Am a small business providing Website designing and Digital Marketing services to clients in Australia. I have been running this business from 2018 and last year my turnover was 37 Lakhs for the year. I was under the impression that because I am into export of service I do not need to register for GST even though my turnover has exceeded 20 Lakhs for a year(Advised by a CA), But recently after speaking to few other CA's I have got mixed opinions and not sure what to do now! I would humbly request your expert advise on the following two questions- 1. Am I liable to register for GST when my turnover exceeds 20 Lakhs? 2. If Yes, What is the possible penalty for the default done last year?
Hii
1 yes gst registration is mandatory
after getting registered you have 2 options
1 pay IGST and apply for refund
2 file LUT and render your services without paying IGST
2 Penalty of not getting registered is applicable however for tax you may get relief due to export of services or you have to pay taxes with interest then can claim refund
both depends on assessing officer
Dear Sir,
Hope you are doing well !!
1. Yes, you would be required to get GST registration after crossing the limit of RS 20 lakh.
As per the provisions contained under IGST law, export of goods or services or both are to be regarded as “zero-rated supplies” and a person being a registered taxable person exporting such goods or services or both shall be allowed to claim the refund of the GST paid under one of the following two options:
2. Penalties can be levied/ waived off because export are zero rated supplies.
It depends on the proper submission and AO.
We may assist you in proper submission & entire procedure.
1. Yes you are liable to register. Limit for registration is 20 lacs in case of services.
2. Penalty could be 100% of tax due or 10000. You should take registration immediately and file an LUT(online declaration for export of services without payment of GST.
Hi
1. Yes you need registered for GST.
Being an exporter you have 2 option :-
Option 1: Supply goods or services, or both, under bond or Letter of Undertaking, subject to such conditions, safeguards and procedure as may be prescribed, without payment of integrated tax, and then claim a refund of unutilised input tax credit.
The exporter needs to file an application for refund on the common portal either directly or through the facilitation ccenternotified by the GST commissioner. An export manifest or report has to be filed under the Customs Act prior to filing an application for refund.
Option 2: Any exporter or United Nations or Embassy or other agencies/bodies as specified in section 55 who supplies goods or services, or both, after fulfilling certain conditions, safeguards and procedures as may be prescribed; and paying the IGST, can claim refund of such tax paid on the supplied goods or services, or both. The applicant has to apply for the refund as per the conditions specified under section 54 of the CGST Act.
2. 10,000 or amount of tax evaded or any short tax liability whichever is higher. Hence, if any person fails to take GST registration and the total tax liability after calculation comes to Rs. 2 lakh, then the penalty for failure to take GST registration shall be 2 lakh or Rs. 10,000 whichever is higher
In case of zero rated services it depends on AO.
Dear Sir,
In case of export of services, one needs to get compulsorily registered for gst once the turnover exceed the threshold limit.
Possible consequences for not getting registered under gst even when there were legal requirements to do so can be : A penalty of Rs.10,000/- or tax invaded – whichever is higher, Input Tax Credit (ITC) cannot be claimed, Input Tax Credit (ITC) cannot be transferred.
Thanks & Regards
Shiv Kumar Agarwal
Hello,
1. Yes, you are liable to register under GST.
Either you can supply your export services under LUT without payment of GST,
Or, you can supply your export services with payment of GST and later on claim the refund.
GST return filing compliances would be required.
2. The penalty could be Rs. 10,000 or amount of tax evaded, whichever is higher.
I hope this answer satisfies your requirements.
Regards,
CA Hunny Badlani
Yes you are surely liable to register.
You should have registered last year itself.
They might ask for GST on amount exceeding 20 lakh along with interest but since it will be export you'll get refund of GST but you'll have to pay interest @18% p.a. on such GST.
Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.
Thank you
1. Yes, you were required to get gst registration. Although, you are not liable to pay gst but you are required to get gst registration and file gst returns.
2. Possible penalty can be huge and it could go upto 18% of the turnover (basically the gst amount om that services) + interest on that and some penalty of late gst registration.
