How to verify GST number online with easy steps?

Table of Contents

• Why GST number Verification is Important?
• Process to Verify GSTIN number Online
• How to search for GSTIN with PAN details?
• How to Understand a fake GST number?
• Benefits of verification to businesses
• Common mistakes to avoid
• Legal Implications
• Case studies
• Conclusion

When you register your business on the GST portal, you are provided with a unique 15 digit GST number, popularly known as GSTIN. As a business, GST number verification is important to confirm its authenticity. It’s a simple and straightforward process and can be done on the GST portal.

Let’s understand the GST number verification process and why it’s important for your business to do so.

Why GST number Verification is Important?

GST number verification refers to the process of verifying or confirming the authenticity of a GSTIN to ensure it is valid and registered under the GST system in  India. Verification of GSTIN enables a business owner to:

• Prevent fraudulent transactions (i.e, no fake invoices as all invoices/GST e-invoices come with GSTIN)
• Ensure business compliance as per GST laws
• Facilitate accurate ITC claims (i.e, matching supplier GSTR based on GSTIN)
• Authenticate supplier credibility
• File GST returns appropriately based on GSTINs

This process ensures compliance, avoid GST related issues and operate business seamlessly.

Process to Verify GSTIN number Online

GSTIN number helps to track transactions and GST payments, based on which claims for Input Tax Credit can be made. As such, when it comes to adherence to GST compliance, it’s vital to confirm a GST number. Here’s how you can check the validity of a GST number on the GST portal:

• Visit the official GST website: //www.gst.gov.in/
• Click on ‘Search Taxpayer’ on the main menu bar
• Select ‘Search by GSTIN/UIN’ from the dropdown option
• Enter the GSTIN/UIN of the taxpayer (this is mandatory)
• Submit request by clicking ‘Search’
• View details of your search query

At this point, if you have provided a valid GSTIN number you will get to see the basic business details of the same – legal name, business name, address, date of registration, status, etc. As such, it is important that you enter the right GSTIN, as even a minor digit error can lead to zero results or incorrect responses.

How to search for GSTIN with PAN details?

You can now view the list of GSTINs against the PAN number along with its status and state of registration. We have created a detailed guide on how to search and download the GST certificate by PAN number.

How to Understand a fake GST number?

A benefit of verifying GST numbers is that it allows you to identify fraudulent activities and report them proactively to avoid GST notices for penalties and fines and other legal complications. While you can do so using the Helpdesk contact details, it can also be done online on the portal while searching or checking a GSTIN authenticity.

Here’s how you can identify and complain about a fake GST number using PAN details:

1. Visit the GST portal and follow the path: Search Taxpayer > Search by PAN > Enter PAN number
2. Click ‘Search’ to view list of GSTINs under a specific PAN
3. Check ‘Select to Report’ against any unrecognised/fake GSTIN
4. Provide details as requested and enter OTP for verification
5. Complete the e-KYC (via Aadhaar) and consent to GSTN authentication
6. Complete the process by validating with the second OTP received

All of the GSTINs follow a standard format:

• The first two digits represent the GST state code
• The next 10 digits is the PAN number
• Next is the entity code or registration number of the entity in the state
• This is followed by the default number/alphabet by the system
• Last is the checksum digit for error detection

The GSTIN will appear in all your invoices. As such, ensure that your GSTIN is correctly generated and you are using the right GSTINs of your suppliers and customers to ensure you are compliant with GST rules.

Benefits to the business

GSTIN verification therefore will enable your business to:

• Conduct business seamlessly across cities and states
• Reduce fake invoices or duplication, tax evasions and other fraudulent activities
• Claim Input Tax Credits during GST return filing (i.e., ensuring data accuracy in GSTR-2B for filing GSTR-3B)
• Track transactions and payments (sales and purchases)

Note: If your business is operating in different states, you will need to get GSTINs separately. That is, register separately for each state.

Common Errors and How to Avoid Them

While the process of verifying a GST number is straightforward, businesses often make common mistakes that can lead to complications. Here’s how to avoid them:

1. Entering Incorrect GSTIN: A minor mistake in typing the GSTIN, such as swapping digits or entering incorrect characters, can result in invalid results. Always double-check the GSTIN before submission.
2. Failure to Regularly Verify GST Numbers: Businesses may assume that once a GSTIN is verified, it remains valid indefinitely. However, a GST number can be canceled or suspended. Regular verification helps you stay updated and avoid dealing with non-compliant entities.
3. Relying on Third-Party Tools: While third-party GST verification tools can be convenient, they may not always be accurate or up-to-date. It’s best to use the official GST portal for verification to ensure accuracy.
4. Overlooking GSTIN Format: Not understanding the format of a GSTIN can lead to errors in validation. For instance, knowing that the first two digits represent the state code and the next ten digits represent the PAN can help you quickly spot obvious errors.

By avoiding these common pitfalls, your business can maintain a high level of compliance and reduce the risk of financial and legal repercussions.

Legal Implications of Not Verifying GSTINs

Failing to verify the GST numbers of your suppliers or customers can lead to serious legal consequences. If you inadvertently engage in transactions with a business that is using an invalid or fake GSTIN, you could face penalties for non-compliance, including fines and interest on unpaid taxes. Additionally, your ITC claims could be denied, leading to higher tax liabilities.

The GST law mandates that businesses only transact with registered entities to ensure the integrity of the tax system. Therefore, taking the time to verify GST numbers is not just a best practice but a legal obligation that protects your business from potential audits and legal scrutiny.

Case Studies: Real-Life Examples of Businesses

Consider the following real-life scenario:

• Case Study 1: The Cost of Not Verifying a GST Number
  • A small manufacturing business neglected to verify the GST number of a new supplier. When the supplier’s GSTIN was later discovered to be fake, the business faced penalties and was unable to claim ITC for a significant amount. This oversight not only led to financial loss but also damaged the company’s reputation with tax authorities.
• Case Study 2: Benefits of Regular GSTIN Verification
  • A logistics company implemented a policy of verifying GST numbers before every major transaction. This practice helped them avoid engaging with non-compliant vendors, ensuring smooth GST return filings and accurate ITC claims, ultimately leading to significant tax savings.

These case studies illustrate the tangible benefits of regular GST number verification and the potential risks of overlooking this crucial step

Conclusion

GST number verification is an essential part of maintaining business compliance in India. By regularly verifying GSTINs, avoiding common errors, and understanding the legal implications, your business can operate smoothly, avoid fraudulent transactions, and ensure that you are fully compliant with GST laws.

Make GST number verification a regular part of your business process to safeguard your transactions, optimize your ITC claims, and protect your business from potential legal challenges.

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Author: Anirban Sinha

A product manager with a writer’s heart, Anirban leverages his 6 years of experience to empower MSMEs in the business and technology sectors. His time at Tata nexarc honed his skills in crafting informative content tailored to MSME needs. Whether wielding words for business or developing innovative products for both Tata Nexarc and MSMEs, his passion for clear communication and a deep understanding of their challenges shine through.