Is GST mandatory for FSSAI? Know in Details

GST (Goods and Services Tax) is a value-added tax that is imposed on goods and services sold in India. The Government of India collects GST and they fund this tax to develop public services and infrastructures of the country. Goods and Service Tax applies to almost 90% of the businesses in India which also includes any kind of food businesses that are registered with the Food Safety and Standards Authority of India (FSSAI).

Now let’s look at some important aspects regarding the requirement of GST in FSSAI:

• All food businesses that have an annual turnover of Rs.40 Lac is mandatory to have GST registration. If any business owner wants to register their food business under GST they can register if also they don’t have an annual turnover of 40 Lac.
• FSSAI and GST are two different processes a food business should comply with. There are some similarities between the two regarding the documentation, like Address proof, Bank Details etc.
• There are some exemptions for GST for small food businesses. Food businesses not having an annual turnover of Rs. 20 lac are not required to register with GST. However, those food businesses that are registered with FSSAI should comply with GST registration if their turnover exceeds RS.40 lacs.

If you don’t register your food businesses that crosses the annual turnover of RS. 40 lacs to GST then you can face hefty penalties. The government of India has published a notification regarding the fees and penalties of food businesses registering for GST.

The order that is mentioned above came into effect on 18th July 2022, as per direction from the Ministry of Finance, Department of Revenue vide notification number 04/2022 and was approved by the competent authority.

Now a question can come into your mind whether only Food business owner needs to apply for GST or every business owner should have GST,

Let us clarify that for you,

Any business having an annual turnover of RS. 40lacs or more should register for GST, and this is mandatory. The individuals that are mentioned below must have GST registration to run their businesses hassle-free.

• Any individual who is conducting a supply of taxable goods and services from state to state.
• Individuals who fall under the reverse taxability charge
• Any individuals who are non-residents but fall under the taxable slab
• Any individuals who fall under the tax deduction according to sec 37
• All business owners who operate their businesses in an e-commerce sphere.

Know the Documents required for GST Registration:

• PAN Card (Permanent Account Number)
• Identity proof
• Photos
• Address proof of the business
• Business Registration Proof
• Bank Account Statements

Keep the documents handy, we are moving towards the GST registration Process:

GST Registration Procedure:

Keep the Documents that are mentioned above with you:

• PAN Card
• Aadhar card
• Business Registration Document
• Details of Bank Account

Fill up the GST Registration Form

GST registration form comes into two types:

• REG-01
• REG-07

The form REG-01 is for companies those are having annual turnover of more than Rs. 20 Lacs.

Form REG-07 stands for companies those who are having turnover of less than Rs. 20 Lacs.

Now, fill up the form following your needs and the turnover of your business.

Verification: 

After filling up the form, verify the following details,

• E-mail Address
• Phone number (by submitting the OTP you receive)
• After validating the email ID and phone number you will receive an ARN (Application Reference Number) number.

Document Submission:

After getting the ARN, you have to submit the necessary documents within 15 days.

Application Approval:

After completion and submission of the necessary documents, the concerned GST officer will review your GST application. If the officer finds any discrepancies regarding the documents then he/she will ask you for clarification.

GST Certificate:

After successful completion, you will get the GST certificate having a unique GSTIN (GST identification Number). This number should be printed on every bill and invoices which are used for any kind of GST transaction.

Benefits of GST registration:

Increase Credibility for Business: Getting registered for GST can boost your company's legality and reputation, particularly if you are doing business with other firms or clients that want you to be registered. It proves that your business is a legitimate, knowledgeable enterprise that abides by regional tax laws. When you register for GST, you can also claim input tax credits on your business expenses, which can improve your cash flow and reduce your tax liability.

Claiming input Tax Credits: Once a business has registered for GST, it is required to charge and collect GST from its clients on taxable supplies. Input tax credits (ITC) for the GST the company has paid on its outgoings are still allowed. Because of this, the government would permit you to request a credit against the GST you paid on outputs like sales, for the GST you paid on inputs like goods, supplies, and services. A company's cash flow can be improved and its overall GST liability can be decreased by having the capacity to submit ITC claims.

Enhance Competition in the market: Furthermore, filing for GST might increase a business's competitiveness in the market. The business may compete on an equitable playing field with other registered businesses because it is mandated by law to charge GST on taxable supplies. Additionally, having a GST registration can give a firm the appearance of being well-established and professional to suppliers and customers, which can improve its reputation and attract new business. Ultimately, this could lead to increased revenue and sales.

Help to reach a wide range of customers: Another advantage of registering for GST is having access to a wider customer base. As numerous firms and governmental bodies are mandated to exclusively collaborate with registered suppliers, registering for GST may open up new avenues for business with these clients. Furthermore, because registered corporations can provide a better level of comfort that the business is functioning lawfully and in line with tax requirements, some clients may prefer doing business with them. This could help a business increase both its clients and its revenue.

Tax Compliances Simplified: Businesses may find it simpler to abide by tax regulations with the help of GST registration. The GST is a comprehensive tax that aims to replace all indirect taxes, simplifying the tax structure for businesses. A business that registers for GST is required to provide the taxing authority with regular GST returns. These filings include a summary of the GST that the business has incurred, paid, and claimed in input tax credits. Regular submission of GST returns by a company allows it to keep an eye on its GST due and ensures that it is in compliance with tax legislation. Furthermore, several countries provide businesses with online tools and services to help them handle their GST compliance obligations.

Entitled to get Certain Government schemes:

In several nations, a business that registers for GST is also eligible for particular government benefits and initiatives. For example, several nations provide GST credits or refunds to eligible businesses, which can assist in reducing the overall tax burden on the company. Furthermore, several government procurement programs require sellers to register for GST, which could lead to new business opportunities. A company that is GST-registered may also qualify for a number of small business-specific tax exemptions and incentives, which can reduce costs and increase revenue.

Conclusion: Lastly, it has been established that every food business that has an annual turnover of 40 lacs is mandatory to have GST registration. There is no such exemption that you have an FSSAI license, hence a GST certificate is not required. FSSAI and GST both are separate and fulfil the demands of their respective fields. If you still have some confusion, contact Online Legal India as we have the best and vastly experienced experts who have catered to a lot of clients till now. Most of the Clients are happy with the services they got from us.