GST Registration Threshold Limit: Do You Need to Register?

You need GST registration once your aggregate turnover in a financial year crosses ₹40 lakh if you supply only goods, or ₹20 lakh if you supply services. A few states have lower limits. Some businesses must register from day one, whatever their turnover: inter-state sellers of goods, most e-commerce sellers, and anyone liable under reverse charge, among others.

This guide covers the limits, how to work out your turnover, and the cases where the threshold doesn’t apply at all.

What is the turnover limit for GST registration?

The limit depends on what you sell and where your business is registered.

Who you are	Registration needed when aggregate turnover exceeds
Supplier of goods only, in most states	₹40 lakh
Supplier of goods only, in Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Puducherry, Sikkim, Telangana, Tripura or Uttarakhand	₹20 lakh
Supplier of services, or of both goods and services, in most states	₹20 lakh
Supplier of services in Manipur, Mizoram, Nagaland or Tripura	₹10 lakh

A few points that trip people up:

• ₹40 lakh applies only if you supply goods exclusively. If you also earn even a small amount from services (installation charges, repairs, commission), the ₹20 lakh limit applies.
• Some goods are excluded from the ₹40 lakh limit. Manufacturers of items such as ice cream, pan masala and tobacco products stay at the lower limit.
• The ₹20 lakh goods states are the ones that chose not to adopt the higher ₹40 lakh limit when it was introduced in April 2019. States can change this choice, so confirm your state’s current limit if you’re close to it.

Tip: These limits have not changed since April 2019. The GST Council’s 2025 reforms simplified how you register (see below), but they did not raise the turnover limits.

How do you calculate aggregate turnover?

Aggregate turnover is wider than most people expect. It is the total value of all your supplies, calculated on your PAN for the whole of India, for the financial year (April–March).

It includes:

• Taxable sales of goods and services
• Exempt supplies, such as fresh vegetables or other exempt items
• Exports of goods and services
• Inter-state supplies between your own branches that share the same PAN

It excludes:

• The GST itself (CGST, SGST, IGST and cess)
• Purchases on which you pay tax under reverse charge

Example: A Jaipur boutique sells clothes worth ₹32 lakh and earns ₹3 lakh from tailoring services in 2026-27. Because it supplies both goods and services, the ₹20 lakh limit applies. Its aggregate turnover is ₹35 lakh, so it must register, even though it is below ₹40 lakh.

You must apply within 30 days of the date your turnover crosses the limit, not at the end of the year. Track your monthly running total.

Who must register regardless of turnover?

Section 24 of the CGST Act lists cases where the threshold does not apply. The ones small businesses meet most often:

1. Inter-state sellers of goods. If you sell goods to a buyer in another state, you generally need registration from the first sale.
2. Casual taxable persons. For example, someone who sets up a stall at a trade fair in another state.
3. People who must pay tax under reverse charge. Here the buyer, not the supplier, pays the GST. See our reverse charge (RCM) guide.
4. Sellers on e-commerce platforms where the platform must collect tax (TCS), with the exceptions covered below.
5. Non-resident taxable persons, agents supplying on behalf of others, Input Service Distributors and TDS deductors.
6. E-commerce operators themselves, and overseas providers of online services (OIDAR) to unregistered Indian customers.

Exceptions that help small businesses

• Inter-state services: a service provider who works for clients in other states does not need registration until crossing the ₹20 lakh (or ₹10 lakh) limit.
• Services through e-commerce platforms (for example, a freelancer on a domestic marketplace) are exempt from compulsory registration below the threshold.
• Goods through e-commerce platforms: from 1 October 2023, small sellers can supply goods within their own state through an e-commerce operator without registration, if turnover is within the threshold and they take an enrolment number on the GST portal. This doesn’t apply to inter-state sales. Our GST guide for e-commerce sellers explains the conditions.

Who does not need GST registration?

• Businesses below the threshold that don’t fall under any compulsory category
• Persons supplying only exempt goods or services, or goods and services not taxed under GST
• Agriculturists supplying produce from their own cultivation

Should you register voluntarily below the limit?

Voluntary registration can make sense if:

• your customers are GST-registered businesses that want to claim input tax credit (ITC), the GST paid on purchases that a business can deduct from its own GST bill;
• you want to sell on marketplaces or to corporate clients that insist on a GSTIN;
• you pay a lot of GST on purchases and want to claim it back.

The trade-off is compliance. Once registered, you must issue GST invoices and file returns every period, even when you have no sales. If your customers are mostly consumers, the composition scheme may be a cheaper alternative to normal registration.

How fast can you get registered now?

Normally an officer must approve or query a complete application within 7 working days. That stretches to 30 days if physical verification of your premises is needed, or if Aadhaar authentication fails or isn’t chosen.

From 1 November 2025, there is also an optional simplified route under Rule 14A. Applicants who expect their monthly output tax on supplies to registered buyers to stay within ₹2.5 lakh can get registration on an automated basis within 3 working days after Aadhaar authentication. If your B2B tax later goes above that, you must first formally withdraw from the scheme.

If your application gets a query or rejection, our guide to why GST registration gets rejected covers the common fixes.

Common mistakes

• Using the ₹40 lakh limit while also providing services. Any service income brings you down to ₹20 lakh.
• Leaving out exempt sales or exports. Both count towards aggregate turnover.
• Counting turnover per branch or per state. It is counted on your PAN across India.
• Waiting until year-end. The 30-day clock starts when you cross the limit.
• Assuming a marketplace seller never needs registration. The exemption covers only intra-state goods sales with an enrolment number, or services within the threshold.
• Not registering for a single inter-state goods sale. That alone usually makes registration compulsory.

Watch out: If you were liable but didn’t register, the department can demand the tax you should have charged, with interest and a penalty, even if you never collected GST from customers.

What to do next

1. Add up your turnover for the current financial year using the definition above.
2. Check whether any compulsory registration category applies to you.
3. If you’re close to the limit, keep invoices and bank statements ready. You’ll need PAN, Aadhaar, address proof of your place of business, and bank details.
4. Check a supplier’s or customer’s GSTIN with our free GSTIN validator.

If you’d rather not handle the application yourself, our team can manage it end to end through our GST registration service.