Usually, yes. Section 24 of India’s Central Goods and Services Tax (CGST) Act includes a person making an inter-State taxable supply among the categories required to register. The CBIC’s FAQ describes this liability as applying regardless of turnover, with an important exception for a person who exclusively makes nil-rated supplies. Exemptions and later notifications can change the result, so “small seller” does not by itself answer the question.
If registration is required, you generally apply online for each state or union territory in which you are liable, normally within 30 days after the liability arises. The GST Portal process starts at Services > Registration > New Registration, then uses a Temporary Reference Number (TRN) to collect your business, address, goods or services, identity and authentication details.
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Start with the legal question, not your sales total
An interstate sale is not automatically outside GST merely because the seller is a sole proprietor, works from home or has only a few orders. The first question is whether the supply is a taxable inter-State supply and whether a current exemption applies to that exact fact pattern.
Taxable inter-State supplies
Section 24 of the CGST Act lists persons making inter-State taxable supplies among those required to register. The CBIC FAQ states that a supplier making inter-State supplies is liable to obtain registration irrespective of turnover. Read that general rule with the notifications in force on the date you apply and with the classification of your goods or services. A low turnover figure is not a safe assumption that registration is optional.
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Exclusively nil-rated or exempt supplies
The CBIC FAQ identifies an exception for a person who exclusively makes nil-rated supplies. “Exclusively” matters: adding a taxable product, service, shipping charge or other taxable supply can change the analysis. Exemptions are also notification-based and may have conditions. If your catalogue contains a mixture of taxable, exempt and nil-rated items, have the actual tax classification checked rather than treating the whole business as exempt.
Why the seller’s state and supply type matter
Registration outcomes can differ by state or union territory, by goods versus services, by the nature of the supply and by the current notification set. The applicable turnover threshold is not uniform for every seller and every location. Before relying on a threshold, identify your state or union territory, the supply classification and any special category that applies to you.
Use this decision checklist before opening the application
- Identify where you are established. Note the state or union territory of your principal place of business and any additional business locations relevant to your supplies.
- Classify what you sell. Separate taxable, exempt and nil-rated goods or services. Keep the classification for each major product or service, not just a broad description such as “online sales.”
- Determine whether the supply is inter-State. The place of supply and the locations of supplier and customer control the legal treatment; an order placed online is not itself a complete GST classification.
- Calculate aggregate turnover correctly. Use the all-India total for all persons sharing your PAN, rather than the receipts of one shop, one platform or one state.
- Check the sales channel. A direct invoice to a customer and a sale made through an electronic commerce operator can be governed by different provisions.
- Look for a notification-based exemption. Confirm that every condition is met and that the notification is current when you apply.
- Map each registration obligation. If you are liable in more than one state or union territory, plan a separate application for each place where the law requires registration.
If any answer is uncertain, record the facts and obtain advice from a qualified GST practitioner before invoicing customers. The exact outcome cannot be determined from turnover alone.
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How aggregate turnover is calculated
CBIC describes aggregate turnover as a PAN-level, all-India calculation for the relevant person. It includes taxable supplies, exempt supplies, exports and inter-State supplies made by that person. It excludes specified tax amounts and inward supplies on which tax is payable under reverse charge, along with other statutory exclusions.
Practical implications for a small seller
- Add sales made from all your Indian locations that share the same PAN; do not use only the turnover of the state from which an order was shipped.
- Include exempt supplies when calculating aggregate turnover even though those supplies may not themselves carry output tax.
- Include exports and inter-State supplies in the calculation.
- Do not add GST, cess or other amounts that the statute specifically excludes, and do not treat qualifying reverse-charge inward supplies as your outward turnover.
- Keep a reconciliation by month, state, channel and tax classification so that your figure can be explained if the portal or an officer asks for clarification.
Because thresholds and exceptions depend on the seller’s circumstances, this article deliberately does not quote one universal threshold amount. Verify the current state-specific threshold and notifications after establishing the facts above.
Direct sales and marketplace sales are different branches
“Online seller” is not a single GST category. A seller who invoices a customer from their own website may face a different registration analysis from a seller using an electronic commerce operator covered by GST provisions.
When an electronic commerce operator is involved
Ask four questions before you decide that a marketplace changes (or removes) your obligation:
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- Does the platform fall within the relevant electronic-commerce provisions?
- Does it collect tax at source under the applicable GST rules?
- Are your particular goods or services covered by a current notification-based exception?
- Where is your business established, and what type of supply are you making?
The CGST Act and CBIC material discuss suppliers using certain operators that collect tax at source, while state tax guidance also discusses notification-based exceptions. Those exceptions are fact-specific. Do not assume that every marketplace seller is automatically required to register or automatically exempt from registration. Confirm the platform’s legal role, the product category and the current notification before relying on an exception.
Information to request from a platform
Obtain the operator’s legal name, the nature of its role in the transaction, whether it collects tax at source, the reports it provides and the states in which it treats you as established. Save the platform agreement and settlement statements with your own invoices. These records help you explain why a transaction was treated as direct, marketplace-facilitated or subject to a notification.
When to apply and when registration takes effect
Section 25 states a 30-day application period after liability arises. The GST Portal guide explains how the filing date affects the effective date for a normal taxpayer.
| Situation | Portal treatment described in the guide |
|---|---|
| You apply within 30 days after becoming liable | Registration is effective from the date liability arose. |
| You apply after the 30-day period | Registration is effective from the date registration is granted. |
| You save a TRN-based application but do not submit it within 15 days | The TRN and saved application information are purged, so you must start again. |
| You are liable in more than one state or union territory | File in each state or union territory where you are liable, following the applicable rules. |
The 30-day and 15-day periods are procedural instructions and should be checked against the live portal and current law when you file. Do not wait until an order is ready to ship if you already know that a taxable inter-State supply has created liability.
Prepare the information and evidence first
Having the details ready reduces portal timeouts, mismatched records and clarification notices. Prepare the following set for the applicant and each relevant location.
Identity and contact details
- PAN information for the proprietor or entity.
- An email address and mobile number that the applicant can verify by OTP and monitor after filing.
- Details needed for Aadhaar authentication or another identity process required for the case.
- Information needed for the electronic signing method available to the applicant.
Business and people details
- Constitution of the business, such as proprietorship, partnership or company.
- Promoter, partner, director or proprietor details requested by the form.
- Authorized signatory details and the authorization supporting that person’s role.
- Legal name exactly as it appears against the PAN record.
Place-of-business evidence
- Principal place-of-business address.
- Any additional places of business that the form requires you to disclose.
- Evidence of possession or consent appropriate to the premises, such as the document type accepted for an owned, rented or consent-based location.
The exact evidence depends on the premises and applicant type. Use the live portal’s document prompts rather than uploading an unrelated address document. Make sure the address, legal name and authorized signatory information are consistent across the application and attachments.
Goods and services information
- A clear description of the goods or services you supply.
- The relevant classification details requested by the portal.
- A record of which supplies are taxable, exempt or nil-rated.
- Details that support your decision about inter-State and marketplace transactions.
The GST Portal guide says bank-account information is optional at the application stage in the described workflow. If the current form presents a different requirement for your applicant type, follow the live form and instructions.
Step-by-step: submit a new GST registration
1. Open the New Registration form
- Go to the GST Portal.
- Choose Services > Registration > New Registration.
- Select the state or union territory in which the application is being made.
- Enter the legal name as per PAN, PAN, email address and mobile number.
- Complete the displayed verification and submit Part A.
Use contact details that the authorized applicant can access immediately. OTP messages and later portal communications go to these details.
2. Verify OTPs and receive the TRN
The portal sends OTPs for the email and mobile number. After successful verification, it generates a Temporary Reference Number. Record the TRN securely. It is the key to reopening the saved Part B application, but it is not the GSTIN and does not by itself prove registration.
3. Re-enter the TRN and open Part B
Use the TRN and the requested verification to continue the saved application. Work through every tab rather than stopping after the basic business profile.
4. Complete business and promoter information
Enter the constitution of the business, promoter or partner details, and authorized signatory information. Check spelling and PAN-linked names carefully. Select the person who is actually authorized to make the declaration and complete the supporting authorization details requested by the portal.
5. Add the principal and additional places of business
Provide the principal address and any additional locations required for your business. Upload the possession or consent evidence appropriate to each premises. An address mismatch is a common reason for clarification, so compare the typed address with the uploaded document before moving on.
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Enter the goods or services and classification information requested by the form. Do not use a description so broad that it conflicts with your invoices or marketplace catalogue. Include the categories that explain the inter-State sales for which you are seeking registration.
7. Complete authentication
Follow the portal’s Aadhaar authentication or biometric process where it is required for your case. If the portal offers another permitted route, use the method shown for your applicant type and keep any acknowledgment or appointment information it generates.
8. Review, sign and submit electronically
Review every section, attachments and declaration. Submit using an available electronic signing method. A successful submission generates an Application Reference Number (ARN).
9. Track the ARN
Use the portal’s application-status function to track the ARN. Keep a copy of the submitted form, uploaded evidence, acknowledgment and any messages requesting clarification. If the portal asks for a response, use the exact workflow and deadline displayed there.
Common mistakes and how to recover
Assuming low turnover means no registration
Why it fails: The general rule for inter-State taxable supplies is tied to the nature of the supply, not merely to a small sales figure.
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Fix: Recheck Section 24, the CBIC FAQ, the seller’s supply classification and current exemption notifications before deciding that registration is unnecessary.
Using one shop’s turnover as the aggregate turnover
Why it fails: Aggregate turnover is calculated across India for persons sharing a PAN and includes taxable, exempt, export and inter-State supplies.
Fix: Reconcile all locations and channels under the PAN, then remove only the statutory exclusions.
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Why it fails: A direct sale, a sale through an operator that collects tax at source and a sale covered by a notification can have different rules.
Fix: Identify the operator’s legal role, product category, establishment state and any current exception before filing.
Letting the TRN expire
Why it fails: The portal guide says an unsubmitted application and saved data are purged after 15 days.
Fix: Submit within that window or restart the application after the purge. Keep your prepared documents in a secure folder so a restart does not require recreating the business information.
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Why it fails: A typed address, consent document and identity details that describe different premises can trigger clarification.
Fix: Standardize the address format, use evidence appropriate to the type of possession and check each file before submission.
Waiting beyond 30 days
Why it fails: A late filing can change the effective date from the date liability arose to the date registration is granted.
Fix: Start the application as soon as liability is identified and retain the ARN and submission records.
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Worked examples for small sellers
Example: direct taxable goods sold from one state to another
A sole proprietor in one state sells taxable goods directly to customers in several other states. Even if the business is small, the Section 24 and CBIC FAQ rule generally points toward compulsory registration for those inter-State taxable supplies. The proprietor should calculate PAN-level aggregate turnover, check for a specific current exemption and, if liable, apply for the state registration within 30 days of liability arising.
Example: a catalogue made up exclusively of nil-rated products
A seller supplies only products that are correctly classified as nil-rated and has no taxable add-ons or other taxable supplies. The CBIC FAQ’s exception may be relevant, but the seller should verify that “exclusively” remains true and that no notification condition changes the result. Adding a taxable product or service requires a fresh assessment.
Example: marketplace sales with tax collected at source
A seller uses an electronic commerce operator that collects tax at source. The seller should not rely on the platform label alone. Confirm whether the operator and supply fall within the relevant provisions, whether a current notification exception covers the product and seller, and how the seller’s state affects the outcome.
Example: more than one business location
A business operates from locations in two states and makes inter-State taxable supplies. The owner should map where the business is liable and prepare a separate application for each state or union territory where registration is required. The PAN-level turnover calculation still covers the person’s supplies across India.
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- The supply is classified as taxable, exempt or nil-rated with supporting records.
- The seller’s state or union territory and every relevant business location are identified.
- Aggregate turnover includes all India-wide supplies under the PAN and removes only statutory exclusions.
- The direct-sale or marketplace route has been analyzed separately.
- Current exemption notifications and the applicable state-specific threshold have been checked.
- PAN, legal name, email and mobile number are ready for verification.
- Promoter, partner, proprietor and authorized-signatory details are complete.
- Principal and additional place-of-business evidence matches the typed addresses.
- Goods or services and classification information match the catalogue and invoices.
- The required Aadhaar, biometric or electronic-signing process is available to the applicant.
- The TRN, saved application and final ARN are recorded securely.
- The filing is planned within 30 days after liability arises.
GST registration for a small seller crossing state borders is therefore a fact-driven compliance decision, not a simple turnover test. The safest sequence is to classify the supply, calculate PAN-level aggregate turnover, identify the sales channel and current exemptions, then use the GST Portal’s New Registration workflow promptly. Where the facts involve mixed supplies, multiple states or a marketplace exception, a qualified GST professional can verify the position before you begin charging or accepting inter-State orders.
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