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Voluntary Registration under GST


"Voluntary Registration" If any person who wants to obtain voluntary GST registration, can apply for GST registration, the threshold limit of Rs. 20 lakh for all states or 10 lakh for NE and hill states has increased to Rs. 40 lakh or Rs. 20 lakh in 32nd GST Council meeting at New Delhi on 10th January 2019. is not applicable to them. Voluntary registration is applicable for those who are not within the parameters of registration and are not required to register in the GST. 

If a small dealer may not be exceeding the limit but in case if he supplies his goods to a large dealer who is covered under GST and maintains accordingly then it will be the opportunistic side of the registrations, after voluntary registration brings, the dealer can avail the input tax credit on all the purchases and services availed by them.



If Mr. X, a small dealer with a turnover about to Rs. 18 lakhs during the year, it is not to be required to register him under GST. However, he is also supplying the goods to Mr. Y, who is registered under GST (having a turnover exceeding Rs. 40 lakh). Mr. Y is registered dealer and eligible for input credit and may look for a registered seller who can pass on ITC. In such a scenario, Mr. X might register voluntarily to pass on the benefit of input credit to his buyer called Voluntary registration.


Benefits of Voluntary Registration-
  • Input tax credit- Voluntary registered dealer can avail input tax credit on purchase of goods and services.
  • Inter-state sale- Voluntary registered dealer can make interstate sale of goods.
  • Better standing- Renting premises, availing loans from banks and other such business areas will become easier for businesses that are registered under the Goods and Services Tax due to a good compliance rating.
  • Issue Taxable Invoice- Voluntary registered dealer have to issue taxable invoice, so the buyer can avail input tax on purchase of goods.
  • Be complaint & have Good rating- Businesses that are registered under the Goods and Services Tax will be compliant as well as scalable. Moreover, the compliance rating that is maintained under the new regime shall be beneficial to the business as it can attract more customers.
Disadvantages of Voluntary Registration-
  • Filing of Returns- Voluntary registered dealer have to file 3 monthly returns and 1 annual return.
  • Tax burden- Voluntary registered dealer have to pay tax at higher rate as compared to unregistered dealer.
  • Cost increase- Voluntary registered dealer have to pay an extra charge for filing of returns or maintain books of accounts.
  • Compliance of GST provisions- Voluntary registered dealer have to fulfill their compliances of GST provisions, which increase the stress or burden of the dealer.


Voluntary Registration can now be cancelled before completion of one year! -

Any person who has taken voluntary registration but has not commenced business within six months from the date of registration will have his registration cancelled. Such cancellation will be done by –

  • a proper officer OR
  • requested by the concerned person himself *** OR
  • on an application filed by his legal heirs, in case of death of such person

***Taxpayers can now apply for Cancellation of Voluntary Registration before completion of one year.        


As per rule 20 of the central goods & service tax rules 2017 : Application for cancellation of registration.-A registered person, other than a person to whom a registration has been granted under rule 12 or a person to whom a Unique Identity Number has been granted under rule 17, seeking cancellation of his registration under sub-section (1) of section 29 shall electronically submit an application in FORM GST REG-16, including therein the details of inputs held in stock or inputs contained in semi-finished or finished goods held in stock and of capital goods held in stock on the date from which the cancellation of registration is sought, liability thereon, the details of the payment, if any, made against such liability and may furnish, along with the application, relevant documents in support thereof, at the common portal within a period of thirty days of the occurrence of the event warranting the cancellation, either directly or through a Facilitation Centre notified by the Commissioner.

See the related post : List of Revised GST Tax Rates


P. Vamsikrishnareddy on 8/1/2019 12:32:09 PM says:

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