On 1 July 2017, the Government of India launched a unified tax-collecting scheme for the whole nation, popularly called GST (Goods and Services Tax). The motive was to remove all other indirect taxes like the Excise and Customs duties, Service Tax, VAT, etc. It aimed for the narrative ‘one nation, one tax, one market’. GST made compliance easy, removed tax cascading, and improved competitiveness in the market.
With so many benefits, many firms registered their domain under the GST system and obtained a unique code known as the GSTIN number. This number consists of 15 digits and is unique for every firm. Under the GST regime, firms can avail themselves of many of the above-mentioned benefits.
This article introduces you to the meaning and significance of GSTIN, its benefits, and the process to get a GSTIN number for your business.
What Is the GSTIN Number and What Is Its Significance?
GST Identification Number is a unique 15-digit code that is given to every business body upon registering under the GST system. It is a replacement for the Tax Identification Number, which was given to firms by the state under the VAT system.
Each taxpayer is given this state-wise, PAN-based number. Under GST, all the millions of taxpayers are consolidated under one system. According to census data, more than 8 million taxpayers shifted from various taxation systems to GST and were given a GSTIN number.
What Is a GSTIN Number Made up of?
The 15 digits of a GSTIN number are made up of various sources like the PAN (Personal Account Number), state code, etc. Here is how all these digits make up the GSTIN:
- First two digitsThe first two digits of the GST number show the state code. Every state or union territory has its unique two-digit code. For example, the state code of Telangana is 36 and that of Odisha is 21.
- Following 10 digitsAfter the first two digits, the following 10 digits are the taxpayer’s PAN number.
- The thirteenth digitThe thirteenth digit of the GSTIN number is the number of registrations in the state for the same PAN number. This is an alpha-numeric character, consisting of a number and an alphabet.
- The fourteenth digitThe fourteenth character of the GSTIN number is the alphabet z by default.
- The last digitThe last digit of the GSTIN is a random code to detect any errors. This can be either an alphabet or a number.
How to Apply for GST and Get Your GSTIN Number?
You can get a GSTIN number by registering for GST, which is an easy, free-of-cost process. The steps for registration are as follows:
- Log in to the GST portal of the Government of India and click on the ‘Services’ tab.
- Now click on ‘Registration’ and then hover your cursor over ‘New Registration’ to register yourself for GST.
- A new application form pops up in which you have to fill in all your details. You have to enter both your email ID and your phone number, as you will receive an OTP on both of them.
- After clicking on proceed, the portal asks for the OTPs sent to your device. Fill in the OTPs within 10 minutes, failing which you will have to redo the entire process.
- The screen now shows you a Temporary Reference Number (TRN) that you should note down. Head over to the home page again and click on ‘New Registration’.
- Now, instead of re-entering your details, you have to enter your TRN number and a captcha that follows the process.
- Now you can go to the ‘My Saved Application’ page. Here, you will find a form that you should fill in within 15 days. This is a long form, with 10 sections asking for all your details like KYC, business proof, etc. You also have to submit copies of all these documents at every respective section.
- Now, you have to fill in the enrollment form and click on ‘Save and Continue’ to further the process.
- You have to provide details under the ‘Authorised Signatory’ section. Fill in the rest of the information under ‘Goods and Services’, ‘Bank Accounts’, etc.
- You should also sign your application with an e-signature or via EVC or DSC for many companies and LLPs. After you submit the application, you will receive an Application Reference Number or ARN on your mobile number and email ID.
Once the GST officer verifies all your documents and gives approval, you will get your GSTIN number on your email ID or mobile number. You can also use the GST number search tools or visit the GST portal and enter your PAN card details to find your GSTIN.
What are the Benefits of Having a GSTIN Number?
Having a GSTIN number has many perks, some of which are
- GST BenefitsThere are many GST benefits that taxpayers and firms can avail of by registering for GST and getting their GSTIN number. These benefits include lower taxes for small businesses, removal of cascading tax, etc.
- Refund ClaimYou can check your GST tax through your GST file returns. If you have paid more GST than your liability, you can use your GST number to claim a refund.
- Availing of LoansYou can also apply for a business loan using a GSTIN number.
A GSTIN number is a unique code that acts as your address in the GST regime. You can apply for a GST number using both online and offline modes. Having a GSTIN number gets you many benefits under the GST system and helps you avail yourself of business loans.
If you have more queries regarding GST, GSTIN number, taxation rules and regulations, tax planning, or any other finance-related topics, you can visit Piramal Finance. Make sure you also check out all the other financial products and services offered by them.