The turnover limit for GST registration was set with various factors in mind, and it is significantly higher for businesses to be subject to service tax. The amount of money a businessman makes in a specific period is their turnover. Currently, the threshold is set at Rs 20 lakhs (Rs. 40 lakhs for goods).
It is the amount below which a business is not required to register for GST. This article goes over the specifics of the turnover limit for GST registration.
Let’s begin.
What is the turnover limit for GST Registration?
The aggregate turnover for the supply of services and goods is Rs. 20 lakhs and Rs. 40 lakhs. The limit for taxable supplies of goods or services or both for special category states, is Rs. 10 lakhs.
| States with an Rs. 10 lakh threshold for both goods and services | States/UTs with a threshold limit of Rs. 20 lakhs for both goods and services | States/UTs with a service threshold of Rs. 20 lakhs and a goods threshold of Rs. 40 lakhs |
| Manipur | Arunachal Pradesh | Jammu and Kashmir |
| Mizoram | Meghalaya | Assam |
| Nagaland | Sikkim | Himachal Pradesh |
| Tripura | Uttarakhand | All other States |
| Puducherry | ||
| Telangana |
Who is eligible for GST registration?
The following individuals are eligible for GST registration:
- Any business whose aggregate turnover exceeds the prescribed threshold limit.
- Persons registered under previous legislation such as service tax, and VAT.
- Any person who makes interstate supplies of goods and/or services
- Casual Taxable Person
- Non-resident taxable individual
- The supplier’s agent.
- People who pay tax under an RCM when a business is transferred or spun off.
- Electronic Commerce Operators or Aggregators.
What is GST turnover limit in Telangana?
Businesses falling into the following categories are required to obtain GST registration in Telangana.
Aggregate turnover: Any service provider providing services over Rs.20 lakh per year must get GST registration in Telangana.
The entity supplying the goods must exceed INR 40,00,000, but it is mandatory to have GST registration in Telangana.
Interstate Business:
A business must obtain GST registration in Telangana if it is involved in shipping goods from one state to another.
Casual taxable person: Any person who seasonally supplies goods or services through temporary stalls or stores must obtain her GST registration in Telangana. Regardless of turnover, the individual must apply for GST registration.
E-commerce platform: If you engage in providing goods or services through an e-commerce platform, regardless of your income, you must obtain GST registration in Telangana.
What are the 3 types of turnover?
Following are the types of turnover:
- Aggregate turnover
- Turnover in State/turnover in Union territory
- Adjusted Total Turnover
Aggregate turnover:
This means the aggregate value of—
- all taxable supplies (excludes the value of inward supplies on which tax is payable by a person on a reverse charge basis),
- exempt supplies,
- export of goods and/or services, and
- inter-State supplies of a person who has the same Permanent Account Number (PAN) across all entities in India but excludes GST and cess.
Turnover in State/turnover in Union territory:
This means the aggregate value of—
- all taxable supplies (excludes the value of inward supplies on which tax is payable by a person on a reverse charge basis),
- exempt supplies made by a taxable person within a State or Union territory,
- export of goods and/or services, and
- inter-State supplies of goods or services or both made from the State or Union territory by the said taxable person excludes GST and cess.
Adjusted Total Turnover:
This means the total value of—
- The turnover in a State or a Union territory, as defined in section 2(112), excluding the turnover of services; and
- The turnover of zero-rated supply of services determined in terms of Rule 89(4)(D) and non-zero-rated supply of services, excluding—
- Exempt supplies other than zero-rated supplies; and
- The turnover of supplies in respect of which refund is claimed u/r 89(4A) or (4B) or both, if any, during the relevant period. The relevant period is the time period for which the claim was filed.
What does excluding GST mean?
This means that tax is not included in the prices charged for goods and/or services.
Tax will be added separately to the price.
For example: If the item price is 200 rupees and the GST rate is 5%, the customer has to pay 210 rupees as the price is exclusive of tax.
How do I calculate turnover?
To determine if a supplier must register for GST, aggregate turnover is calculated. Always take the previous financial year’s figures into account for calculating the company’s aggregate turnover.
The aggregate turnover is:
Value of all taxable supplies, exempt supplies, exports, inter-state supplies
Minus
Taxes, the value of inward supplies, value of supplies taxable under reverse charge, value of non-taxable supplies
of a person who has the same Permanent Account Number (PAN) across all entities in India.
Value of all {( taxable supplies + Exempt supplies + Exports + Inter-state supplies) – ( Taxes + Value of inward supplies + Value of supplies taxable under reverse charge + Value of non-taxable supplies )} of a person who has the same Permanent Account Number (PAN) across all entities in India.
What is GST monthly return turnover limit?
GST monthly return turnover limit:
Monthly filing of GSTR-1: Annual turnover of more than Rs.5 crore must file monthly only.
Monthly filing of GSTR-3B: Annual turnover of more than Rs.5 crore must file monthly only.
How much is GST quarterly return turnover limit ?
All taxpayers whose aggregate annual turnover (PAN-based) is up to ₹ 5 Crore in the current financial year and the preceding financial year (if applicable) and have already filed their last due Form GSTR-3B return, must file quarterly returns.
Frequently Asked Questions (FAQs)
What is a tax turnover?
A turnover tax is a gross transaction tax usually imposed by manufacturers, wholesalers, and retailers on all sales of goods.
Can I register for GST if turnover is less than 75000?
Registration for GST is optional if your GST income is less than 75,000.
However, once registered, you will have to include GST in your charges and apply for GST credit on your business purchases regardless of your turnover.
What is GST limit for small business below 20 lakhs?
A trader dealing only in exempted goods or where his turnover is below Rs 20 lakh in the financial year, but not engaged in inter-state supplies, is not required to register under GST.
Is turnover revenue or profit?
Revenue is another term for turnover. Sometimes the terms revenue and turnover mean the same thing.
What is a good turnover ratio?
A good turnover ratio is in the range of 5 to 10.
Is turnover better than profit?
Turnover is better than profit. Turnover has nothing to do with profit. Profits depend on turnover because without turnover there is no profit.
How much is GST registration limit for export of services?
GST Registration is mandatory for export of services in India regardless of the turnover.
Wrapping Up
From the foregoing, it is clear that GST includes all non-taxable and exempt supplies, including exports. The aggregate turnover structure might not benefit small taxpayers.
If you’re still unsure about GST as a business owner, contact the GST experts at InstaFiling.