Goods and Services Tax (GST) is the tax that you have to pay to the Government to sell your products and services in India. Before 2017, there were different varieties of taxes like sales/VAT tax, tax, etc. merchants have to pay to the Government for selling via online and offline platforms. After a long battle, now, India has a dedicated single tax system, the rate of which varies for the product types and product categories.
Is GST registration compulsory for online selling?
GST registration is mandatory for everyone who is planning to sell products online. Suppose you plan to start selling on marketplaces like Amazon, Flipkart, eBay, Snapdeal, and many others, you have to feed your GST number unless you are selling books. At the GST regime launch in 2017, all the businesses with the annual turnover of 20 Lakh and above need to register for GST registration. CBIC’s notification further stretched this limit to 40 Lakh in the preceding financial year, effective since 1st April 2019. Service-based businesses still have a slab of 20 Lakh, irrespective of your mode of business conduction.
If you are running a brick and mortar store and have your annual turnover of less than the stated limit, GST registration is not mandatory. As far as you plan to expand to the next level, you have to get your business registered according to the GST Act. The merchants who have their branches in different states need to register for different GST numbers in different states. You must take this thing in the account that we are talking about businesses selling from different states. With a unique GSTin of your business based on one location, you can sell the products across all states and union territories in India.
What is the GST process? Is GST registration free?
The youthpreneurs and budding businesses may feel like this tax registration is a lot of mess and will be troublesome, but, believe me, it’s not!
GST registration is totally free!
Yes, you read it right. If you have a bit of technical knowledge and starting your business as a sole proprietor, you can visit GST’s official website and register on your own. For ease of understanding, check the tutorial videos and go through the supporting material. You can complete the first step of registration by feeding your mail address, functional mobile number, and basic business details.
Those of you are planning to start your ecommerce business as partners or in any other company architecture; then, you need the help of GST practitioners or tax consultants. If you already know the Chartered Accountants in your vicinity, you can connect with them for company registration, and once that’s done, you can parallelly align your GST registration. Here, you will be charged with the 3K-10K for all the registration procedures. The fees depend upon the tax firm or CA you are consulting with. If you don’t know any professional persons to help you, you can find the GST practitioners’ list on GST’s official portal.
When you are handling the registration procedure on your own, it will take 15-30 days. However, with the help of professionals, you can get the procedure completed within a week for a proprietorship firm and 15 days approx for registration of other company types.
How much will GST be charged on my products?
The percentage of GST levied on the products that you will be selling via your store varies from 0% to 28%. Like books, there are certain goods exempted from the category of GST. For the rest of all the categories, you need to refer the list of Harmonized System Nomenclature(HSN) codes to check the tax rate.
While getting GST certification for your business, you have to mention the products that you will be dealing with. You can refer HSN codes from there to get the exact percentage of GST charged. There are slight variations in the GST law for different states. If you want to gain insights about the same for your state, you can refer to the GST Law on GST’s official website.
How can I update GST rates for my products on Builderfly?
If you do not have the GST updated for the products listed at your store, you have to get manual calculations. That’s a tedious job, and we don’t want you to take that trouble. Builderfly lets you update the tax rules and tax rates for the countries you are selling in. Follow the steps below:
- Log in to your Buidlerfly account.
- From your Builderfly dashboard, click on Manage Store.
- Select Settings on the left side panel and click on Tax.
- Here, you will get the options to update Tax Rules, Tax Rates, Import/Export Tax Rates, and Tax Classes.
The merchants dealing in a variety of products via their Builderfly store have varying tax rates for different products. If you are one of them, you can click on import/export tax rates, update tax rates in an excel sheet and upload a .csv file. The tax rules and corresponding tax rates will reflect in the ‘Tax Zones & Rates’ section.
Further, if you want to create a distinct tax class based on which you like to group your website audience and potential customers, you can do it by clicking on ‘Tax Classes’.
For all the ecommerce enthusiasts out there, GST is mandatory. But, this doesn’t mean that you can’t take a step without GST registration. If you already have the products with you, start with the social selling options. Share it with your friends and acquaintances, create a listing for free on the Facebook Marketplace and on other social channels to create the buzz about your product/services.
Take your next step in building your brand by registering your business at Builderfly. You need not update your GST number during registration, so you can register your application for GST and start building your website straight away. With our intuitive design editor, you can design and customize your store on your own. Refer to our step-by-step user guide to build your store and mobile application with the help of our DIY editor layouts. For any information, feel free to write to us at support@builderfly.com.
