Certain businesses operate in a manner that they occasionally undertake transactions in territories where they don’t have a fixed place of business. Under GST, a person who has a fixed place of business in a state and undertakes taxable outward transactions has to register, if his turnover crosses the prescribed threshold limit. What happens if a person undertakes taxable transactions in a place where he/she does not have a fixed place of business?

This can happen in two cases:

  1. The person has a fixed place of business in a state and occasionally undertakes taxable transactions in another state where he has no fixed place of business.
  2. The person resides outside India but occasionally undertakes taxable transactions in India where he has no fixed place of business or residence.

Persons referred to in the first case are called ‘casual taxable persons’, i.e. persons who occasionally undertake taxable transactions in a state where they don’t have a fixed place of business. Examples of casual taxable persons are sellers in exhibitions, trade fairs, circus business, etc.

Persons referred to in the second case are called ‘non-resident taxable persons’, i.e. persons who reside outside India and occasionally undertake taxable transactions in India, where they don’t have a fixed place of business or residence.

Let us now understand the provisions with respect to casual and non-resident taxable persons in the current regime and under GST.

Previous Regime

The concepts of ‘casual dealers’ and ‘non-resident dealers’ exists in the current regime, under VAT. The rules of registration, payment of tax and return filing vary from state to state. For example, in Kerala, casual and non-resident dealers should mandatorily register, irrespective of their turnover. The application for registration should be submitted at least 3 days prior to commencement of the business. The certificate of registration issued is valid for maximum 3 months from the date of issue. Such dealers should submit the monthly return (Form 10E) by 10th of the month or within 24 hours after completion of the last business transaction, whichever is earlier. Payment of tax should be done along with submission of the monthly return. In other states like Uttar Pradesh, the tax liability for the registration period should be estimated and paid in advance at the time of applying for registration.

GST Regime

Registration

Mandatory registration- All persons who are going to undertake transactions as casual taxable persons or non-resident taxable persons must mandatorily register, irrespective of their turnover.

Registration Forms

Type of registrationApplication for registration
Casual taxable personGST REG-01
Non-resident taxable personGST REG-09

Process of registration

  1. Application for registration must be submitted at least 5 days prior to commencement of the business. While submitting the application, the person has to estimate his tax liability for the period and deposit the equivalent amount as advance tax.

Example: Mr. Prakash runs a retail shop for handmade jewellery and is registered in Maharashtra. Mr. Prakash is planning to sell the jewellery at an exhibition in Gujarat, to be held from 1st August, 2017 to 15th August, 2017.

Here, Mr. Prakash should apply for registration as a casual taxable person within 5 days of commencing the exhibition on 1st August, 2017. Mr. Prakash should also make an advance deposit of the estimated tax liability for the period of 1st August to 15th August, 2017.

Note: If the person is applying for registration as a non-resident taxable person, the application should be signed by an authorised signatory, who should be a person residing in India with a valid PAN.

  1. Once a certificate of registration is issued to the person, it will be valid for maximum 90 days from the date of registration. On request, the registration can be extended for another 90 days by submitting an application in Form GST REG-11. The application for extension of registration should be submitted before the registration gets expired. If the registration period is extended, the person must deposit an additional amount of tax equivalent to the estimated tax liability for the period for which registration is sought.
  1. If the advance tax deposited turns out to be more than the actual tax liability, the same will be refunded to the person after he/she files the returns for the period.
Returns

A casual taxable person has to furnish the monthly returns applicable to a regular dealer for the period of registration. These are given below:

Returns to be furnished by Casual Taxable Persons
FormFrequencyDue DateDetails
GSTR-1Monthly10th of succeeding monthFurnish details of outward supplies of taxable goods and/or services
GSTR-2AMonthly11th of succeeding MonthAuto-populated details of inward supplies made available to the recipients of supply on the basis of Form GSTR-1 furnished by suppliers
GSTR-2Monthly15th of succeeding monthFurnish details of inward supplies for claiming input tax credit. Additions or modifications in Form GSTR-2A should be submitted.
GSTR-1AMonthly17th of succeeding monthDetails of outward supplies added, corrected or deleted by the recipients in Form GSTR-2 will be made available to supplier. Supplier can accept or reject the modifications made by recipients
GSTR-3Monthly20th of succeeding monthMonthly return to be filed containing final details of outward supplies and inward supplies along with payment of tax

 

Return to be furnished by Non-Resident Taxable Persons
FormFrequencyDue DateDetails
GSTR-5Monthly20th of the succeeding month or within 7 days after the expiry of registration, whichever is earlierFurnish details of imports, outward supplies, ITC availed, tax paid and closing stock
Conclusion

For casual and non-resident taxable persons, GST will bring ease in compliance as rules pertaining to registration, payment of tax and return filing will be common across India, unlike in the current regime, where these rules vary from state to state. Important rules to remember for casual and non-resident taxable persons under GST are that application for registration should be filed at least 5 days prior to commencement of business, along with payment of advance tax based on the estimated tax liability, certificate of registration will be valid for maximum 90 days, which can be extended by maximum another 90 days, and monthly returns should be filed for the registration period.

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