Understanding who needs GST registration is essential for every Indian business. From small local vendors to online marketplaces, knowing when GST is mandatory and when it’s voluntary can mean the difference between compliance and penalties.
Who Needs to Register for GST?
Let’s answer: Who needs GST registration?
Everyone whose business exceeds certain turnover limits, or falls under specific categories of supply, must register under GST.
Annual Turnover Thresholds
- `For Goods: GST registration is required when the aggregate turnover exceeds Rs. 40 lakhs in a financial year in the regular category states.`
- For Services: The threshold is essentially lower at Rs. 20 lakhs in those regular states.
Special Category States
In those states of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Uttarakhand, and usually Jammu & Kashmir:
- Goods: Registration is to be mandatorily completes on turnover exceeding ₹20 lakhs.
- Services: Registration is necessitated when the turnover has exceeded ₹10 lakhs.
Online Sellers and Inter-State Suppliers
- They must register online with effect from Day 1, irrespective of the turnover.
- If one is cross-border supplier of goods or services, even considering turnover below the threshold limit, registration is mandatory.
Compulsory Registrations (Irrespective of Turnover)
Certain categories of persons must register no matter what, including:
- Casual taxable persons (e.g., temporary stall vendors).
- Non-resident taxable persons.
- E-commerce operators and aggregators.
- TDS/TCS deductors.
- Importers/exporters, or businesses under reverse charge.
- Agents acting on behalf of registered taxpayers.
Is GST Registration Compulsory on Turnover Less Than ₹40 Lacs?
Specifically, does GST have to be paid if the turnover is below ₹ 40 lacs (for goods) and ₹ 20 lacs (for services)?
- Not in all cases. If merely one of the turnovers is below these levels, then in regular states, registration need not be considered.
- But be cautious: online sales or interstate supplies override thresholds and make registration mandatory, even with minimal turnover.
Is GST Necessary for Small Businesses?
Strictly speaking, no, if your business is very local and small-scale. But strong grounds exist for voluntary registration even when not mandated:
- Claim ITC on purchases.
- A lot of buyers and platforms look for a GSTIN as a mark of goodwill and compliance.
- Prepares for expansion: for instance, if you intend to go online or become an institutional customer.
Eligibility—Who Must Register?
To summarise who needs to register:
Businesses surpassing prescribed turnover-
- Goods: ₹40 lakhs (₹20 lakhs for special states).
- Services: ₹20 lakhs (₹10 lakhs for special states).
Online/intra- or inter-state sellers, even below thresholds
Special categories: casual/non-resident taxable persons, aggregators, TDS/TCS deductors, etc.
Beneficiaries of preferences: supplies to SEZs, zero-rated goods, public transport, and similar may be exempt.
Documents Required for GST Registration
Here’s what you’ll need to prepare when applying:
- PAN card (mandatory – GSTIN is PAN-based).
- Identity proof of the authorised signatory (Aadhaar, Passport, or Driving Licence).
- Business address proof (rented: electricity bill/lease; owned: khata/property tax).
- For companies/firms:
- Partnership Deed, if applicable
- Certificate of Incorporation for Pvt Ltd, LLP, OPC.
- MoA/AoA, Board Resolution, etc.
Fees & Costs for GST Registration
- Officially, GST registration is free on the GST portal for most applicants.
- Exceptions:
- Casual taxable persons and non-residents may pay a ₹5,000 fee.
- Professional charges (if you engage a CA or consultant):
- Proprietorship: ₹1,000–3,000
- Partnership/LLP: ₹2,500–5,000
- Private Limited Company: ₹4,000–8,000
GST Registration Process – Step by Step
Here’s a well-structured online GST registration process:
- Part A: Fill in details like taxpayer category, legal name, PAN, email, and mobile. Receive Temporary Reference Number (TRN).
- Part B: Enter TRN, received OTP, and complete the form, including: business details, structure, place of business, bank account, authorised signatory.
- Submit along with uploads of the required documents.
- You will receive an Application Reference Number (ARN) by SMS/email.
- Once approved (usually within 7–10 working days), you’ll get your GSTIN and certificate.
Recent Updates & Enforcement Trends (2025)
Compliance has become more tightly enforced in 2025:
- Authorities are leveraging UPI transaction data to identify businesses exceeding thresholds and yet unregistered (₹40 lakhs for goods / ₹20 lakhs for services). Notices have been issued.
- The Karnataka government launched the “Know GST” campaign to educate affected small traders, set up grievance helplines, and encourage regularisation.
- Small traders are shifting from UPI to cash, fearing scrutiny, despite UPI being just one of many data points.
- Authorities clarified that the transaction mode (digital vs cash) does not exempt anyone from GST liability.
- Relief is expected: GST Council may offer amnesty from penalties for small vendors caught due to UPI data, if they comply.
Summary at a Glance
| Scenario | GST Registration Required? |
| Goods turnover > ₹40 lakhs (₹20 lakhs in special states) | Yes |
| Services turnover > ₹20 lakhs (₹10 lakhs in special states) | Yes |
| Online selling or inter-state supply, any turnover | Yes |
| Under thresholds, local business | No, but voluntary possible |
| Casual/non-resident taxable persons, aggregators, importers/exporters | Yes |
| Registration cost on portal | Free (except specific cases) |
| Professional charges | ₹1,000–8,000 depending on structure |
| Recent enforcement via UPI data | Ongoing—move to register early |
Why “Who Needs GST Registration” Matters
In 2025, GST is no longer “optional for small businesses.” With digital transactions and government data analytics on the rise, compliance risk is higher. Even if your turnover stays below ₹40 lakhs or ₹20 lakhs, voluntary registration is an asset—not just for compliance—but because it affords Input Tax Credit, builds credibility, and prepares you for future growth.
When considering “who needs to get GST registration?”, the safest approach is:
- Check your turnover annually.
- Ask: Do I sell online or across states?
- Do I fall under any compulsory categories?
- If unsure, register proactively.
Being proactive shields you from penalties, improves your business image, and opens doors for expansion.
Who needs GST registration? Now you know—whether it’s because of turnover, business type, scope, or regulation. Stay compliant, stay ahead.
FAQs:
Q1. Who needs GST registration in 2025?
Any business exceeding the turnover threshold—₹40 lakhs for goods or ₹20 lakhs for services in regular states—must register for GST. Special category states have lower limits. Certain businesses, like online sellers or interstate suppliers, must register regardless of turnover to comply with Indian GST laws and avoid penalties.
Q2. Is GST registration mandatory for turnover below ₹40 lakhs?
No, if your turnover is below ₹40 lakhs for goods or ₹20 lakhs for services in regular states, GST registration Online isn’t mandatory. However, exceptions apply—such as online selling, interstate supply, or being in specific compulsory categories, where GST registration is required irrespective of your annual turnover.
Q3. Is GST necessary for small businesses?
For small local businesses below the turnover limit, GST is not compulsory. Still, many register voluntarily to claim Input Tax Credit, meet client requirements, and prepare for future growth. Online sellers, exporters, and interstate suppliers, even if small, are obligated to obtain GST registration from the beginning.
Q4. What is the turnover limit for GST registration in India?
In most states, the GST registration threshold is ₹40 lakhs for goods and ₹20 lakhs for services. In special category states, it’s ₹20 lakhs for goods and ₹10 lakhs for services. Exceeding these limits makes GST registration mandatory unless the business qualifies for exemptions under GST laws.
Q5. Who are compulsory for GST regardless of turnover?
Compulsory GST registration applies to casual taxable persons, non-resident taxable persons, e-commerce operators, TDS/TCS deductors, inter-state suppliers, and importers/exporters. Also included are agents acting for registered taxpayers and businesses under reverse charge. These categories must register from day one, even without meeting turnover thresholds, as per GST rules.
Q6. What documents are required for GST registration?
Applicants need a PAN card, identity proof (Aadhaar, Passport, or Driving Licence), business address proof, and bank account details. Firms and companies require additional documents like the Partnership Deed, Certificate of Incorporation, MoA/AoA, and Board Resolution. All documents must be valid and match the details provided in the GST application.
Q7. How much does GST registration cost?
On the official GST portal, registration is free for most taxpayers. Casual taxable persons and non-residents may pay a ₹5,000 fee. If hiring professionals, charges vary: ₹1,000–3,000 for proprietorship, ₹2,500–5,000 for partnerships, and ₹4,000–8,000 for private limited companies, depending on complexity and service provider.
Q8. What is the GST registration process in 2025?
Register online via the GST portal. Fill Part A to get a Temporary Reference Number, then Part B with business and bank details, authorised signatory, and required documents. Submit the application to receive an Application Reference Number. Upon approval, GSTIN and a certificate are issued, usually within 7–10 working days.
Q9. What happens if I don’t register for GST when required?
Operating without GST registration when mandatory can lead to heavy penalties, interest on tax dues, and seizure of goods. Penalties may include 10% of the tax due or ₹10,000, whichever is higher. In cases of intentional evasion, penalties can reach 100% of the tax amount.
Q10. Can I register for GST voluntarily?
Yes, businesses below the threshold can register voluntarily. This allows claiming Input Tax Credit, enhancing credibility, and expanding into interstate or online markets without future compliance hurdles. Voluntary GST registration also helps businesses align with larger clients’ requirements and ensures readiness for rapid business growth or scaling operations.
