GSTIN Number

GSTIN, or Goods and Services Tax Identification Number, is a 15-digit alpha-numeric code that your firm gets after being registered under the GST regimen of India. If the annual turnover of your business exceeds the threshold limit or the firm does inter-state business, you should mandatorily apply for the firm’s GSTIN. 

GSTIN number is a 15-digit code representing several particulars about the business, including its PAN number, state of business, etc. Following is the breakdown of the GSTIN structure:

• First two digits indicate the state where the business is located.

• Following ten digits are the PAN number of the business or its owner.

• Next digit is the entity number under the same PAN number.

• The 14th number is ‘Z’ by default.

• The last number is a check code that helps in detecting errors.

Here is why it is important to have a GSTIN number for your business:

• Getting input tax credit: Every time you purchase raw ingredients/equipment or avail a service for your organisation, you must pay GST or input tax credit (ITC). However, after selling your manufactured products, you can balance your paid ITC with the output tax given by your customers. This way, the ITC saves you from double taxation. You will not be able to get this benefit if your firm does not have GSTIN.

• Restriction-free sales within the country: For interstate sales of your products or financial transactions, you need to have a GSTIN number. This is why it becomes extremely important to have a GSTIN if you are looking to scale up your business.

• GST returns: According to the GST Act, you must file GST returns, including GSTR-1, GSTR-3A, GSTR-9, etc., in a timely manner. During the application process, you need to submit your firm’s GSTIN. This number helps the government to get the necessary details about your services or products.

Besides these, GSTIN also helps function as legal recognition of your business. You can use this record as lawful proof of your business ownership.

As an alternative to the online application process, you can also visit GST Seva Kendra to get the GSTIN. The Indian Government has founded several local GST offices to make registration easier and help residents with GST-related challenges. To register your business for GST, you need to visit your nearby GST Seva Kendra and ask for the offline application form. Then, you will have to submit the duly filled application form with all the necessary documents.

You can check whether a GSTIN is authentic by undergoing the following steps:

• Step 1: Visit the GST portal.

• Step 2: Click on ‘Search Taxpayer’.

• Step 3: Enter the GSTIN number.

• Step 4: Enter the CAPTCHA code.

Upon completing these steps, you will get the GST registration details of the business on your next screen only if the GSTIN is valid. Following are the details you will be able to see on your screen after completing these steps:

• Status of business (active/inactive)

• Legal name

• Date of registration 

• Structure of the business

If the GSTIN is not authentic, you will see an ‘error’ message.

The meaning of GSTIN and GSTN can be confusing at first. In fact, both these are related to GST. GSTIN refers to the registration number of your taxpaying organisation.

Contrarily, GSTN or Goods and Services Tax Network is an IT infrastructure that oversees the portal of GST. It helps all the stakeholders associated with GST, including state and central governments, taxpayers, etc., to get successfully synchronised with this singular indirect taxation. It also helps the government to track financial transactions within the country.

So, if you are running a business, you should ideally register your enterprise under the GST rule, especially if its annual turnover is over a certain threshold amount. After registration, you get a 15-digit GSTIN which you should mention in your GST invoices. With the help of this number, you can ensure that the government gets the right amount of input tax from your end. Besides this, GSTIN is an important identifier of your business. This is why it can also help your business establish its credibility in the market.

As a customer of a business, you can claim the benefits offered by GSTIN only if the business provides you with an authentic number. There have been multiple instances where businesses have provided their customers with fake GSTIN numbers. 

Through such unethical practices, the businesses collect tax under the pretext of GST and don’t submit the same to the government. Therefore, it is important to verify the GSTIN of a business to ascertain the veracity and authenticity of the number before purchasing goods or services from them.