GST Law provides for some safeguards and provisions to levy taxes on a person who doesn't have any permanent base for supplying goods or services or a foreigner who entered in taxable territory without any intention to stay in India for a long time with a fixed base to supply goods or services in India. Let's have a look on a brief of such provisions of GST law:
Section 2(20) of CSGT Act, defines 'Casual Taxable Person' as under:
'Casual taxable person' means a person who occasionally undertakes transactions involving supply of goods or services or both in the course or furtherance of business, whether as principal, agent or in any other capacity, in a State or a Union territory where he has no fixed place of business;
Section 2(77) of CGT Act, defines 'Non-resident Taxable Person' as under:
'Non-resident taxable person' means any person who occasionally undertakes transactions involving supply of goods or services or both, whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India;
First of all, we need to understand difference between 'casual taxable person' and 'non-resident taxable person'.
A casual taxable person is a person who:
- Has a normal GST registration in one/more than one of the states of India where he regularly supplies goods or services or both and has a fixed place of business in such state(s)
- Also supplies goods or services or both (occasionally) in other states where he doesn't have a fixed place of business as principal or agent or in any other capacity
A non-resident taxable person is a person who:
- Is a non-resident in India means who does not have a residence in India
- Doesn't have a fixed place of business in India
- Doesn't have even a normal/any type of GST registration in any place of India
- Supplies goods or services or both (occasionally) in any state/place of India as principal or agent or in any other capacity
Law doesn't define frequency of transactions which should be considered to decode the term 'occasionally', therefore reasonable frequency should be understood for the same.
Most of the provisions of GST law are same for Casual Taxable Person and Non-resident Taxable Person. Some of them are mentioned as under:
- They have to take registrations under GST law irrespective of threshold limit of turnover
- Application for registrations:
- Form GST REG-09 (for Non-resident Taxable Person)
- Form GST REG-01 (for Casual Taxable Person)
- They have to apply five days before commencement of business for registration
- Their registrations shall have validity for a term of ninety days or any shorter term as may be specified in registration certificate
- They may also apply for extension of their registrations in Form GST REG-11
- They are not eligible for composition scheme
- They can supply taxable goods or services or both only after obtaining registrations
Deposit of advance taxes
- They have to deposit their taxes in advance during the time of filing of registration application. Such deposit of advance tax shall be on an estimation basis.
- Advance taxes deposited by them shall be credited to their electronic cash ledger being maintained electronically and balances shall be utilized in prescribed manner
- Their advance taxes/balance of advance taxes shall be refunded only after completion of their operation period and compliance (filing of required returns)
These provisions are in place to ensure that no person may leave the state/country without paying indirect taxes (GST) on their income even.
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