 10 lakhs for services.

Can I charge GST before registration?

No, only the registered taxable person can charge and collect GST. Besides the GST amount charged needs to be indicated appropriately in the invoice.

Is there any time limit for registering in GST?

Yes, you need to apply for GST registration within 30 days from the date on which you became liable for registration. However, a casual taxable person and a Non-resident is required to get GST registration at least 5 days before the commencement of business.

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