The short version
- Thresholds are ₹40 lakh for goods and ₹20 lakh for services in most states.
- Sellers of goods across states and sellers through e-commerce operators must register regardless of turnover, with some exceptions.
- Registering voluntarily lets you claim input tax credit, but you must then file returns.
Turnover thresholds
Under the CGST Act, a supplier of goods must register once aggregate turnover in a financial year exceeds ₹40 lakh. For services, the threshold is ₹20 lakh.
A few states, mostly in the north-east, have lower limits.
When turnover does not matter
Section 24 of the CGST Act requires registration, whatever your turnover, if you are:
- Making interstate taxable supplies of goods.
- Supplying through an e-commerce operator, with some exceptions for small service suppliers.
- A casual or non-resident taxable person.
- Required to pay tax under reverse charge.
- An input service distributor.
Registering early
B2B businesses often register before they reach the threshold. It lets them claim input tax credit on purchases and meet client onboarding rules. Once registered, returns are due every month or quarter, even with no sales.
This guide is general information, not legal or tax advice. Rules and fees change often, so check with an advisor before you file anything.