Compulsory Registration under GST Act Section 24
To follow the tax system government introduced GST registration which is a key process for those businesses in India that supply goods and services. These types of businesses must register GST to comply with the tax rules under the CGST Act 2017. This registration depends on the set limit by section 22(1) of turnover of the businesses, if it crosses then you have to register for GST and pay tax.
But apart from this, some businesses have to register GST even if they do not cross the setting limit of turnover. There are lists of categories (offered by Section 24 of the CGST Act 2017) of businesses and persons, who have to register GST and pay taxes. It includes details about casual taxable persons, entities that do inter-state supply, and those people who pay tax under the reverse charge mechanism. So, in this blog, we are going to tell you everything about Compulsory GST Registration under section 24. Let’s start.
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Compulsory Registration under GST Act Section 24
Compulsory Registration under GST Act Section 24
Compulsory Registration under GST Act Section 24 To follow the tax system government introduced GST registration which is a key process for …
What is Compulsory Registration Under GST?
Under Section 24 of the CGST Act 2017, some people and businesses must register for GST, even if their total turnover is below the limit mentioned in Section 22(1). This rule applies even if they are otherwise exempt from GST registration under the CGST and SGST Acts.
These are some categories required –
1. Interstate taxable supplies by individuals.
2. Provide taxable supplies by causal taxable persons.
3. Under the reverse charge mechanism, persons are liable to pay.
4. Electronic Commerce Operators.
5. Provide taxable supplies by non-resident taxable persons.
6. Under section 51, persons are required to deduct tax.
7. On behalf of other agents or individuals supplying taxable goods & services.
8. Input Service Distributors.
9. People or businesses outside India providing online information or database services to unregistered individuals in India.
10. Based on GST Council recommendations, any other persons or classes of persons as notified by the Government.
This list must register for GST, no matter how much they earn, ignoring the rules in Section 22(1).
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Applicability Of Compulsory Registration Under GST Act Section 24
Those persons apply for compulsory registration under GST Act Section 24 and are required to obtain GST registration irrespective of their aggregate turnover.
Threshold Limits for Registration
1. Turnover Criteria – The standard GST registration threshold limit for goods suppliers is set at Rs. 40 lakhs, and Rs. 20 lakhs for service providers across most states in India. These threshold exemptions do not extend to individuals who are mandated to register under Section 24.
2. Exceptional Category States – For suppliers of goods the threshold limit for GST registration is Rs. 20 lakhs and for suppliers of services the limit is Rs. 10 lakhs in the special category states which are Assam, Meghalaya, Mizoram, Sikkim, Nagaland, Himachal Pradesh, Manipur, and Uttarakhand, Tripura. This limit does not apply on persons who are compulsorily required to register under section 24.
3. Input Tax Credit – Businesses registered under GST can get a tax credit for the taxes paid on their purchases, which lowers their total tax.
4. Reporting & Compliance – Those businesses who register under GST have to maintain proper records, pay GST to the tax authorities, and file GST returns on time.
5. Audit & Compliance – Tax authorities are required to conduct frequent audits after GST registration. To maintain compliance & accuracy they audit invoices, transactions, and records.
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Compulsory Registration Criteria for Activities
1. Inter-State Supplies – People selling goods or services between states must register for GST under Section 24(i), no matter how much they earn. There are some exceptions to this rule:
• People providing services between states don’t need to register for GST if their total turnover is below ₹20 lakhs or ₹10 lakhs, depending on the case.
• People selling handicraft goods or specific products between states don’t need to register for GST if their total turnover is below ₹20 lakhs or ₹10 lakhs, depending on the case.
2. Casual Taxable Persons – People who sell goods or services in a state or union territory where they don’t have a fixed business location must register under Section 24(ii), no matter how much they earn.
However, there are exceptions:
• If they sell handicraft goods or specific products outside their state/territory and their total turnover is less than ₹20 lakhs (or ₹10 lakhs, depending on the case), they don’t need to register.
• No registration is needed if goods are moved on an approval basis, as long as the invoice is issued when the goods are delivered.
3. Non-Resident Taxable Persons – Those persons who are not residents of India but engage in the taxable supply of goods or services of this country need to register under section 24 (v).
4. Reverse Charge Mechanism – If you need to pay GST on goods or services you buy (reverse charge), you must register under Section 24(iii), no matter how much you earn.
• Exception – If you only sell goods or services where the buyer pays GST under reverse charge, you don’t need to register.
5. Services Through E-Commerce Platforms – If you provide certain services through an E-Commerce Operator (ECO), like:
• Taxi or bike rides (e.g., radio taxi, motor cab)
• Hotel or lodging accommodations
• Housekeeping services (like plumbing, carpentry)
The ECO will pay GST for you. However, you must register if your turnover is below ₹20/10 lakhs.
6. TDS Deduction (Section 24(vi)) – If you’re required to deduct GST (TDS) under Section 51, you must register separately, even if you already have GST registration.
7. Agents Under GST – Only C&F (Carrying and Forwarding) agents, who store and sell goods for others, need mandatory registration, even if their earnings are below ₹20/10 lakhs.
Ordinary agents earning below the threshold don’t need to register.
8. Input Service Distributor – Any business distributing GST input credit must register as an Input Service Distributor, no matter their turnover.
9. E-Commerce Sellers – If you sell goods or services through an E-Commerce Operator, you must register for GST when the operator collects tax at source.
10. E-Commerce Operators – E-Commerce platforms must register and collect tax at source under Section 52.
11. OIDAR Services – Businesses outside India providing online services (like databases, and information) to unregistered individuals in India must register for GST.
If the customer is registered under GST, separate registration isn’t needed.
12. Special Categories (Section 24(xii)) – The Central or State Government can specify other categories that require GST registration based on GST Council recommendations.
13. General Exceptions – No GST registration is needed if:
• You deal only in exempt goods/services.
• You’re a farmer or an agriculturist.
Your earnings are below the threshold, and the buyer pays GST under reverse charge.
Conclusion
Understanding GST rules under Section 24 is essential for businesses. Mandatory GST registration ensures compliance, access to input tax credits, and smooth operations. With GST registration services in India, businesses can meet legal requirements effortlessly, avoid penalties, and focus on growth. Stay compliant, save taxes, and secure your business’s future with professional GST registration assistance!
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