Is it Possible to use one PAN card for two GST registrations?

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The GST (goods and services tax) is a countrywide indirect tax levied on the supply of goods and services. GST has subsumed and replaced various indirect taxes. Such as service tax, central service tax, VAT, excise duty and so forth.

Also note that online GST return filing is a must which now stands as an all-inclusive indirect tax. The government of India introduced the CGST Act with effect from 1st of July, 2017.

As per section 25 (1) of the CGST Act, the business or individual entity must apply for GST registration in every state and union territory, where he/she is liable to register. This entire process of registration under this act is referred to as the GST registration. One can initiate the GST registration process online on the GST portal as well.

Significance of the PAN card.

As mandated in the income tax act, 1961, the PAN card is obligatory for all companies, individuals, partnerships, and non-profits and so forth.  Obtaining the PAN card online helps the company receive various invoices and remittances. Also, it is beneficial while submitting the IT returns. If you do not have a PAN card, you will not be able to obtain the tax benefits and benefits of schemes launched by the government. Additionally, you will have to pay taxes at the highest rate applicable in the country. Therefore, it is crucial for you now to obtain the PAN card online as soon as possible.

GST registration and PAN card.

The GST regime was launched with the bourn ‘one nation, one tax.’ GST wants to bring both direct and indirect taxes under the same roof. GST is the indirect tax by nature, and it is linked to the PAN card that is based on direct taxes.

Usually, an individual acquires only one GST registration in the India regardless of the state or union territory s/he operates in. If and only their business is within the boundaries of that state or union territory. But they operate in more than two states or UTs, then they are liable for GST registration in each of those states or UTs. For instance, if they are in the trading business and they trade in both Gujarat and Maharashtra. Then they will have to apply for the GST registration in both of these states.

For the same individual in a preceding instance, there will be two different GST numbers in two different states. But the PAN card will be the same that belong to him. And they can use it. This shows that two GST registrations are possible on one PAN card. This is the case where various GST registration is obligatory. Currently, one can link the GST numbers to a PAN card online.

Also, it is a matter of personal preference whether one wants to complete the two GST registrations with one PAN card. This happens when an individual operates multiple business verticals in the same state or union territory. In such case, they can choose to have GST registrations for each of these verticals separately, subject to meet the conditions stated in section 25 (2) of the CGST act.

Defining the business vertical.

As per section 2 (18) of the CGST act, 2017, it is a distinctive differentiable element of the business enterprise that is occupied in the supply of the individual goods or services or concerning goods and services. Also, the element is subject to possible returns and risks that are entirely distinct from other verticals of the business.

Here are the factors that decide whether the goods or services are relatable;

– The type of goods or services.

– The nature of production processes.

– The type or class of customers who are availing the goods or services.

– The methods of distribution of goods or supply of services.

– The nature of the statutory or regulatory environment. Including banking, insurance, or public utilities.

Crucial points that you should keep in mind while acquiring multiple GST registrations.

– Your business must meet the criteria as mentioned earlier of the business vertical.

– Also, you will not be able to get benefits of the composition scheme against the specific business vertical if any of your other business verticals are no longer eligible to pay tax under the composition.

– You will have to issue tax invoices or pay tax (as mentioned in the CGST Act) on the supply of services. Or goods betwixt your own registered business verticals.

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