GST registration limit: ₹40 lakh, ₹20 lakh or ₹10 lakh?

✓Checked against official sources · verified 30 October 2026

The threshold limits

Section 22 of the CGST Act sets the basic limit at ₹20 lakh (₹10 lakh in special category states). Using the power in section 22, the government raised the limit to ₹40 lakh for persons engaged exclusively in supplying goods, by Notification No. 10/2019-Central Tax, from 1 April 2019, except in the states that chose not to adopt it.

The ₹10 lakh limit applies to "special category states" as defined in the Explanation to section 22. That definition excludes Jammu and Kashmir, Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand, leaving Manipur, Mizoram, Nagaland and Tripura. The 10 states and UTs in the second and third rows are listed in Notification 10/2019 as not covered by the ₹40 lakh goods limit.

Vapi, Valsad, Silvassa and Daman: which limit applies?

Gujarat is a normal state for GST, so Vapi and Valsad businesses supplying only goods register at ₹40 lakh and service providers at ₹20 lakh. Silvassa and Daman fall in the Union Territory of Dadra and Nagar Haveli and Daman and Diu, which is also not in the excluded list, so the same ₹40 lakh / ₹20 lakh limits apply. Remember that a sale from Vapi to a buyer in Silvassa or Daman is an inter-state supply, which matters for goods suppliers (see below).

What "aggregate turnover" means

Aggregate turnover under section 2(6) of the CGST Act is the total value, on an all-India basis for the same PAN, of:

• taxable supplies,
• exempt supplies (including nil-rated and non-taxable supplies),
• exports of goods or services, and
• inter-state supplies between your own branches having the same PAN.

It excludes the value of inward supplies on which you pay tax under reverse charge, and it excludes the GST itself (CGST, SGST/UTGST, IGST and compensation cess). Supplies you make as an agent on behalf of principals are included. If you have branches in more than one state, add them all and compare with the threshold.

Under section 23, a person engaged exclusively in supplying goods or services that are not liable to tax or are wholly exempt does not need to register, even if turnover is above the limit.

A person is still treated as "exclusively supplying goods" for the ₹40 lakh limit even if the only service is earning interest on deposits, loans or advances.

Compulsory registration: section 24

These persons must register whatever their turnover:

1. Persons making any inter-state taxable supply (see the relief for services below).
2. Casual taxable persons making taxable supply.
3. Persons required to pay tax under reverse charge.
4. Persons required to pay tax under section 9(5) (services notified to be taxed in the hands of the e-commerce operator).
5. Non-resident taxable persons making taxable supply.
6. Persons required to deduct tax at source under section 51.
7. Persons making taxable supplies on behalf of other taxable persons as agents.
8. Input Service Distributors.
9. Persons supplying goods or services (other than section 9(5) supplies) through an e-commerce operator required to collect tax at source under section 52.
10. Every e-commerce operator required to collect tax at source.
11. Persons supplying online information and database access or retrieval services from outside India to unregistered persons in India, and persons supplying online money gaming from outside India.
12. Any other person notified by the government on the GST Council's recommendation.

Important reliefs from section 24

• Inter-state services: service providers making inter-state supplies are exempt from compulsory registration until their aggregate turnover crosses ₹20 lakh (₹10 lakh in certain special category states), under Notification No. 10/2017-Integrated Tax. There is no such relief for inter-state supply of goods, so a Vapi trader selling goods to Silvassa or Mumbai must register from the start.
• Small sellers on e-commerce: from 1 October 2023, under Notification No. 34/2023-Central Tax, a person below the threshold can supply goods through an e-commerce operator without registration if they make no inter-state supply, sell through e-commerce in only one state, have a PAN and obtain an enrolment number on the GST portal.

Voluntary registration

Under section 25(3), you can register voluntarily even if your turnover is below the limit. Once registered, all the provisions of the Act apply to you: you must charge GST, issue tax invoices and file returns, but you can also claim input tax credit. It is worth considering if most of your customers are GST-registered businesses that want credit, if you buy a lot of taxable inputs, or if marketplaces or large buyers insist on a GSTIN. If your customers are mainly consumers, voluntary registration can make your prices less competitive.

Frequently asked questions

How TaxEase can help

We check whether you need to register, take care of the application and handle monthly or quarterly returns. See GST registration in Vapi, free GST registration online and GST return filing. You can also use the GST calculator or contact us.