GST · Registration and basics
Do online sellers and businesses making inter-state supplies need GST registration below the threshold?
Short answer
Sellers of goods through e-commerce platforms must register whatever their turnover. The exception, since 1 October 2023, is small sellers of goods within their own state, who can sell through an e-commerce operator with only a PAN-based enrolment. Inter-state supply of goods needs registration from the first rupee. Service providers below the threshold need not register, even for inter-state or online supplies, except for services on which the platform pays the tax.
Who must register regardless of turnover
| Situation | Registration |
|---|---|
| Inter-state supply of goods | Compulsory, from the first sale (except notified handicraft goods) |
| Goods sold through an e-commerce operator that collects TCS | Compulsory, unless the seller uses the intra-state exemption below |
| Services through an e-commerce operator | Not needed if turnover is below the threshold |
| Inter-state supply of services | Not needed if turnover is below the threshold |
The threshold is ₹40 lakh for goods (₹20 lakh in some states) and ₹20 lakh for services (₹10 lakh in special-category states). See registration limits.
The small online seller exemption
Since 1 October 2023, a person below the threshold can sell goods through an e-commerce operator without GST registration if:
- the supplies are within the seller's own state;
- the seller has a PAN and takes an enrolment number on the GST portal; and
- the seller does not supply in more than one state through the platform.
Composition taxpayers can also sell goods through e-commerce operators within their state.
What the platform does
- The e-commerce operator collects TCS of 0.5% (0.25% CGST + 0.25% SGST, or 0.5% IGST) on net taxable supplies and files GSTR-8.
- The TCS appears in the seller's account on the portal and, once accepted, moves to the electronic cash ledger.
- For some services (passenger transport, accommodation, housekeeping, restaurant food), the platform itself pays the tax under section 9(5), and the supplier does not.
Place of supply
For goods sold to unregistered customers, the place of supply is where the goods are delivered, so a sale to a customer in another state is inter-state and carries IGST. Report state-wise B2C sales correctly in GSTR-1.
Legal basis
- Sections 22, 24 and 52, Central Goods and Services Tax Act, 2017
- Notification 34/2023-Central Tax (supplies of goods through e-commerce operators)
- Notification 65/2017-Central Tax (services through e-commerce operators)
Official sources
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