For the purpose of taxation, the GSTIN becomes very important for manufacturers, suppliers and traders when conducting transactions. The GSTIN is what the government uses in determining the quantum of tax after looking at corresponding invoices. For increased compliance, care must be taken to ensure that the GSTIN is used appropriately wherever necessary to ensure that taxation is done in the right manner.

As known to all, GSTIN (Goods and Services Tax Identification Number) is a 15 digit ID. 

Knowing the structure of the GSTIN is important for a business for the following reasons: 

• To ensure that one’s suppliers have quoted the correct GSTIN in their invoices 
• To ensure that one mentions their own GSTIN correctly in invoices to customers – as input tax credit is dependent on this 
• To ensure that appropriate taxes (whether IGST or CGST and SGST) are charged e.g. If the Supplier state code and  the “Place of supply” state code are different, then IGST will be charged 
  
  

The 15 digit ID comprises of:

1. 2 digits signifying the state code: Digit 1 & 2

GST State Code List of India: This state code list under GST is prescribed as per the Indian Census of 2011, and is given below.

2. 10 digit PAN number: Digits 3 – 12 represent the PAN of the entity, so that a nexus can be established between the GST and the PAN database. 

3. 1 digit signifying number of registrations: Digit 13 is entity code, which signifies number of registration that an entity has taken within a particular state. It would be pertinent to note that a new registration in a different state will have GSTIN starting with a different state code. A registered person with single registration within a State would have number 1 as 13th digit of the GSTIN. If the same registered person gets a second registration for a second business in the same State, the 13th digit of GSTIN assigned to this second entity would be 2 and so on. 

4. 2 digits having default and checksum values: Last two digits are for the purpose of check digit. 

To explore business opportunities, link with me by clicking on the 'Invite' button on my eBiz Card.   

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views, official policy or position of GlobalLinker.