Selling Online Without GST Certificate: Understanding the Quotas and Options

If you are running a small business and your annual sales are less than Rs. 20 lakhs (Rs. 2,000,000), you may be considering selling your products online without having a GST certificate. This is a common question among many sellers and business owners. However, the reality is that without GST registration, selling online can be a challenge. This article will explore the limitations and alternatives available for online sales without GST.

Underlying Regulations and Requirements

The Goods and Services Tax (GST) in India introduced a new set of regulations for e-commerce operators starting April 1, 2020. Prior to this, every e-commerce operator was required to register for GST. However, the current mandate is stricter, and GST registration is now mandatory only for e-commerce operators who have an obligation to collect tax at source. This implies that self-registration is not a valid alternative, and you cannot sell online without a GST certificate if your annual sales exceed the threshold.

Circular and Sales Quotas

A recent GST circular has come into effect, stating that e-commerce operators liable to collect and deposit tax at source must register. This means that if your business falls under this category, you are required to register for GST, or you cannot sell online legally. The circular further clarifies that e-commerce is only liable to collect tax if the value of taxable supply is more than Rs. 20 lakhs in a financial year and the goods are supplied to a consignee that is not a registered person.

Alternative Options

While the requirement for GST registration seems to be a significant hurdle, there are still options available for sellers with sales below Rs. 20 lakhs. One such option is to sell through platforms or apps that do not require GST registration. These platforms often have built-in systems to handle third-party timestamps and mandatory small-scale business logbooks.

Example: Messo App

An example of such a platform is the Messo App. This app allows you to sell Messo products by sharing them through WhatsApp. Here’s how it works:

Register on the app. Post the products you want to sell on your WhatsApp or social media. Share the product links with your network. Customers can then purchase the products directly from the post.

The advantage of such an app is that it helps you comply with the GST requirements by offering a platform that can handle small-scale businesses. However, it’s crucial to understand the terms and conditions of such platforms to ensure compliance and avoid any legal issues.

Conclusion

In conclusion, if your sales are below Rs. 20 lakhs per annum and you are not obligated to collect tax at source, you can still sell online without GST registration. However, you must ensure that your business practices comply with the latest GST circulars. Being aware of the regulatory landscape and exploring alternative sales platforms can help you navigate the challenges and continue to grow your business.