Do You Require a GST Number to Register an MSME?

Posted on Wednesday, October 16th, 2024 | By IndusInd Bank

Micro, Small and Medium-Sized Enterprises (MSMEs) drive the economy by generating employment, fostering innovation, and contributing to the nation’s GDP. They have the potential to grow through digital transformation, access to quick funds, and supportive regulatory frameworks offered by the government. However, to avail these benefits, an MSME certificate registration is necessary.

You may wonder how to go around the MSME registration process and whether online GST registration is crucial for this process. This article deep dives into these questions and more. 

Is a GST Number Mandatory for MSME Registration?

A GST number is not mandatory for the MSME registration process for businesses or entities that do not need GST registration. However, enterprises or businesses with turnover over a particular threshold are taxable entities and need a GST registration number. The threshold limits for the online GST registration depend on the type of supply (goods or services or both) and the state in which the business operates. Here’s a detailed look at the threshold limits: 

For suppliers engaged exclusively in the supply of goods

·       In the states of Tripura, Mizoram, Manipur, and Nagaland, the threshold limit is ₹10 lakh.

·       In Uttarakhand, Sikkim, Arunachal Pradesh, Puducherry, Telangana, and Meghalaya, the threshold limit is ₹20 lakh.

·       For other states, the threshold limit is ₹40 lakh.

For suppliers engaged in the supply of services or both goods and services –

·       In the states of Manipur, Tripura, Mizoram, and Nagaland, the threshold limit is ₹10 lakh.

·       For other states, the threshold limit is ₹20 lakh.

Further, the Udyam Online Registration Portal for MSME registration, linked with income tax and GSTIN, will automatically gather PAN and GST details of businesses surpassing a specific annual turnover from government records. This prevents you from undergoing the process of GST number check.  

MSME Registration Process

In 2020, the Central Government introduced the Udyam Registration portal. As per the rules, new businesses can register using their Aadhaar number and self-declaration. The business’s details can be verified through GSTIN or PAN. Steps for Udyam Registration include –

·       Visit the Udyam Registration website.

·       Click on the Udyam Registration form – for new enterprises not registered as MSMEs link.

·       Provide the entrepreneur’s name and Aadhaar number.

·       Authenticate and generate OTP to proceed.

·       Select the enterprise type and fill out the necessary details.

·       Submit the form and receive a confirmation message on your registered email and mobile number.

·       The Udyam certificate will be mailed to you.

Is a Current Account Essential for MSME Registration?

A current account is essential for MSME registration as it helps streamline financial transactions, offering a clear record for auditing and tax purposes. One such current account you may consider is the Indus Select Current Account by IndusInd Bank.

This premium account is particularly tailored to offer a blend of scale and convenience to help businesses create more value. Here are some of the attractive benefits –

Also Read: Understanding Current Accounts: What You Need to Know

Ending Note

While a GST number is not mandatory for MSME Udyam registration for businesses below an annual turnover threshold, it becomes necessary for taxable entities. The GST and MSME registration processes are simple and can be done online with the necessary documents.

Moreover, having a current account, such as the Indus Select Current Account by IndusInd Bank, can greatly benefit enterprises by offering seamless banking services and other financial conveniences. So, hurry and open a current account online with IndusInd Bank today. Apply now!

Disclaimer: The information provided in this article is generic and for informational purposes only. It is not a substitute for specific advice in your circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for making any financial decisions based on the contents and information.