Traders with annual turnover less than Rs 20 lakh are exempt from GST registration, is a well known fact among MSMEs. However the lesser known fact is that small businesses indulged in inter-state movement of supplies come under the mandate of registration irrespective of their turnover, clarified Revenue Secretary Hasmukh Adhia in a special GST MasterClass.
According to Adhia, if a small businessman wants to do business from his state to another, then it is mandatory to register under GST, even if his annual turnover is less than Rs 20 lakh. The exemption for registration is only for small traders who stick to business within their particular state.
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He further added that traders with annual turnover of less than Rs 20 lakh and supplying goods and services within a specific state, if willing to avail the input tax credit, can voluntarily register under GST. Though, once registered, all the supplies will be taxable despite the lesser business revenue.
The Revenue Secretary also clarified that small businessmen will have to file returns after registration, even if there is no transaction in any month. Also, once an exempted small business crosses the threshold limit over time, registration should be done within 30 days of it.
Adhia was addressing the first GST MasterClass, an initiative of the government for addressing concerns and queries of stakeholders as well as citizens. The classes are 4 hour-long programmes which will be conducted for 6 days in a row.