GST Registration Importance for E-commerce

GST Registration in India is the most basic necessity in the tax system for identifying taxpayers and ensuring tax collection in the economy. Any business entity must register under the GST Law and get a unique number from the relevant tax authorities in order to collect taxes on behalf of the government and claim an Input Tax Credit for taxes paid on inbound goods. A person who is not registered cannot collect tax from his customers or claim an input tax credit for the tax he has paid.

Registration for the Goods and Services Tax (GST) in E-Commerce:

GST registration is required for all e-commerce businesses, regardless of sales volume. As a result, all ecommerce operators must register for GST either before starting their business or within 30 days of starting their firm.

With each passing day, Indian e-commerce grows, and it is expected to increase by 6 to 10 times in the next few years. Increasing discretionary incomes and the convenience factor associated with online buying are two critical variables leading to better outcomes for e-commerce enterprises. The government has made special arrangements to reduce the complexity of this issue, and as a result, GST registration for e-commerce would be a much easier process.

Obtaining GST registration for e-commerce is required for the majority of e-commerce businesses. Regardless of the size of the supply, all members who conduct business through e-commerce websites are required to register for GST. Regardless of who owns the website or what commodities are sold, the firm must register for GST for e-commerce.

Tax Collected at Source (TCS) Related Updates and Latest GST Registration for E-Commerce Operators Updates:

• Only those e-commerce companies who are responsible for collecting tax at source are required to register for GST.
• GST's TDS and TCS provisions went into effect on October 1, 2018.
• For inter-state supplies, the TCS rate was announced as 1% of net taxable supply or 1% of IGST.
• The TCS rate for intra-state deliveries has been set at 1% of net taxable supplies. It is made up of 0.5 percent SGST and 0.5 percent CGST.
• E-commerce firms are not allowed to register for TCS in some states and union territories where they are not physically present, according to the GST law. Only a few taxpayers began to see this as a challenge.
• As a result of eliminating this barrier, e-commerce businesses that are not physically present in any particular UT or state would be able to apply for TCS registration using their premises or registered head office location as of April 1, 2020.

Which entities are required to deduct TDS under the GST regime?

TDS will be deducted from the following entities under GST:

• Local governments
• A state or federal government institution or department.
• As indicated in a recent statement dated September 13, 2018, public sector undertakings
• Governmental organizations
• A state legislature or an Act of Parliament establishes a board, authority, or other bodies.
• The society has been established by the state government, the federal government, or other local governments.
• The board, authority, or any other body established by the state or federal government with 51 percent or active participation through control or equity

TDS would be deducted at a rate of 1% on payments made to suppliers of taxable goods or services when the total value of such supply within an individual contract exceeds Rs. 2, 50,000.

Under GST, who is responsible for collecting TCS?

• After a 1% tax was withheld, all dealers or traders involved in selling goods or services on an online platform would get money.
• E-commerce online sites are responsible for the collection and deposition of GST at a rate of 1% from all transactions under the GST statute.
• Despite having a turnover of less than 20 lakhs, all dealers or businesses selling goods or services via an online platform must register under GST to claim the tax deducted by aggregators.

E-Commerce Companies' GST Registration Process:

Any e-commerce owner who needs to collect TCS or deduct TDS would apply for GST registration online, signed, or verified via EVC (Expanded as electronic verification code) using the FORM GST REG-07 over the common portal, either directly or through a Facilitation Center reported by the Commissioner. Furthermore, after the verification process is completed, the authorized officer will award registration. The proper officer will then issue a certificate of registration using the FORM GST REG-06 within three working days of the application's submission date.

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