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We have learnt about the persons who have to mandatorily register under GST in one of our previous blog. These persons have to register, irrespective of their turnover. Hence, even if their turnover is less than the threshold limit of Rs. 10 Lakhs (for special category states) and Rs. 20 Lakhs (for rest of India), these persons have to register under GST. However, certain persons need not mandatorily register under GST, though they fall in the category of persons who have to mandatorily register. This means that these persons have to register only when their turnover crosses the threshold limit. In this blog, let us understand which persons have been exempted from mandatory registration.

persons exempted from mandatory registration flowchart

Who need not mandatorily register under GST

a. Job workers providing services to registered persons in another state

Under mandatory registration rules, any person making interstate taxable supplies has to register under GST, irrespective of turnover. However, job workers who provide job work services to registered persons in a different state need not mandatorily register under GST. They will need to register only when their turnover crosses the threshold limit.

Note: This exemption is not applicable for job workers providing services related to jewellery and goldsmiths’ and silversmiths’ wares.

b. Persons supplying handicraft goods to persons in another state

Handicraft goods are certain specified goods made by craftsmen predominantly by hand, though some machinery might have been used in the process. Any person, including casual taxable persons, who supply these handicraft goods to persons in another state are not required to mandatorily register. They need to register only when their turnover crosses the threshold limit.

However, these persons should obtain a PAN (Permanent Account Number) and the goods must be moved under the cover of e-way bill, irrespective of the value of the goods. Hence, though as a general rule, e-way bill is required to be generated for a consignment whose value exceeds Rs. 50,000, persons supplying handicraft goods to persons in a different state should ensure that they generate an e-way bill for the supply, irrespective of the value of the goods.

Thus, job workers and handicraft goods suppliers can now make interstate supplies without having to mandatorily register under GST. Persons supplying handicraft goods should note that though mandatory registration is not applicable for them, they need to obtain a PAN and generate e-way bill for all interstate supplies, regardless of the value of the goods.

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