Most service suppliers use a ₹20 lakh threshold and eligible exclusive goods suppliers may use ₹40 lakh in notified states, with lower thresholds elsewhere. These figures are not universal and do not override compulsory categories or notification-based exceptions.
Current law before inherited content
The supplied draft was used as a topic brief, not as legal authority. Competitor promotions, duplicated wording, obsolete examples and unsupported claims have been removed. Always verify the effective notification and the facts of the transaction before acting.
Review status: Professional review pending. This general guide is not a legal opinion, tax computation, audit conclusion or filing instruction for a specific person.
Threshold map
The general section 22 threshold and the enhanced goods threshold operate through statutory provisions and notifications. State selection, exclusive supply of goods and excluded categories matter. Service thresholds are generally ₹20 lakh, with ₹10 lakh in specified states.
Calculate aggregate turnover
Add taxable outward supplies, exempt supplies, exports and interstate supplies across India for the same PAN. Exclude CGST, SGST, UTGST, IGST and cess, and inward supplies taxed under reverse charge. Do not subtract exempt supplies.
Compulsory categories and exceptions
Section 24 lists categories including certain interstate suppliers, casual and non-resident taxable persons, TDS/TCS persons, agents and e-commerce participants. Later notifications relax some categories, so a blanket ‘every interstate seller’ or ‘every marketplace seller’ statement is unsafe.
Composition is a different test
Composition eligibility limits do not determine whether registration is required. First establish registration liability; then separately test turnover, activity, interstate supply, e-commerce and other composition restrictions.
Small-business decision
Below-threshold businesses can remain unregistered where no compulsory provision applies, or register voluntarily. Compare ITC value, customer profile, marketplace plans and continuing compliance cost before choosing.
Monitoring and evidence
Maintain a monthly PAN-level turnover schedule, state-wise supply map and evidence for excluded items. Set an internal alert below the applicable threshold and document the legal basis for any exception.
Need a fact-specific compliance review?
Map the applicable law, effective date, documents, filing route and ongoing obligations before relying on a general article.
Request a TargoLegal reviewFrequently asked questions
Are exempt supplies included?
Yes, generally.
Is GST collected part of turnover?
No.
Does ₹40 lakh apply to services?
No; it is an enhanced threshold for eligible suppliers of goods under notified conditions.
Must every interstate service provider register?
Notification-based exemptions may apply below threshold; check the current rule.
Does composition replace registration?
No. It is an optional payment scheme for eligible registered persons.
