Applicability & registration of gst
This query is : Resolved
22 May 2017
I am Financial Consultant( an Masters in Finance), currently working on monthly contract basis for fixed monthly contracted service charges of 90K(-) TDS for an Indian entity.I work from my Home for my principal. Such type of Contract is not permanent and I may switch to regular Job upon having better opportunity. Being under this contractual assignment,...
My query is:
01 Am I Required to obtain GST Registration if I continue to work for my present principal even after GST rolls out ?
02 Currently I submit my monthly Bill and receive payment after deduction of TDS. What shall be status of my charging the Service Charges and receipt of payment.
I need guidance as I have to submit certification to my principal to process my renewal.
Please guide.
My query is:
01 Am I Required to obtain GST Registration if I continue to work for my present principal even after GST rolls out ?
02 Currently I submit my monthly Bill and receive payment after deduction of TDS. What shall be status of my charging the Service Charges and receipt of payment.
I need guidance as I have to submit certification to my principal to process my renewal.
Please guide.
24 May 2017
Dear Experts,
Please advise in the matter.
Regards
Please advise in the matter.
Regards
14 July 2024
Based on the details provided regarding your contractual arrangement as a Financial Consultant, here’s the guidance on the applicability of GST registration and the status of your service charges and payments:
### GST Registration Requirement:
1. **Applicability of GST Registration:**
- As a Financial Consultant providing services to an Indian entity, GST registration may be required under the following conditions:
- **Threshold Limit:** If your aggregate turnover of taxable services exceeds Rs. 20 lakhs (Rs. 10 lakhs for special category states) in a financial year, GST registration is mandatory.
- **Interstate Supply:** Regardless of turnover, if you provide services from one state to another (e.g., if your client is in a different state than your place of residence), GST registration is mandatory.
2. **Your Situation:**
- Since you are providing services on a monthly contract basis for a fixed fee of 90K (minus TDS), if your aggregate turnover exceeds the threshold limit or if your services are interstate, you would need to obtain GST registration.
- Even if you currently do not exceed the threshold, it's advisable to monitor your turnover regularly, especially as GST rules may change over time.
### Status of Service Charges and Payment:
1. **Charging Service Charges:**
- You should continue to invoice your client for the fixed monthly service charges of 90K (minus TDS).
- Ensure that your invoices comply with GST requirements (if applicable), including details such as GSTIN (if registered), HSN/SAC codes, and other necessary information.
2. **Receipt of Payment:**
- Your client currently deducts TDS from your payments. Under GST, TDS (Tax Deducted at Source) is separate from GST.
- TDS deduction will continue as per income tax rules, and you will receive net payments after TDS deduction.
### Guidance for Certification:
- To process your renewal or certification with your principal, ensure that you communicate your GST registration status clearly:
- If registered: Provide your GSTIN and comply with GST invoicing requirements.
- If not registered: Clarify your exemption status (if applicable) or readiness to register if the turnover exceeds the threshold.
### Next Steps:
- **Monitor Turnover:** Regularly assess whether your turnover exceeds the GST threshold to determine if registration becomes mandatory.
- **Consultation:** For specific advice tailored to your circumstances and to ensure compliance with GST regulations, consider consulting with a tax advisor or GST consultant.
By proactively addressing GST requirements and maintaining clear communication with your client, you can ensure smooth continuation of your contractual arrangement.
### GST Registration Requirement:
1. **Applicability of GST Registration:**
- As a Financial Consultant providing services to an Indian entity, GST registration may be required under the following conditions:
- **Threshold Limit:** If your aggregate turnover of taxable services exceeds Rs. 20 lakhs (Rs. 10 lakhs for special category states) in a financial year, GST registration is mandatory.
- **Interstate Supply:** Regardless of turnover, if you provide services from one state to another (e.g., if your client is in a different state than your place of residence), GST registration is mandatory.
2. **Your Situation:**
- Since you are providing services on a monthly contract basis for a fixed fee of 90K (minus TDS), if your aggregate turnover exceeds the threshold limit or if your services are interstate, you would need to obtain GST registration.
- Even if you currently do not exceed the threshold, it's advisable to monitor your turnover regularly, especially as GST rules may change over time.
### Status of Service Charges and Payment:
1. **Charging Service Charges:**
- You should continue to invoice your client for the fixed monthly service charges of 90K (minus TDS).
- Ensure that your invoices comply with GST requirements (if applicable), including details such as GSTIN (if registered), HSN/SAC codes, and other necessary information.
2. **Receipt of Payment:**
- Your client currently deducts TDS from your payments. Under GST, TDS (Tax Deducted at Source) is separate from GST.
- TDS deduction will continue as per income tax rules, and you will receive net payments after TDS deduction.
### Guidance for Certification:
- To process your renewal or certification with your principal, ensure that you communicate your GST registration status clearly:
- If registered: Provide your GSTIN and comply with GST invoicing requirements.
- If not registered: Clarify your exemption status (if applicable) or readiness to register if the turnover exceeds the threshold.
### Next Steps:
- **Monitor Turnover:** Regularly assess whether your turnover exceeds the GST threshold to determine if registration becomes mandatory.
- **Consultation:** For specific advice tailored to your circumstances and to ensure compliance with GST regulations, consider consulting with a tax advisor or GST consultant.
By proactively addressing GST requirements and maintaining clear communication with your client, you can ensure smooth continuation of your contractual arrangement.
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