In a previous blog, we went over the basics of GST registration. If you want to understand the preliminary process of registering under GST, we suggest you take a look at that blog first and then circle back to this one. Today, we are discussing about the special cases for GST registration, including exemptions for GST Registration and also special provisions under GST law.

GST Exemptions

Typically, the mandatory condition for GST  registration was based on the aggregate turnover of a company. If the aggregate turnover is above INR 40 lakhs, then the company has to compulsorily register under GST.  However, certain individuals and scenarios allow for an exemption in GST registration.

The following taxpayers are exempted from GST registration:

Agriculturists

By technical definition under GST, an agriculturist is any person who supplies products from of his cultivation land. Moreover, agro-inputs like fertilizers, seeds, irrigation (electric), machinery and allied agricultural services also enjoy GST Exemptions.

Persons falling in Threshold Exemption Limit

As we discussed, anyone with an aggregate turnover < INR 40 lakhs fall below the threshold of GST registration and so they are given GST Exemption. For some states (Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh and Uttarakhand), the limit is < INR 20 lakhs.

Persons making Nil-Rated/ Exempt supplies of goods and services

Those individuals who are engaged in the supply of common items are exempted from GST registration. The list of items which fall within this category are:

1. Unprocessed food items
2. Train travel by local and sleeper classes
3. Education
4. Healthcare (except medicines)
5. Hotels, lodges with rent charges less than Rs 1,000
6. Kid’s colouring /drawing books
7. Bindis, sindoor, bangles, etc

Persons making Non-Taxable/ Non-GST supplies of goods and services

Certain goods and services are excused under the GST regime. Persons involved in the supply / provision of these services need not register under GST. Such non-taxable goods and services include:

1. Crude petroleum and petrol
2. High speed disel
3. Natural gas
4. Electricity
5. Alcohol (which humans consume)
6. Aviation turbine fuel

Activities that are neither Supply of Goods nor Services

GST is only levied on the supply of goods / services. By technical definition of these terms under GST law, certain activities are not considered as a supply. The following services and activities are exempted from GST registration:

1. Services rendered by an employee of a company
2. Services provided by any Court or Tribunal
3. Functions and duties of legislative individuals like MPs, MLAs, Panchayat members, municipalties, constitutional post holders, chairpersons, and directors in a authoritative body
4. Funeral service providers
5. Sale of land and buildings
6. Actionable claims (except lottery, betting, and gambling)

Persons making only supplies covered under reverse charge

The Central Government decreed through Notification No. 5/2017 on the 19^th of June 2016 that any person who is engaged in making supplies of taxable goods or services for which the total tax is liable to be paid on a reverse charge basis by the recipient is exempted from GST registration.

Special provisions under GST

Section 24 of the GST Act makes certain special provisions for casual taxable person and non-resident taxable person.

By definition, a casual taxable person  is a person without a fixed place of business, who occasionally engages in taxable value additions in a taxable terriroty.

On the other hand, a Non-resident taxable person is any person who occasionally undertakes transactions involving supply of goods or services or both, whether as principal or agent or in any other capacity, but has no fixed place of business or residence in India.

So, what is the special provision for such individuals?

A casual taxable person or a non-resident taxable person shall apply for GST registration at least 5 days prior to the commencement of business. They may obtain a temporary GST registration for 90 days (extendable for additional 90 days).

If you need any sort of assistance with GST registration or need clarification whether you fall under the exemption rule, reach out to us.