GST on products

General
1

Our organization works with women artisans who make handicrafts. We help them sell these products through a small shop and also on our website. The total sales are around Rs 13LPA.

Do we need to register for GST? I am confused if this is considered as business income for a non-profit.

2

Thanks for your query.

  1. The threshold for taxable supply under GST for obtaining registration is turnover of Rs.40 lakhs (goods) for taxpayer in normal category state in a financial year. In this case, since the threshold has not been crossed, registration is not required.
  2. The test whether business income as for above is permissible and in line with charitable status is to check whether such business income is incidental to your charitable object as selected from objects specified in section 2(15) of Income Tax Act. If it is so, the income will be charitable. Proving such income is business incidental is on assesse before tax authority . If you are in the first six limbs of section 2(15), such business income does not have a ceiling, however, it is 20% of total receipts in case the income is under the seventh limb i.e. General Public Utility.

Hope it clarifies.

CS Sharad Bhargava