The Indian government launched the Goods and Services Tax (GST) on 1 July 2017 to simplify India’s tax structure. The main aim of implementing it was one nation, one tax, one market. GST has replaced a dozen central and state-levied taxes such as excise, VAT, and service tax.
Business entities need to register under GST and obtain a unique 15-digit Goods and Services Tax Identification Number (GSTIN). This has replaced the Tax Identification Number (TIN) allotted to businesses by state tax authorities for registering under the VAT system.
Under GST, all registered taxpayers will be consolidated onto a single platform for compliance and administration purposes and will be registered under a single authority.
What is GSTIN?
GSTIN, which stands for Goods and Services Tax Identification Number, is a unique 15-digit number given to every taxpayer (mainly dealers, suppliers, or any business entity) registered under the GST system.
Before GST came into effect, all dealers registered under the state VAT law were given a unique TIN number by the respective state tax authorities. The GSTIN has replaced this number.
Now, businesses registering under GST are given a unique identification number called GSTIN.
Getting a GSTIN and registering for GST is completely free of cost.
GST number example
Let us take the GST number 27AAAPA1234A1Z5 as an example:
27: Maharashtra (state code)
AAAPA1234A: PAN of the business
1: First registration under this PAN in Maharashtra
Z: Reserved character
5: Checksum digit for error detection
This breakdown of the GST number helps simplify the GST system, ensures accuracy, and makes it easier for authorities to verify and manage GST-related activities.
GST number format
You can check a GST number in the following way:
First, you need to know what a GST number is:
- A GST number consists of 15 digits
- For example, take the GST number 08 ABCDE9999F1Z8
- The first two digits represent the state code; for Rajasthan, it is 08
- The next 10 digits show the PAN number of the business
- The 13th digit indicates the number of firms registered under this GST
- The last two digits are a unique number assigned to the firm
Steps to check the authenticity of a GST number:
If you are unsure about the GST number provided in an application, you can verify it using the firm’s PAN (if available). In the example above, the firm's PAN is ABCDE9999F (this is shown in the 3rd to 12th digits of the GST number).
You can also check the GST number online by following these steps:
- Visit https://www.gst.gov.in/
- Click on the 'Search Taxpayers' tab
- Choose to search by either 'GST' or 'PAN' here
- Enter the GST number or PAN and click the 'Search' button
- If the GST or PAN is correct, it will display all the firm’s details, which you can verify
Why do you need a GSTIN?
To run your business legally in India, you need a GSTIN number if your annual turnover is more than Rs. 40 lakh (or Rs. 10 lakh for Northeast states). Registering for GST and getting a GSTIN helps you avoid fines and penalties.
Here are some reasons why you should know how to get a GST number online.
1. Filing GST returns
You need a GST number to file GST returns, which are regular reports of your business transactions and tax amounts. Filing these returns is required for every GST-registered person, even if there's no business activity or tax due for a certain period.
2. Claiming back GST paid (Input tax credit)
A GST number is also needed to claim back the GST you've paid on business purchases (input tax credit). You can only claim this if the supplier has recorded the invoice details on the GST portal and included your GST number on the invoice.
3. Avoiding fines
Having a GST number is important to avoid fines for not following GST rules. If you need to register for GST but don't, you could be fined 10% of the tax owed or Rs. 10,000, whichever is higher. Also, if you collect GST from customers but don't pay it to the government, you could be fined 100% of the tax amount. Not having a GST number could also affect your chances of getting a business loan.
Additional read: How to calculate GST
GSTIN search and verification tool
If you have your GSTIN, you can verify any GSTIN with a single click on the GSTIN search tool, free of cost.
Benefits of the online GSTIN search and verification tool
- Checking for authenticity
- Easy verification
- Prevention against association with vendors using fake GSTINs
- Avoiding fraud
- Correction of any errors in reporting GSTIN
How to verify GSTIN?
There are two main ways to verify a GST tax number: Online and offline.
Online method
This method involves a simple two-step process to verify the GST number using the official website of the Goods and Services Tax, provided by the Government of India.
First, visit the official GST website and click on the ‘Search Taxpayer’ option.
Then, enter the GSTIN and click on ‘Search’.
If the GST details are correct, the information such as the business name, state of operation, date of registration, and other important details will appear on the screen.
If the GST details are incorrect, a message will show up saying, "GST details are incorrect. Please enter a valid GST number."
Offline method
For offline verification, you can contact the relevant tax department or check the physical documents related to the GST number.
How to apply for a GSTIN?
Registering for GST and obtaining a GSTIN is free of cost. There are two ways for taxpayers to register under the GST system:
- Register online on the GST portal.
- Visit the GST Seva Kendra set up by the Government of India.
Applying online is the easier option. You can follow these steps to do so:
- Log on to official GST Portal , click on the ‘services’ tab, hover over ‘registration’, and then click on ‘New Registration’.
- Once the page refreshes, select ‘New Registration’ and fill the form with the details carefully. Take care to enter information in all the fields marked with a red dot because providing this information is compulsory. Also, enter your email ID and phone number as you will receive an OTP on both.
- Once filled, click on ‘Proceed’. Next, enter the OTPs that you have received on your email ID and phone number. You have a window of 10 minutes to do so, after which the OTP expires and must be regenerated.
- The screen will then display a TRN or Temporary Reference Number. Note this, and then go back to the home page, click on the ‘services’ tab, hover over ‘registration’, and then click on ‘New Registration’.
- This time, when the form is presented to you, click on ‘Temporary Reference Number’ instead of ‘New Registration’. Enter the TRN and the CAPTCHA code, as well as a new OTP that the system generates.
- Once you are directed to the ‘My Saved Application’ page, you will be able to access a form that you must fill and submit within 15 days. The form has 10 sections, so once you open it, be sure to fill in details in each section and affix scanned copies of your bank account number, IFSC code, proof of business incorporation, etc.
- Next, fill out the enrolment form. Once again, take care to provide information for all fields that are marked mandatory. Then, click on ‘Save and continue’. Similarly, fill in details that are mandatory as listed under the ‘businesses and ‘Promoters/ partners’ tab while providing proof of constitution.
- Lastly, provide information under the ‘authorised signatories’ section. If you are keen on e-signing the form, make sure to use the signatory’s mobile number and email ID. Similarly, to sign via DSC, ensure that the signatory’s PAN is linked with DSC.
- Then, continue to fill the rest of the tabs, namely ‘primary place of business’, ‘goods and services’, ‘Bank accounts’, etc. using data from relevant documents such as the first page of a passbook or bank statement and proof of primary place of business.
- An important aspect is to sign your application via e-signing, DSC or EVC digitally. This is compulsory for companies and LLPs, and the signature of the authorised signatory, as stated in the registration form, must be used. You can then submit your application.
- You will receive an Application Reference Number or ARN on your mobile number and email ID shortly after to help you track your application.
- Once the GST officer approves the application, you will be assigned a unique GSTIN for your business. You will receive a notification via email and text message. You will also receive a temporary username and password that you can use to log in. Once you do, click on ‘First Time Login’ to create your username and set a new password.
- After three to five days have passed, you can download your registration certificate by navigating to the ‘services’ tab. Click on ‘user services’ and then on ‘view or download certificates’ to do so.
There is a two-step verification process for businesses to complete the GST registration. Once the GST officer approves the application, you will be assigned a unique GSTIN for your business.
What is the cost of obtaining GSTIN?
Obtaining a GSTIN (Goods and Services Tax Identification Number) is free of cost. The government does not charge any fees for GST registration, which can be done online through the official GST portal. However, businesses may incur costs if they choose to hire professionals or consultants to assist with the registration process, as these services might involve fees. While the registration itself is free, maintaining compliance with GST regulations may require ongoing costs related to filing returns, accounting, and auditing, depending on the size and nature of the business.
How to do a GST number check?
Checking the validity of a GST number (GSTIN) is a simple process that ensures the authenticity of businesses. Here's how you can do it:
- Visit the GST Portal: Go to the official GST website.
- Navigate to search taxpayer: Click on the "Search Taxpayer" option under the "Search" tab.
- Enter GSTIN: Input the 15-digit GSTIN in the search box.
- Submit: Click on the "Search" button.
- Verify details: The portal will display the business details associated with the GSTIN, allowing you to confirm its validity.
This quick check helps in ensuring compliance and avoiding fraudulent transactions.
Benefits of getting a GSTIN
- Legal recognition of the business entity as a supplier of goods or services, aiding in attracting more customers and fostering business growth.
- Increased competitiveness compared to smaller businesses, as purchasing from you allows for input credit.
- Ability to claim input credit on own purchases and services, enhancing financial benefits.
- No restrictions on interstate sales, expanding the potential market for SMEs.
- Opportunity to register on e-commerce platforms or establish own e-commerce website, further broadening business scope.
- Ensured compliance through GST registration, resulting in a favourable GST rating and facilitating business expansion.
Documents required for GSTIN number
To obtain a GST number or GSTIN, you must submit the following documents along with your application:
- PAN Card: This should include the PAN for the business entity (company PAN for companies, etc.) and the PAN of the authorized signatory (individual PAN).
- Business Constitution: Documents such as the partnership deed, registration certificate, memorandum of association, and articles of association.
- Identity and Address Proof of Promoters/Directors/Partners: Acceptable documents include an Aadhaar card, passport, voter ID card, etc.
- Proof of Principal Place of Business: This can include a property tax receipt, electricity bill, or rent agreement that reflects your business address.
- Bank Account Proof: A cancelled cheque or bank statement that contains the details of the business bank account.
- Signed Authorisation Form: This grants permission for a designated individual to act as your authorized signatory for GST purposes.
- Photographs: Recent photographs as required.
How to spot a fake GSTIN?
Be cautious of fake GSTINs that dishonest entities may use to evade taxes or defraud customers; follow these steps to verify:
- Visit the GST portal.
- Click on the "Search Taxpayer" tab on the homepage.
- Choose the "Search by GSTIN/UIN" option and input the GSTIN you wish to verify. Enter the captcha code if prompted.
- Click on the "Search" button. If the GSTIN is valid, relevant information will appear on your screen.
Some consequences of issuing or dealing with fake GSTINs include:- Loss of input tax credit, which can increase your tax liability and decrease your profits.
- Potential penalties of up to 100% of the tax amount involved, along with imprisonment of up to five years.
- Damage to your reputation and goodwill in the market.
How is GSTIN different from GSTN?
GSTIN | GSTN |
A GSTIN is a special 15-character code made up of both letters and numbers. This code is given to every business that registers under the GST system in India. | GSTN stands for Goods and Service Tax Network. It is an organisation responsible for managing the IT system of the entire GST portal. |
Every GST taxpayer must have it. It is used to identify, track, and verify the tax transactions and compliance of taxpayers. | It is a non-profit, non-government company providing services related to the GST system to the government, taxpayers, and other stakeholders. |
It consists of the state code, PAN, entity code, default character, and check digit. GSTIN can be verified online through the GST Portal. | GSTN is in charge of creating, maintaining, and running the GST portal, which is used for registration, filing, payment, and refunds of GST. It also helps share data between central and state tax authorities and other agencies. |
