GST FAQs: Is Registration Must For Dealing With Tax Exempt Supplies?

GST FAQs picThe CBEC (Central Board of Excise and Customs)  shed light on a variety of topics including GST registration, the nil tax slab, inter-state supply, turnover, voluntary registration, and cess.

With the launch of the much-awaited GST or goods and services tax around the corner, various government departments are working towards a smooth transition to the new indirect tax regime.

The Central Board of Direct Taxes, under the purview of the Department of Revenue, has answered a set of frequently asked questions (FAQs) pertaining to different situations under GST. Touted as the biggest tax reform since Independence in 1947, GST is set for a midnight launch on June 30.

Here are some of the questions addressed by the CBEC:

Q1. Whether civil contractor doing projects in various states requires separate registration for all states or a single registration at the state of head office will suffice?

Answer 1: A supplier of service will have to register the location from where he or she is supplying services.

Q2. If there are two SEZ (Special Economic Zone) units within the same state, whether two registrations are required to be obtained?

Answer 2: SEZs under the same PAN in a state require one registration. The CBEC has advised reference to Rule 8(1) of Central Goods and Services Tax Rules, 2017 for more details.

Q3. When is registration in another state required? Will give service from Nashik to another state require registration in the other state?

Answer 3. If services are being provided from Nashik, then registration is required to be taken only in Nashik and IGST is to be paid on inter-state supplies.

Q4. I have migrated under GST but want to register as ISD (Input Service Distributor). Can I apply now? What is the procedure?

Answer 4: A separate and new registration is required for ISD.

Q5. Does rental income up to Rs. 20 lakh attract GST or any other charge?

Answer 5: GST is leviable only if aggregate turnover is more than Rs. 20 lakh (Rs. 10 lakh in 11 special category states). For computing aggregate supplies, the turnover of all supplies made by you would be added.

Q6. If someone trades on zero percent GST items (grains, pulses, etc.), is it necessary to register for GST, if the turnover exceeds Rs? 20 lakh?

Answer 6: A person dealing with 100 percent exempted supply is not liable to register irrespective of turnover.

Q7. Is it correct that a person dealing exclusively in NIL-rated or exempt goods/services is liable to register if the turnover exceeds Rs? 20 lakh or Rs. 10 lakh in some states?

Answer 7: There is no liability of registration if the person is dealing with 100 percent exempt supplies.

Q8. If I register voluntarily though the turnover is less than Rs. 20 lakh, am I required to pay tax from the first supply made after registration?

Answer 8: Yes, you would be treated as a normal taxable person.

Q9. How long can I wait before registering under GST?

Answer 9: An unregistered person has 30 days to complete the registration formalities from the date of liability to obtain registration.

Q10. What if I am not liable to register under GST but I was registered under service tax?

Answer 10: You can apply for cancellation of Provisional ID on or before July 31, 2017.

Q11. What will be the impact of GST on coal? Will the clean energy cess on coal stay?

Answer 11: The clean environmental cell on coal will be replaced by a GST compensation cess.

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