Goods and Services Tax Identification Number (GSTIN), , consists of a distinct 15-digit identification code allotted to each taxpayer registered under the GST regime.
- The first two digits represent the state code according to the Indian Census of 2011. Every state or union territory has a unique code. For example, 27 stands for Maharashtra and 08 for Rajasthan.
- The next ten digits are the PAN Number of the taxpayer or business house.
- The 13th digit indicates the number of registrations in a state for the same PAN. It is alpha-numeric (first 1-9 and then A-Z).
- The 14th digit is the alphabet ‘Z’ by default.
- The last digit is a check code to detect errors. It can be an alphabet or a number.
The government has made it mandatory for businesses with an annual turnover exceeding Rs. 20/40 lakh to have a GSTIN. If you are a registered dealer, you need to file GST returns and pay if GST liability exists. Also, if the GST you pay is more than the GST liability, you can claim a refund through your GSTIN.
Features of GSTIN
- Legal Compliance: GSTIN is mandatory for businesses with an annual turnover above the threshold limit prescribed by the GST law. It ensures legal compliance with GST regulations.
- Input Tax Credit (ITC): Businesses use their GSTIN for claiming Input Tax Credit (ITC) on taxes paid on inputs and input services used in the course of business.
- Invoice Generation: GSTIN is used for issuing GST-compliant invoices for the supply of goods or services. It helps in proper tax invoicing and documentation.
- Online Verification: GSTIN can be verified online through the GST portal or other authorized platforms. This helps in validating the authenticity of a GSTIN provided by a taxpayer.
GSTIN plays a pivotal role in the GST regime, serving as a unique identifier for taxpayers and facilitating seamless tax administration and compliance. It streamlines tax procedures, enhances transparency, and fosters the smooth functioning of the GST system in India.