A non-resident taxable person under GST is any person or business or not-for-profit who occasionally undertakes transactions involving the supply of goods or services or both, whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India. Hence, any foreign person or foreign business or organisation supplying goods or services to India would be a non-resident taxable person – requiring compliance with all GST regulations in India.
All non-resident taxable persons are required to obtain GST registration in India, irrespective of aggregate annual turnover or any other criteria. Further, the GST Act and Rules specify that all non-resident taxable persons must obtain GST registration five days prior to the commencement of business. Hence, it is important for foreign businesses supplying goods and services to India to obtain GST Registration at the earliest.
Prior to beginning the process for applying for GST registration, foreign businesses or foreign applicants must identify a person in India to act as its authorised representative for GST compliance and obtain PAN in India for the foreign entity (optional). As per GST rules, the application for GST registration made by a non-resident taxable person should be signed by his authorised signatory who shall be a person resident in India having a valid PAN.
Hence, once the authorised signatory is engaged, Indian GST registration process can be started for non-resident taxable persons. To apply for GST registration as a non-resident taxable person, the application must be submitted in FORM GST REG-09. GST registration is PAN based for regular taxpayers. However, in the case of non-resident taxable persons, the GST registration application can be submitted with a tax identification number or unique number on the basis of which the entity is identified by the Government of that country or its PAN, if available.
In case of a non-resident taxable person supplying online information and database access or retrieval (OIDAR) services to a non-taxable online recipient, then application in FORM GST REG-10 must be submitted electronically.
Note: Advice House can help foreign businesses obtain GST registration in India.
The following documents must be provided by the non-resident taxable person during the GST registration process:
Scanned copy of the first page of Bank passbook / one page of Bank Statement Opening page of the Bank Passbook held in the name of the business – containing the Account Number, Name of the Account Holder, MICR and IFSC and Branch details.
Non-resident taxable persons are required to appoint an authorised representative in India. An authorisation or copy of Resolution of the Managing Committee or Board of Directors authorising the authorised representative must be provided in the specified format.
Non-resident taxable persons and casual taxable persons under GST are required to remit a deposit for GST registration. The amount of deposit for GST registration would equal the expected tax liability during the validity of the registration. Further, in case a non-resident taxable person requests for extension of GST registration, then tax must be deposited in advance based on the expected tax liability of the extension period.
Once, the GST registration application is filed by a non-resident taxable person; an application reference number would be generated for payment of advance tax. On payment of tax, the electronic cash ledger of the taxpayer is credited, and GST registration certificate is provided.
GST registration for casual taxable persons and non-resident taxable persons are provided with a validity period. The validity period would be based on the request of the taxable person, and the amount of GST deposit remitted. If a non-resident taxable person intends to extend the validity period of GST registration, an application can be made in FORM GST REG-11 before the end of the validity of the registration.
In case of NRI, in order to obtain GST registration, following a two-step procedure needs to be followed:
An application in Form GST REG-09 is required to be submitted, electronically, by the Non-resident taxable person (NRI). Self-attached copy of valid passport is to be submitted along with the application.
Further, in the case of foreign entity, application for GST registration is to be submitted along with tax identification number or unique number or PAN (if applicable).
A non-resident taxable person is required to deposit the advance tax. Such advance payment of tax would be based on self-estimation. Advance tax deposit is mandatory to be submitted along with the application.
Final registration of Non-resident taxable person would be carried out in the same line as of the resident taxpayer in India. The procedure for the same is narrated below:
The applicant is required to submit, electronically, an application in FORM GST REG-26. The applicant is required to submit all the information related to tax and GST within three months from the provisional registration.
If the information provided is accurate and complete, then, final GST registration will be issued to the applicant in FORM GST REG-06. However, if the information provided is incorrect or incomplete, the officer would issue a show-cause notice to the applicant in FORM GST REG-27.
If the applicant is not able to give an appropriate reply to the show cause notice issued and after giving the appropriate opportunity of being heard to the applicant and on the satisfaction of the officer, the provisional registration granted to the applicant would be cancelled through FORM GST REG-28.
However, if the applicant is able to give an appropriate reply to the show cause notice issued and the said reply is acceptable to the officer, the show cause notice would be nullified by issuing an order in FORM GST REG-20.
The application for registration of the non-resident should be duly signed by the authorised signatory of the applicant. The said authorised signatory should be a person resident in India, and he would have a valid PAN.