Who Is Liable for GST Registration in India

Who is liable for GST registration is one of the most common questions asked by business owners, freelancers, and small traders in India. GST rules may look confusing at first, but once you understand who must register, things get much easier.

GST registration is not optional for everyone. Some people must register no matter what, while others are fully exempt.

In this informative blog, we will clearly explain who is liable, who is not, and why GST registration matters. The explanations are simple, practical, and based on current GST laws in India.

Understanding Who Is Liable for GST Registration

Who is liable for registration under GST depends on the nature of your business, your annual turnover, and where you operate from.

GST law defines specific categories of people who must register. These rules apply even if the business is small or newly started. In some cases, registration is required from day one.

Let us break this down step by step so it is easy to follow.

What Does “Person Liable for Registration Under GST” Mean?

A person liable for registration under GST is any individual or entity that meets the conditions set by GST law and is required to register on the GST portal.

The word “person” does not only mean an individual. Under GST, a person can be:

An individual or sole proprietor.
A partnership firm or LLP.
A company.
A trust or society.
A Hindu Undivided Family (HUF).
A government body or local authority

If any of these persons meet the GST criteria, registration becomes mandatory.

Turnover-Based Criteria: Who Is Liable for GST Registration

One of the main rules for determining who is liable for GST registration is annual turnover.

GST Registration Based on Turnover Limit

You must register for GST if your annual turnover exceeds:

₹40 lakh for goods suppliers.
₹20 lakh for service providers

For special category states, the limit is lower:

₹20 lakh for goods.
₹10 lakh for services.

Turnover includes all taxable supplies, exempt supplies, exports, and interstate supplies under the same PAN.

If your turnover crosses the limit even once, GST registration becomes mandatory.

Persons Liable to Register Under GST Regardless of Turnover

Some persons liable to register under GST must register even if their turnover is below the threshold limit.

These include:

Interstate suppliers of goods.
Casual taxable persons.
Non-resident taxable persons.
E-commerce sellers.
Agents supplying goods or services.
Input Service Distributors (ISD).
Persons paying tax under reverse charge.
Online service providers supplying from outside India.

In these cases, turnover does not matter at all.

Who Is Liable to Pay GST in India?

Who is liable to pay GST in India usually depends on who supplies the goods or services.

In most cases:

The supplier collects GST.
The supplier pays GST to the government.

However, the GST law also includes special situations.

Reverse Charge Mechanism (RCM)

Under RCM, who is liable to pay GST shifts from the seller to the buyer.

RCM applies when:

Services are taken from unregistered suppliers.
Services are provided by specific categories, like legal services or transport.
Goods or services are notified under RCM.

In such cases, the buyer must pay GST directly to the government.

Who is Liable to Pay GST Under Forward Charge

In the standard or forward charge system, those liable to pay GST are the registered sellers who supply goods or services.

It applies to:

Manufacturers
Traders
Service providers
Wholesalers
Retailers

They collect GST from customers and deposit it with the government after adjusting the input tax credit.

Interstate Supply and GST Registration Liability

Interstate supply is another important rule for determining who is liable for registration under GST.

If you supply goods from one state to another, GST registration is mandatory even if your turnover is low.

This rule applies to:

Online sellers
Wholesalers
Distributors
Importers and exporters.

For service providers, interstate supply does not always require compulsory registration unless notified.

E-Commerce Sellers and GST Registration

If you sell goods or services through platforms like Amazon or Flipkart, you fall under persons liable to register under GST.

It includes:

Online product sellers.
Online service providers.
Sellers using marketplace models.

Even if your turnover is small, GST registration is compulsory for e-commerce sellers.

Casual Taxable Person

A casual taxable person is someone who occasionally supplies goods or services in a state where they do not have a fixed place of business.

They must:

Register before starting a business.
Pay advance GST.
File GST returns.

Non-Resident Taxable Person

A non-resident taxable person supplies goods or services from outside India.

They are always treated as a person liable for registration under GST, no matter the turnover.

Who Is Not Liable for GST Registration?

Now, let us look at who is not liable for GST registration.

You do not need to register if:

Your turnover is below the threshold limit.
You deal only in exempt goods or services.
You supply non-taxable goods.
You are an agriculturist supplying produce from cultivation.
You provide services under notified exemptions.

These persons are legally exempt and do not need GST registration.

Exempt Supplies and GST Registration

If your business only supplies exempt items like:

Fresh fruits and vegetables.
Unbranded food grains.
Basic healthcare services.
Educational services.

Then you fall under those who are not liable for GST registration, even if turnover is high.

However, once you supply taxable goods or services, the exemption no longer applies.

Composition Scheme and GST Liability

Businesses under the composition scheme are still persons liable to register under GST, but with simpler compliance.

Key points:

Lower tax rates.
No input tax credit.
Limited interstate supply.
Fewer returns.

The scheme is ideal for small businesses that want less paperwork.

Who Is Liable to Pay GST When Goods Are Imported?

When goods are imported into India, the one who is liable to pay GST is the importer.

GST is charged as Integrated GST (IGST) along with customs duty. It applies to all imports, regardless of registration status.

GST Registration for Agents and Representatives

Agents supplying goods or services on behalf of others are also persons liable to register under GST.

It includes:

Commission agents
Brokers
Consignment agents

They must register even if their turnover is below the limit.

Importance of Knowing Who Is Liable for GST Registration

Understanding who is liable for GST registration helps you:

Avoid penalties and fines.
Stay legally compliant.
Claim input tax credit.
Build trust with customers.
Grow your business smoothly.

Missing registration can lead to heavy penalties and loss of business credibility.

How GimBooks Helps Businesses Stay GST Compliant

Managing GST can be stressful, especially for small businesses. And, this is where GimBooks makes a real difference.

GimBooks is a cloud-based, mobile-first bookkeeping and business management platform designed for small and micro-sized businesses in India and the Middle East.

It started as an easy invoice maker app to solve GST confusion and later evolved into a full GST-compliant invoicing and accounting solution.

With GimBooks, businesses can:

Create GST-compliant invoices.
Track sales and expenses.
Manage GST data easily.
Reduce accounting errors.
Save time and effort.

The platform is simple to use and built for real business needs.

Wrapping Up

Knowing who is liable for GST registration is essential before starting or expanding any business in India. GST laws clearly define who must register, who must pay tax, and who is exempt.

If your turnover crosses the limit or you fall under compulsory categories, registration is mandatory. If you are exempt, you can operate without GST legally.

Understanding these rules early helps you stay compliant, avoid penalties, and focus on growing your business the right way.

To know more, explore the GimBooks expert blog section!

Also check
GST Registration Requirements You Must Know Before Applying
2026 E-Way Bill Updates for: Transporters, Traders, and Manufacturers.

Frequently Asked Questions (FAQs)

1. Who is liable for GST registration in India?

Any person or business whose annual turnover crosses the prescribed GST limit or who falls under compulsory registration categories, such as interstate suppliers, e-commerce sellers, agents, or persons liable under reverse charge. These persons must register for GST as per the law.

2. Who is not liable for GST registration?

Small businesses with turnover below the threshold limit, agriculturists supplying produce from cultivation, and persons dealing only in exempt or non-taxable goods and services.

3. Who is liable to pay GST in India under reverse charge?

The reverse charge mechanism is the buyer of goods or services, instead of the seller. It applies to notified services and transactions with specific unregistered suppliers.

4. Are e-commerce sellers liable for GST registration even with low turnover?

Yes, e-commerce sellers fall under persons liable to register under GST and must obtain GST registration regardless of their annual turnover when selling through online platforms.

5. Who is liable for registration under GST when supplying goods across states?

Anyone making an interstate supply of goods is considered who is liable for registration under GST, even if their turnover is below the standard exemption limit.