What is One Person Company (OPC)?
What is GST Registration?
GST refers to Goods and Services Tax which subsumes all taxes such as Sales tax, Service tax, Excise duty etc. into GST. GST registration is required primarily if your annual sales are more than Rs. 20 Lakh. Even if your sales are less than Rs. 20 Lakh, we suggest that you voluntarily opt for GST registration because:
- You will not get any tax refunds on purchases (e.g. if you buy goods worth Rs 1 lakh in a year, and tax rate is 28% – you will lose tax refund of Rs. 28,000)
- You cannot sell outside your state
GST registration typically takes between 2-6 working days. You need to file your application with the department and sign it with your digital signature.
What are the Minimum Requirements of One Person Company Registration?
- Minimum 1 Shareholder
- Minimum 1 Directors
- The directors and shareholders can be same person
- Minimum 1 Nominee
- Only Indian residents can be Shareholder & Nominee
- Minimum 1 Director must be Indian Resident
- Minimum Authorized Share Capital to be Rs. 1 Lac
- DIN (Director Identification Number) for all Directors
- DSC (Digital Signature Certificate) for 1 Promoters & 1 witness
Who all need GST Registration?
The registration in GST is PAN based and State specific. Supplier has to register in each such State or Union territory from where he effects supply if he fulfills any of the following conditions:
- Having an annual aggregate turnover from all-India operations which is above the threshold limit of Rs. 20 Lakhs (Rs. 10 Lakhs for North-Eastern States)
- Currently registered under any of the earlier indirect tax regimes (VAT, Excise Laws, Service Tax Laws) irrespective of the threshold limit
- Having branches in multiple states or multiple business verticals in one state
- Making any supply to other states
- Required to pay tax under Reverse Charge (In case your supplier is not registered under GST)
- Required to deduct tax at source or an Input Service Distributor
- Agents of a supplier
- Supplying goods or services through E-commerce Operator
- E-commerce Operator / Aggregator who supplies goods or services under his brand name (e.g. Flipkart, Amazon, Ola)
- Supplying online information and database access or retrieval services from a place outside India to a person in India, other than a registered taxable person
Benefits of Registration under GST
GST Registration will give the following advantages to a taxpayer
- He is authorized to collect taxes from his customers and pass on the credit of the taxes paid to them.
- He can claim Input Tax Credit of taxes paid to his suppliers and can utilize the same for payment of taxes due.
- Seamless flow of Input Tax Credit from suppliers to recipients at the national level.
Documents for GST Registration
- PAN Card of owner/ directors/ partners
- Bill of Electricity/ Telephone, Rent Agreement or Letter of Consent (NOC)
- MOA/ AOA or Partnership Deed
- Letter of Authorisation for signatory
- Bank statement/ Cancelled Cheque
- Aadhaar Card of owners/ directors/ partners
Exemption & Remedies under GST
There are basically two types of exemption and remedies available to the taxpayer, one is basic exemption and another is the composition scheme. Let us understand both:
- BASIC EXEMPTION UNDER GST
As per the GST law, if any person supplies goods or services for the value of more than Rs.20 lakh, then GST registration shall be mandatory and he shall have to apply for GST registration within 30 days.
- COMPOSITION SCHEME (LEVY) UNDER GST
To avail the composition scheme, one must apply to the department only if the total turnover is less than 50 lakh. Further, that person should not sell outside the state. The composition rate may be 2.5% in case of manufacturer and 1% in case of others.