GST Implication for payment of Invoice - unregistered consultants

Dear All,

We have 3-4 unregistered consultants who are working with us. Now, starting from July onward, is it necessary for them to register for GST, or is there any other way we can pay them?

Thanks,
Gunjan

Dear Gunjan,

If the financial earnings for the last FY are more than Rs 20 lakh, then it is mandatory to register for GST. Those who do not register for GST are called Unregistered Dealers (URDs). When you receive an invoice from the URDs, you need to pay the GST on their behalf and take the input credit. However, if the URDs are from another state, you need to check the procedure with your CA.

Thanks,
Dinesh Divekar

Hello,

I run an HR consulting firm. Yet, I do not need to go for service tax registration as I do not meet the criteria for earnings under GST. So, just for clients' requirements, can I apply for GST?

Dear Shreya, yes, if the client is saying that they will give you business only if you have GST, then you will have to comply. However, if you register for GST, your workload will increase. Monthly, you will have to submit three returns and one annual return, totaling 37 returns per annum. Please check with the client whether they are willing to accept your services as an Unregistered Dealer (URD). In reality, every company will have to engage with URD; they cannot avoid it. Forcing a service provider to register for GST reflects nothing but their assertiveness.

Thanks,
Dinesh Divekar