Almost every article says GST is mandatory above Rs. 20 lakh. For most businesses in Tamil Nadu that number is wrong, and being wrong in either direction costs you.
Ask ten business owners in Chennai when GST registration becomes mandatory and nine will say Rs. 20 lakh.
For a large share of them, that is the wrong number, and it is wrong by twenty lakh rupees.
We should say plainly that our own website carried the loose version of this until recently. It is an easy thing to get wrong, which is exactly why it is worth writing about.
In Tamil Nadu, a normal category state:
So a trader selling only goods can reach Rs. 39 lakh in turnover with no GST registration required. A consultant crosses the line at Rs. 20 lakh.
And the catch that traps more people than anything else: if you supply even a small amount of services alongside your goods, the Rs. 20 lakh limit applies to your whole turnover.
A hardware shop with Rs. 35 lakh of sales and Rs. 50,000 of installation charges is a mixed supplier. The Rs. 20 lakh threshold applies. That business needed GST registration fifteen lakh rupees ago.
Aggregate turnover is not your taxable sales. It is broader, and it is calculated across all of India under the same PAN, not per state and not per branch.
It includes taxable supplies, exempt supplies, exports, and inter-state supplies. If you hold two businesses under one PAN, they are added together.
This is where people miscount. A business with Rs. 15 lakh in taxable sales and Rs. 8 lakh in exempt supplies has an aggregate turnover of Rs. 23 lakh, not Rs. 15 lakh.
Some categories must register from the first rupee, whatever the turnover. Under Section 24 of the CGST Act this includes:
The e-commerce one catches people constantly. If you sell on Amazon, Flipkart or Meesho, you need GST registration on day one with Rs. 0 turnover. The platform will not onboard you without it.
Most registration disputes trace back to one of two errors: under-counting aggregate turnover, or missing a Section 24 category that made registration compulsory from the start.
Registering late is not a paperwork issue. It is a financial one.
You owe the tax anyway. GST becomes payable from the date you crossed the threshold, not from the date you registered. If you crossed in June and registered in December, you owe six months of output tax.
You cannot recover it from customers. You invoiced them without GST. Going back to ask for 18 percent more, months later, rarely ends well. It comes out of your margin.
You lose the input tax credit. Credit on purchases made before registration is largely unavailable. So you pay output tax on those months while getting no credit for what you bought.
Interest and penalty apply on top.
The compounding effect is the point. A business that crosses Rs. 20 lakh in July and realises in March is not facing a fine, it is facing a bill for tax it never collected.
Voluntary registration is legal and sometimes correct. But it is a commitment, not a badge.
Once registered you must file returns every month or quarter, including nil returns in months with no business at all. Miss them and late fees accrue per return per day. Continue missing them and the registration is cancelled, which is far harder to unwind than it was to obtain.
Register voluntarily when it genuinely helps: your customers are GST-registered businesses who want input credit, you have substantial input tax to reclaim, you are approaching the threshold anyway, or a platform or tender requires it.
Do not register because you think it looks professional. A dormant registration generating late fees looks considerably less professional than not having one.
If your turnover is modest and your customers are mostly consumers rather than businesses, the composition scheme may suit you better. Flat rate, quarterly payment, simplified returns.
Limits: Rs. 1.5 crore for goods suppliers in normal states, and Rs. 50 lakh for service providers and mixed suppliers, who pay 6 percent, being 3 percent CGST and 3 percent SGST.
The trade-off is real. Under composition you cannot claim input tax credit, and you cannot pass credit to your customers. That makes you unattractive to business buyers and is why it suits retail and direct-to-consumer far better than B2B.
Three questions.
One. Add every rupee of income under your PAN for the current financial year, including exempt income and any other business you run. That is your aggregate turnover.
Two. Do you supply only goods, or do you supply any services at all, even incidentally? Only goods means Rs. 40 lakh. Any services means Rs. 20 lakh.
Three. Do you fall into any Section 24 category, particularly inter-state supply or e-commerce? If yes, the threshold is irrelevant and you should already be registered.
If you are within about Rs. 5 lakh of your threshold, start the process now. Registration takes three to seven working days, and crossing the line while the application is pending is a bad position to be in.
Do not wait for a notice.
Registering voluntarily and disclosing the position is materially better than being found. The liability is the same, but the treatment of penalty is not, and a voluntary disclosure is viewed very differently from a detection.
This is a situation worth talking through with someone before you file anything, because how the disclosure is framed affects the outcome.
Thresholds verified as at August 2026 against the CGST Act and GST Council notifications. Tamil Nadu is a normal category state. Special category states, largely the North Eastern and hill states, apply lower limits.
GST registration: Rs. 999, all inclusive. There is no government fee for GST registration.
Monthly filing: Rs. 1,499 a month, covering GSTR-1 and GSTR-3B, reconciliation and deadline tracking.
If you tell us your turnover and we conclude you do not need to register yet, we will say so. That costs us Rs. 999 today and saves you a filing obligation you did not need.
Not sure whether you have crossed the line? Thirty minutes with a qualified professional for Rs. 249. Bring your turnover figures and we will work it out properly, including what to do if you crossed it some time ago.
Message us. We answer properly, whether or not you become a client.