Casual Taxable Person Under GST

Who is a Casual Taxable Person?

In the realm of Goods and Services Tax (GST), a casual taxable person (CTP) refers to someone who occasionally supplies taxable goods or services, but crucially, lacks a fixed place of business in the specific taxable territory. This can include individuals acting as principals, agents, or in any other capacity to further business goals.

Here’s a breakdown of the key aspects of a casual taxable person:

• Occasional Supply: CTPs engage in taxable transactions on an infrequent basis, not as a regular course of business. They might be one-time deals, short-term projects, or seasonal sales.
• No Fixed Place of Business: They don’t have a permanent establishment or infrastructure within the territory where they’re supplying goods or services. This could be a physical office space, a warehouse, or even a designated desk in a co-working space.

For Example, imagine a consultant based in Delhi providing management consultancy services for a short-term project in Mumbai. Since they don’t have a permanent office in Mumbai, they would be considered a casual taxable person in that territory.

Registering for GST as a Casual Taxable Person

Unlike regular taxpayers who have a threshold for registration based on their annual turnover, there’s no such limit for casual taxable persons. However, GST regulations require them to compulsorily register if they’re making taxable supplies in India.

Here’s a crucial point to remember: Casual taxable persons cannot opt for the composition levy scheme, a simplified tax payment method available to certain small businesses. This means they’ll have to follow the regular GST filing procedures.

Requirements of GST Registration

There are no specific prerequisites for CTP registration beyond the occasional nature of the taxable supply and the absence of a fixed place of business in the territory. However, you’ll need to have the following information ready for the registration process:

• PAN (Permanent Account Number): This is a unique ten-digit alphanumeric code assigned by the Income Tax Department for tax purposes.
• Aadhaar Card (or any other prescribed verification document): Aadhaar is a unique twelve-digit biometric ID number issued by the Unique Identification Authority of India (UIDAI). If you don’t have an Aadhaar card, you can use alternative verification documents as specified by the GST authorities.
• Details of the nature and estimated value of the supply: This includes a clear description of the goods or services you’ll be providing, along with an estimated value of your total transactions.
• Bank account details: You’ll need to provide the bank account information where any tax refunds can be credited.

Validity Period of Registration

The registration obtained by a casual taxable person is valid for a specific period mentioned in the application, or for a maximum of ninety days from the effective date of registration, whichever is earlier. This is because CTPs are supposed to be occasional suppliers.

There’s a provision for extension, though. You can extend your CTP registration for an additional ninety days, provided you apply before the expiry of the initial period. It’s important to note that extensions are only allowed once. If your business activity extends beyond the validity period, you’ll need to register as a regular taxpayer.

Step-by-Step Guide to Casual Taxable Person Registration

The registration process for casual taxable persons can be done online through the GST portal. Here’s a simplified outline of the steps involved:

1. Access the GST portal and register yourself. You can do this by creating a new account using your PAN details and Aadhaar card.
2. Navigate to the “Registration” section and select the option for “Casual taxable person.”
3. Fill in the required details as mentioned earlier, including the nature and estimated value of your supply.
4. Pay the estimated tax liability based on your projected turnover. This tax amount needs to be deposited electronically using challan before submitting the application.
5. Submit the application electronically. Once submitted, the authorities will process your application and grant you registration if everything is in order.

GST Return Filing

Casual taxable persons are obligated to file GST return forms. These returns help the government track tax collected and ensure compliance. The specific forms you need to file and the filing frequency depend on the value of your taxable supply. Here’s a breakdown:

• GSTR-1 (for outward supplies): This return details all the outward supplies made during the period of operation. It must be filed by the 11th of the following month.
• GSTR-3B (for inward supplies): This is a summary return that provides details of the tax liability and input tax credit claimed. It must be filed by the 20th of the following month.

Note – The filing frequency for these returns can be monthly or quarterly depending on your turnover thresholds.

Claiming GST Refund as a Casual Taxable Person

Casual taxable person is eligible for the refund of any amount deposited in excess of tax liability which will be refunded after all the necessary returns (GSTR-1 & 3B) have been furnished for the Registration period. Application for Refund of balance in excess of tax liability in the electronic cash ledger can be claimed in Form GST RFD-01 under the category “Refund of excess balance in the electronic cash ledger”.

Conclusion

Understanding the nuances of a Casual Taxable Person’s obligations under the GST regime is crucial for compliance and efficient business operations. Proper registration, timely filing of returns, and adherence to tax laws ensure smooth and lawful conduct of temporary business activities in any taxable territory.