GST Registration in India : Who Must Register, Threshold Limits, Mandatory Cases and Voluntary Registration

What Is GST and Why Does Registration Matter?

Goods and Services Tax, commonly known as GST, is a destination-based indirect tax imposed on the supply of goods or services or both. It replaced several Central and State indirect taxes and created a system under which tax is collected at different stages of the supply chain, while eligible businesses receive credit for the GST paid on their purchases.

For an intra-State supply, GST is generally divided into CGST and SGST/UTGST. For an inter-State supply, IGST is charged.

GST registration is the process through which a person obtains a unique 15-digit Goods and Services Tax Identification Number, or GSTIN. A registered person can issue GST-compliant tax invoices, collect GST from customers and claim eligible input tax credit. An unregistered person cannot legally collect GST merely by describing an amount as GST on an invoice.

However, every business does not automatically require registration. Liability depends on:

• The nature of goods or services supplied;

• Aggregate turnover under the PAN;

• The State or Union Territory from which supplies are made;

• Whether supplies are intra-State or inter-State;

• Whether sales are made through an e-commerce platform; and

• Whether any compulsory-registration provision applies.

• The GST registration framework is primarily contained in Sections 22 to 25 of the CGST Act.

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The following table provides a preliminary indication. The final conclusion should be reached only after examining aggregate turnover, place of supply, exemptions and the nature of each activity.

Your situation	Is GST registration required?	Important condition
You provide services and aggregate turnover exceeds Rs.20 lakh	Yes	Limit is Rs.10 lakh in Manipur, Mizoram, Nagaland and Tripura
You supply both goods and services and turnover exceeds Rs.20 lakh	Yes	Mixed suppliers normally cannot use the Rs.40 lakh limit
You exclusively supply goods and turnover exceeds Rs.40 lakh	Generally yes	Rs.40 lakh benefit is available only in eligible States and subject to conditions
You exclusively supply goods in Telangana, Puducherry or specified north-eastern/hill States and turnover exceeds Rs.20 lakh	Yes	These States/UTs have not adopted the Rs.40 lakh goods threshold
You exclusively make wholly exempt, nil-rated or non-taxable supplies	Generally no	Exemption applies only while all supplies remain covered
You are an agriculturist selling produce grown through cultivation of land	No, to that extent	Other business activities must be examined separately
You make inter-State taxable supplies of services below the applicable Rs.20 lakh/Rs.10 lakh limit	Generally no	Threshold exemption is available to eligible service providers
You export services below the applicable threshold	Not necessarily mandatory	Voluntary registration may be needed for LUT, ITC or refund benefits
You export taxable goods	Generally yes	Export of goods is treated as an inter-State supply
You sell goods through an e-commerce operator	Depends	Unregistered intra-State sales are permitted subject to the 2023 enrolment conditions
You provide services through an e-commerce platform	Depends	Threshold exemption may continue, except for specified Section 9(5) services
You are liable to pay GST under reverse charge	Generally yes	Registration may be required regardless of turnover
You occasionally conduct business in another State without a fixed place there	Yes, as a casual taxable person	Registration is normally required before commencing the activity
You are below the threshold but want input tax credit and B2B customers	Optional	Voluntary registration may be considered

The official registration guidance continues to prescribe Rs.40 lakh for eligible exclusive suppliers of goods, Rs.20 lakh for services or mixed supplies, and lower limits for specified States. The Government also confirmed in September 2025 that there was no change in the registration threshold for goods.

1. What Is “Aggregate Turnover” for GST Registration?

The most important expression for determining registration liability is not sales, receipts, taxable income or accounting profit. It is aggregate turnover.

Aggregate turnover is calculated:

• For the entire financial year;

• On an all-India basis;

• For all businesses and branches having the same PAN; and

• Not separately for each GSTIN, branch, trade name or State.

It generally includes:

Included in aggregate turnover	Normally excluded
Taxable supplies	CGST, SGST, UTGST, IGST and compensation cess
Exempt and nil-rated supplies	Inward supplies on which tax is payable under reverse charge
Non-taxable supplies that qualify as supplies	Transactions that are neither a supply of goods nor a supply of services
Export turnover, Inter-State supplies	Pure capital receipts not connected with a supply

The statutory definition includes taxable supplies, exempt supplies, exports and inter-State supplies of persons having the same PAN, while excluding GST and inward supplies liable to reverse charge.

Aggregate Turnover Is Not the Same as Taxable Turnover

A business may have only Rs.8 lakh of taxable turnover but still cross the Rs.20 lakh registration limit because it also has Rs.15 lakh of exempt supplies. Registration may therefore become applicable even though GST is payable only on the taxable portion.

For example, suppose an individual has:

• Commercial property rent: Rs.6 lakh; and

• Exempt interest : Rs.22 lakh.

The aggregate turnover may be Rs.28 lakh. Registration may consequently be required even though GST would be payable only on the taxable commercial rent. The exact treatment of passive or personal interest income can involve factual and interpretational issues and should be professionally reviewed.

Common Items That Usually Do Not Form Part of Turnover

The following receipts ordinarily do not represent a supply and therefore are generally not included:

• Salary received from an employer;

• Dividends;

• Sale or purchase of shares and securities;

• Sale of land;

• Sale of a completed building, subject to the GST provisions;

• Loans or capital introduced into the business; and

• Donations or gifts received without any corresponding supply.

• The nature of the receipt matters more than the description used in the accounts.

2. Normal GST Registration Thresholds

A. Supplier of Services or Mixed Supplier

A person supplying services, or both goods and services, is generally required to register when aggregate turnover in a financial year exceeds Rs.20 lakh.

The lower limit of Rs.10 lakh applies where taxable supplies are made from:

• Manipur;

• Mizoram;

• Nagaland; or

• Tripura.

B. Person Exclusively Supplying Goods

An eligible person engaged exclusively in supplying goods can generally remain unregistered until aggregate turnover exceeds Rs.40 lakh.

However, the Rs.40 lakh limit is not available in the following States and Union Territory, where the relevant goods threshold is generally Rs.20 lakh:

• Arunachal Pradesh;

• Manipur;

• Meghalaya;

• Mizoram;

• Nagaland;

• Puducherry;

• Sikkim;

• Telangana;

• Tripura; and

• Uttarakhand.

The official CBIC registration material provides the State-wise distinction between the Rs.40 lakh and Rs.20 lakh goods thresholds and the Rs.20 lakh and Rs.10 lakh service thresholds.

When Is the Rs.40 Lakh Limit Not Available?

A trader should not automatically assume that the Rs.40 lakh limit applies merely because most revenue comes from goods.

The enhanced threshold may not be available where:

• The person is liable for compulsory registration under Section 24;

• The person supplies specified goods, including certain ice cream, pan masala, tobacco, bricks and tiles;

• The business is situated in a State or Union Territory that has retained the Rs.20 lakh limit;

• The person has opted for voluntary registration; or

• The person is not genuinely engaged exclusively in the supply of goods.

3. When Does Turnover Cross the GST Threshold?

Registration liability arises when aggregate turnover exceeds, rather than merely reaches, the applicable threshold.

For example:

--> A service provider with turnover of exactly Rs.20 lakh has not exceeded the normal threshold.

-->The next taxable or exempt supply that takes turnover above Rs.20 lakh triggers registration liability.

-->The application must generally be made within 30 days from the date liability arises.

-->Turnover should be monitored continuously during the year. Waiting until the financial year is over can result in delayed registration, past tax liability, interest and penalty exposure.

4. Compulsory GST Registration Regardless of Turnover

Section 24 specifies categories for which the normal turnover threshold is generally unavailable. However, this rule must be read together with Section 23 and notifications granting specific exemptions.This is important because the phrase “mandatory irrespective of turnover” is not absolute in every case. A notified exemption under Section 23 may override the compulsory-registration provision.The principal compulsory-registration cases are discussed below.

4.1 Inter-State Taxable Supplies

A person making an inter-State taxable supply is generally required to register regardless of turnover.

 Important exceptions

Threshold exemption continues to be available to eligible persons making inter-State taxable supplies of services. Thus, a consultant in Gujarat providing services to a client in Maharashtra does not automatically require registration merely because the transaction is inter-State. Registration is generally required only when aggregate turnover exceeds Rs.20 lakh.

Similar relief is available in certain cases involving:

• Specified handicraft goods;

• Specified goods made predominantly by hand; and

• Inter-State job-work services, subject to applicable conditions.

• The official CBIC guidance expressly recognises threshold relief for small inter-State service providers and specified job workers.

4.2 Casual Taxable Person

A casual taxable person occasionally supplies taxable goods or services in a State or Union Territory where the person has no fixed place of business.

Examples include:

-->An event organiser from Karnataka conducting a taxable event in Goa;

-->A caterer from Maharashtra providing services at an event in Delhi; or

-->A trader temporarily setting up a taxable exhibition stall in another State.

-->Such a person generally has to apply at least five days before commencement, deposit the estimated net tax liability and obtain a time-bound registration. The initial validity is normally up to 90 days and may be extended subject to conditions.

4.3 Person Liable to Pay GST Under Reverse Charge

A recipient required to pay GST under reverse charge may be required to obtain registration regardless of turnover.

Common reverse-charge transactions can include specified:

• Legal services;

• Goods transport agency services;

• Security services;

• Services supplied by the Government;

• Renting of motor vehicles; and

• Notified supplies received by specified classes of persons.

• Registration should not be assumed merely because an expense invoice mentions “RCM”. The precise notification, supplier category, recipient category and nature of supply must first be checked.

4.4 Electronic Commerce Operator Liable Under Section 9(5)

• For notified services supplied through an electronic commerce platform, the platform may be treated as the person liable to pay GST.

• Notified categories include specified:

• Passenger transportation services;

• Accommodation services;

• Housekeeping services; and

• Restaurant services.

• The e-commerce operator liable under Section 9(5) must obtain registration irrespective of turnover.

4.5 Non-Resident Taxable Person

• A person located outside India who occasionally undertakes taxable supplies in India, without a fixed place of business or residence in India, is generally required to register.

• A non-resident taxable person must normally:

• Apply at least five days before commencing business;

• Provide the prescribed foreign identification documents;

• Appoint an authorised signatory in India;

• Deposit estimated tax liability in advance; and

• Operate under a limited-period registration.

• There is no normal turnover threshold for this category.

4.6 Persons Required to Deduct GST TDS

• Government departments, local authorities, governmental agencies and other notified persons required to deduct tax under Section 51 must obtain a separate TDS registration.

• This registration is separate from a normal supplier registration and does not depend on turnover.

4.7 Agents Making Taxable Supplies on Behalf of Taxable Persons

• A person making taxable supplies on behalf of another taxable person may require registration regardless of turnover.

Merely earning commission does not automatically make every intermediary compulsorily registrable. The important questions include:

• Does the agent issue the supply invoice in the agent’s own name?

• Does the agent receive or supply goods on behalf of the principal?

• Does the agent have authority to transfer or receive title?

• Is the principal a taxable person?

• Is the underlying supply taxable?

• An independent dealer who purchases and resells goods on their own account is ordinarily not an “agent” for this purpose. The handbook explains that compulsory registration arises where the agent makes taxable supplies on behalf of a taxable principal, while mere coordination may not be sufficient.

4.8 Input Service Distributor

• An office receiving common input-service invoices for distribution of input tax credit to other GST registrations must obtain a separate Input Service Distributor registration.

• This requirement applies regardless of turnover and is separate from the normal GST registration of the head office or branch.

4.9 Suppliers Through E-Commerce Operators

Historically, persons supplying through an e-commerce operator required registration irrespective of turnover. That position now has important exceptions.

Small suppliers of services - Eligible service providers supplying through an e-commerce operator can continue to claim the normal Rs.20 lakh or Rs.10 lakh threshold, except for services covered by Section 9(5).

Small suppliers of goods - From 1 October 2023, eligible persons may supply goods through an e-commerce operator without obtaining full GST registration, subject to conditions such as:

• Turnover not exceeding the applicable threshold in the preceding and current financial year;

• Only intra-State supplies;

• Operations through the platform limited to one State or Union Territory;

• Possession of PAN;

• Declaration and validation of business details on the portal; and

• Obtaining an enrolment number before commencing supplies.

• The exemption does not permit an unregistered supplier to make inter-State supplies through the platform.

4.10 E-Commerce Operators Required to Collect TCS

An e-commerce operator required to collect tax at source under Section 52 must obtain the prescribed registration irrespective of turnover.

4.11 Foreign OIDAR Suppliers

A foreign supplier providing online information and database access or retrieval services to unregistered recipients in India must obtain the prescribed simplified GST registration.

OIDAR can include qualifying:

• Cloud services;

• Online advertising;

• E-books and digital content;

• Software supplied online;

• Digital data storage; and

• Electronically delivered information services.

4.12 Foreign Suppliers of Online Money Gaming

A person supplying online money gaming from outside India to a person in India is specifically required to obtain registration under the prescribed mechanism.

4.13 Transfer, Succession, Amalgamation or Demerger

• Registration can also become mandatory because of a business reorganisation.

• Where a registered business is transferred as a going concern, the transferee or successor is generally required to register from the date of transfer or succession. In an amalgamation or demerger, registration implications arise from the legally effective date specified under the approved scheme and incorporation documents.

5. Who Is Not Required to Obtain GST Registration?

5.1 Persons Exclusively Making Exempt or Non-Taxable Supplies

A person exclusively supplying goods or services that are wholly exempt, nil-rated or not liable to GST is generally not required to register.

Examples may include a person exclusively supplying:

• Specified exempt healthcare services;

• Qualifying educational services;

• Fresh agricultural produce;

• Petrol or diesel;

• Exempt charitable services; or

• Other wholly exempt goods or services.

• The moment the person begins making a taxable supply, the entire aggregate turnover—including exempt turnover—may become relevant for testing the threshold.

• A charitable trust, educational institution, hospital or non-profit organisation is not automatically outside GST merely because of its constitution. The actual activities and consideration received must be examined.

5.2 Agriculturist

• An individual or HUF carrying out cultivation through own labour, family labour or hired labour under personal supervision is not required to register to the extent of supplying produce arising from cultivation of land.

• The exemption does not automatically cover:

• Trading in produce purchased from others;

• Food processing beyond the permitted agricultural operations;

• Renting commercial property;

• Commission income; or

• Unrelated taxable business activities.

5.3 Supplier Whose Entire Tax Is Payable by the Recipient Under RCM

• A supplier exclusively making supplies on which the recipient is liable to pay the entire GST under reverse charge may be exempt from registration under Notification No. 5/2017-Central Tax.

For example, an individual advocate supplying only notified legal services to business entities may qualify for this exemption. However, the exemption must be reconsidered if the advocate also earns taxable forward-charge income.

From October 2024, this exemption does not extend in the same manner to specified suppliers of metal scrap covered by the relevant notification.

6. Voluntary GST Registration

• A person who is not required to register under Sections 22 or 24 may choose to register voluntarily under Section 25(3).

• Once registered voluntarily, the person is treated in the same manner as any other registered taxpayer. Voluntary registration is not a “light” or restricted form of GST registration.

When Voluntary Registration May Be Beneficial

Possible benefit	Practical significance
Input tax credit	Eligible GST on purchases and expenses can be claimed, subject to conditions
B2B acceptability	Registered customers can receive a tax invoice and claim eligible ITC
Business expansion	Registration avoids last-minute disruption when turnover is expected to cross the threshold
Tender and vendor onboarding	Large companies and institutions may prefer registered suppliers
Export refunds	Registration may facilitate LUT filing and refund of eligible accumulated ITC
E-commerce expansion	Registration may allow wider inter-State and multi-State operations
Business credibility	GST registration can support formal vendor and banking documentation

Disclaimer : This article is for informational purposes only and should not be construed as legal or professional advice. Taxpayers should consult their tax advisor based on the facts of their specific case before taking any action.