GST registration for a Pvt Ltd company: threshold, timeline, and mandatory triggers even below ₹40L

The registration threshold for a Pvt Ltd is ₹40 lakh for goods-only supply and ₹20 lakh for services in most states — but four triggers force registration below that line. Inter-state supply, selling through an e-commerce operator, reverse-charge liability, and SEZ operations each make a GSTIN compulsory at ₹0 turnover. The 30-day filing clock under s.25(1) starts the day liability arises, not the day turnover crosses.

What the law actually requires

Registration is governed by s.22 CGST Act 2017 (threshold) and s.24 CGST Act 2017 (compulsory registration), read with CGST Rule 8. For a company, the PAN of the entity is the base — every GSTIN is carved out of the same PAN, one per state where the company supplies.

The threshold (s.22). A person becomes liable when aggregate turnover in a financial year exceeds the exempt limit:

The ₹40 lakh goods threshold comes from Notification 10/2019-CT dated 7 March 2019; the ₹20 lakh services line from s.22(2) read with Notification 10/2017-CT. "Aggregate turnover" under s.2(6) counts all taxable and exempt supplies, exports and inter-state supplies across all registrations under the PAN, but excludes inward supplies on reverse charge. The test is applied state-wise, so a company operating in three states tracks three separate aggregate-turnover positions.

The mandatory triggers (s.24). Section 24 overrides the threshold entirely. If any trigger applies, registration is compulsory from the date of the first such transaction, at whatever turnover:

An SEZ unit or SEZ developer also requires registration, not because s.24 names it but because supplies to an SEZ are zero-rated under s.16 IGST Act 2017 and zero-rating is available only to a registered recipient. No GSTIN, no zero-rated procurement.

What changed FY 2025-26

Registration enforcement tightened in three ways during FY 2025-26:

• Biometric Aadhaar authentication expanded. GSTN rolled out biometric-based verification for registration applicants in more states and in higher-risk categories (supply of goods liable to higher rates, high-turnover claims). Where it applies, the authorised signatory must attend a GST Suvidha Kendra in person; the registration is otherwise not granted.
• Special drive against fake registrations. The nationwide drive to cancel shell registrations that issue bogus invoices without supplying goods continued — GSTN now cross-validates the bank account (Form GST REG-06 requires the account holder's name to match the GSTIN) before registration is approved.
• No change to the threshold. The ₹40 lakh / ₹20 lakh lines and the s.24 triggers are unchanged in FY 2025-26 — which is itself the point: a newly incorporated services company cannot wait for turnover to build before registering.

Worked example: TechCore Pvt Ltd

TechCore Pvt Ltd is incorporated in Bengaluru on 15 December 2024. It sells IT services to MNC clients across India. This is the classic mandatory-registration fact pattern — the services threshold (₹20 lakh) is irrelevant because the inter-state trigger under s.24(i) bites first.

The registration is back-dated to the date of liability. TechCore must report the 5 Feb invoice in its first return even though the GSTIN was issued in March. Filing REG-01 late attracts a late fee under s.40 read with Rule 9 — and an unregistered inter-state supplier who should have registered cannot collect GST on invoices issued before registration, so the tax on the 5 Feb invoice is borne by TechCore itself unless it recovers it.

Step-by-step: how to register a Pvt Ltd

• Get the PAN first. The company PAN is the single mandatory document. No PAN, no GSTIN.
• Confirm liability date. For a mandatory trigger, it is the date of the first triggering transaction; for threshold crossing, it is the day aggregate turnover crosses ₹20 lakh / ₹40 lakh.
• File Form GST REG-01 on the GST portal (or through a GST Suvidha Kendra) within 30 days. Upload: PAN, incorporation certificate, address proof, bank account details (IFSC, account number), and the authorisation for the signatory.
• Complete Aadhaar authentication of the authorised signatory; attend biometric verification if the state/risk profile requires it.
• Track the ARN — the application reference number. The officer must approve or issue a notice in Form GST REG-03 within 7 working days; if no deficiency, Form GST REG-06 issues the GSTIN.
• Back-fill the returns. If registration is effective from a past date (as in the TechCore example), the intervening transactions go into the first GSTR-3B and GSTR-1.

FAQ

A services company in Bengaluru has ₹8 lakh turnover and no inter-state sales. Must it register?
No, not yet. Services turnover below ₹20 lakh (₹10 lakh in special-category states) is below the s.22 threshold, and none of the s.24 triggers apply. The moment it invoices a client outside Karnataka, s.24(i) makes registration compulsory at any value.

Is the ₹40 lakh threshold available to a company that sells software with support services?
No. Notification 10/2019-CT allows ₹40 lakh only to persons exclusively engaged in the supply of goods. A composite supply where the principal supply is a service, or a mixed goods-plus-services business, falls to the ₹20 lakh services threshold under s.22.

What happens if we start supplying inter-state and register after 6 months instead of 30 days?
The GSTIN is still granted, but effective from the date of liability, so six months of invoices were issued without collecting GST. Section 76 read with s.73 exposes the company to tax, 18% interest under s.50, and late fees — plus the customers in those six months were denied ITC they could not legally claim.

Can one company have two GSTINs in the same state?
No — one GSTIN per state under a PAN, except a separate registration for a business vertical under s.25(2). A second registration for the same state and vertical is not permissible.

For a GST registration health-check of your company, visit pvtltd.co.

Sources

• s.22, s.24, s.25, s.40, s.47 CGST Act 2017
• s.2(6) CGST Act 2017 (aggregate turnover)
• CGST Rules 8–12 (Form GST REG-01, REG-06)
• Notification 10/2019-CT dated 7 March 2019 (₹40 lakh goods threshold)
• Notification 10/2017-CT dated 28 June 2017 (₹20 lakh services threshold; ₹10 lakh special-category states)
• s.16 IGST Act 2017 (zero-rated supply to SEZ)

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