GST Exemptions List: Latest Details

GST Exemptions List: Latest Details

GST

Vakilsearch Staff

Vakilsearch Staff

82 week ago — 5 min read

GST registrations began on July 1, 2017. Some people are exempt from GST Registration because of the nature of their business. This means that your  business’s nature will determine whether you are exempt from paying the goods and services tax. You do not have to pay GST if your business does not involve the sale of goods or the provision of services. At the same time, farmers are exempt from paying GST. Let us read more about GST Exemptions List.

 

The taxpayers who are exempted from GST Registration are:

  • Agriculturists
  • People falling in threshold exemption limit
  • People making nil-rated/ exempt supplies of goods and services
  • People making non-taxable/ non-GST supplies of goods and services
  • Activities that are neither the supply of goods nor services
  • People making supplies that are covered under the  reverse charge.

 

Agriculturists

An agriculturist is someone who sells products derived from his farm’s cultivation. People from this industry will be exempt from GST registration. Agro-inputs such as seeds, fertilisers, irrigation (which requires electricity), machinery, and all other agricultural services are also exempt from GST.

 

Those With Turnover Less Than The Threshold Exemptions Limit

Any business entity supplying goods which has an annual turnover less of than ₹40 lakh and services less than ₹20 lakh are given exemptions from GST registration. But states like Assam, Manipur, Meghalaya, Mizoram, Nagaland, Tripura, Arunachal Pradesh, Jammu and Kashmir, Himachal Pradesh and Uttarakhand (special category states) where the threshold limit is ₹20 lakh for goods and ₹10 lakh for services. 

 

People making Nil-Rated/ Exempt supplies

People who are engaged in the business of supplying necessity items which are in the exemptions list of GST. 

Some of these are mentioned below:

  • All unprocessed food products like wheat, rice, bread, cereals, milk, vegetables, eggs, fish, meat,  salt etc.
  • Travel by train local and sleeper classes
  • Education
  • Healthcare (not including medicines)
  • Lodges and hotels with room rent less than ₹ 1,000 per day
  • Children’s colouring /drawing books
  • Sindoor, bindis bangles, etc

 

People Making Non-Taxable/ Non-GST Supplies

The following items also do not come under the purview of GST:

  • Petroleum crude and petrol
  • Natural gas
  • Electricity
  • High speed diesel
  • Alcohol for human consumption
  • Aviation turbine fuel

 

Activities That are Neither Supply of Goods nor Services

These include:

  • Services by an employee
  • Services by a Court or Tribunal
  • Functions and duties of –
  1. MLAs, MPs, Members of Municipalities, Panchayats, Municipalities and other local authorities;
  2. People holding any Constitutional Post;
  3. People as a Member, Chairperson or a Director in a body.
    • Funeral Services
    • Sale of building and land
    • Actionable claims (other than betting, lottery and gambling)

 

People Covered Under Reverse Charge

On 19th June 2016 via Notification No. 5/2017, the Central Government has exempted people from obtaining registration who are engaged only in making supplies of taxable goods or services, total tax on which is liable to be paid on the reverse charge basis by the recipient of such goods or services. This notification came into force on 22nd June 2016.

 

The Takeaway 

Many businesses manufacture goods or provide services that are not taxable under GST. Moreover many companies and professionals provide services that do not find a place in any of the GST slabs. So, it is vital that you get to know about all the relevant exemptions under the Goods and Services Tax Act. Get in touch with our experts to know weather the good and services provided by your organisation is eligible to avail GST exemption benefits. 

 

Also read: How to register for GST online?

 

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Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views, official policy or position of GlobalLinker.

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Vakilsearch Staff

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