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Types of GST

Types of GST in India

Last Updated 28th Jan 2021

  • 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 ₹ 40 Lakh for goods in a Financial Year. In the case of services, the threshold limit is ₹ 20 Lakh. However, compulsory registration under GST has required if the person makes inter-state supplies i.e., the threshold limit of ₹ 40 Lakh and ₹ 20 Lakh shall not apply for registration in this case.

However, the limit of ₹ 40 Lakh would be ₹ 20 Lakh for goods and limit of ₹ 20 Lakh would be ₹ 10 Lakh 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, 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?

he 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 ₹ 40 Lakh for goods, and ₹ 20 Lakh for services to register under GST. In the case of special category states the said limit is halved, i.e., ₹ 20 Lakh for goods and ₹ 10 Lakh 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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Our News - Jan 2021
  • 2021-01-01 : Deadlines extended for filing GST
    The government extended the due dates for indirect tax compliance, the government has extended the date for filing annual returns under GST for the financial year 2019-20 to February 28 from the previous deadline of December 31.
  • 2020-12-02 : GST collections for November top ₹1 trillion
    GST revenue scaled ₹1 trillion for the second consecutive month in November, after a sharp decline in the initial months due to the pandemic and the subsequent nationwide lockdown. The government notified that GST collections increased by 1.4% on a year-on-year basis. Out of the ₹1.05 trillion revenue collected, central GST was ₹19,189 crore, state GST was ₹ 25,540 crore, IGST ₹ 51,992 crores and cess ₹8,242 crores.
  • 2020-11-24 : GST registration for an overhaul
    The GST Council law committee has made its recommendations on both new registrations and the removal of current risky taxpayers likely to be interested in the fraud. Comprehensive amendments to the registration procedure for new applicants will soon be considered by the GST Council, which will make the process rigorous for those not opting for Aadhaar-based authentication. The new rules seek to curtail fly-by-night operators that use bogus invoices to take advantage of input tax credits.
  • 2020-11-23 : GST Council advises Aadhaar-like registration for False invoice issue
    The GST Council has recommended that the registration process be tightened to root out all issuing bogus invoices from knowledgeable sources. The committee recommended the implementation of an Aadhaar-like registration process under the GST regime for new applicants. Under this after record authentication, a new registration can be done digitally with live photographs and biometrics.
  • 2020-11-18 : Compulsory GST e-invoicing from Jan 1, 2021, if turnover crosses ₹ 100 Cr
    The Central Board of Indirect Taxes and Customs declared that GST e-invoicing would be mandatory as of Jan 1, 2021, for any business whose revenue exceeds ₹100 Cr. A turnover of ₹ 500 crore was the cap set earlier. In the field of e-invoicing, the reforms would affect a significant number of medium-sized firms. From Apr 1 2021, it is planned to be made available to all taxpayers for B2B transactions.
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