TAx IQ Beings a series of Notes on GST as a part of Education Series :-
To Start with :-
TAXABLE PERSON UNDER GOODS AND SERVICE TAX (GST) ACT
Taxable Person means a person who carries on any business at any place in India and who is registered or required to be registered under Schedule III of GST ACT (here after called “the Act”)
Now let us see what Schedule III says:
Schedule III is talking about registration under the act. Some brief highlights of Schedule III are:
1. Every supplier shall be liable to be registered under this Act in the State from where he makes a taxable supply of goods and/or services.
Registration is not required in the following two cases:
• If aggregate turnover of supplier in a financial year is less than or equal to Rs. 9 lakhs. Limit of 9 lakh is reduced to Rs. 4 lakhs for NE States including Sikkim.
Therefore small suppliers are exempt from registration
• If aggregate turnover exceeds 9 lakhs in a financial year and supplier is supplying goods/services which are not liable to tax
Supplier supplying exempt goods/services are not required to register
– The taxable threshold shall include all supplies made on his own account or made on behalf of all his principals.
– The supply of goods, after completion of job-work, by a registered job worker shall be treated as the supply of goods by the “principal” and the value of such goods shall not be included in the aggregate turnover of the registered job worker.
The above exemption is available to a REGISTERED Job worker only
2.If a person is already registered or holds a license under an earlier law, he shall be liable to be registered under this Act
3. The following categories of persons shall be required to be registered under this Act without any applicability of threshold limit:
(i) persons making any inter-State taxable supply
(ii) casual taxable persons(taxable person who occasionally undertakes transactions in taxable territory but does not have any permanent place of business in taxable territory)
(iii) persons who are required to pay tax under reverse charge
(iv) non-resident taxable persons( taxable person who occasionally undertakes transactions
but who has no fixed place of business in India)
(v) persons who are required to deduct tax under section 37;
(vi) persons who supply goods and/or services on behalf of other registered taxable persons whether as an agent or otherwise,
(vii) input service distributor;
(viii) persons who supply goods and/or services, other than branded services, through
electronic commerce operator
(ix) every electronic commerce operator
(x) an aggregator who supplies services under his brand name or his trade name,
(xi) such other person or class of persons as may be notified by the Central Government or a State Government
FOLLOWING ARE NOT COVERED IN THE DEFINITION OF TAXABLE PERSONS:
1. Agriculturist- Person who cultivate land personally, for the purpose of agriculture. Dairy farming and poultry farming is not covered under agriculture. So its taxable
2. Supplier whose aggregate turnover in a year does not exceed 10 lakhs. Limit is reduced to 5 lakhs for NE states including Sikkim
The above clause is applicable to the suppliers who are required to be registered under point 1 mentioned in Schedule III.
Therefore supplier is required to register once aggregate turnover exceeds 9 lakhs but taxability will start once the aggregate turnover exceeds 10 lakhs
3. Person providing services as an employee to his employer
4. Persons supplying exempt goods and services.
If the person is supplying both exempt and non exempt goods and services, then he is a taxable person. It means exclusively exempt goods and services should be supplied for this clause
5. Persons liable to pay tax under reverse charge. They are exempt only if the person receive services for personal use upto a specified amount. Services received for business purpose or furtherance of business are not exempt