Goods and services tax, or GST, is a service tax that governments worldwide have relied upon for various government projects. Regardless of the size, GST registration is compulsory for every organization. However, many entities still struggle with this indirect consumption tax when it comes to GST verification.
In the Indian context, particularly, the GST or GSTIN (issued by the government) is a 15-digit unique number based on the Permanent Account Number (PAN). The absence of GST verification increases the likelihood of fraudsters bypassing the set procedures, thus causing losses to financial institutions.
Today we will learn more about GST verification numbers and why it is necessary to verify GSTIN numbers.
What is GSTIN?
GSTIN is a 15-digit unique number allotted to businesses based on the PAN. It is public information that every business owner must display on their business invoices, letterheads, and other business documents.
It is important to note that GSTIN also reflects the various aspects of the business. These are-
- The first two digits of GSTIN represent the state code (the place of business incorporation).
- The 10 digits after the state code of the GST number reflect the PAN number of the individual (the one who has registered the business).
- The final three digits of GSTIN represent the number of registrations the business has done, Z (as default), and either an alphabet or number for error detection.
GSTIN is useful when a business transacts with another business for goods or services to ensure it’s not dealing with a fraudulent company.
Why Is It Important to Verify It?
Deploying a process to verify GSTIN numbers is a simple and effective way to prevent GST registration fraud in the early stages and verify a business’s legitimacy.
GST verification numbers help in the following:
- Depicting a business entity’s credibility to various stakeholders, including customers, financial institutions, business partners, and other public bodies.
- GST verification shows legitimacy and eligibility to claim input tax credits.
- Allows to cross-check the business identity, its dealings, and other commercial transactions
Overall, business GSTIN verification is critical for all GST-registered organizations, irrespective of their size. Verified GSTINs create a mutually beneficial environment where you can cross-check if you are dealing with credible businesses while proving your authenticity.
Tip: Razorpay’s GST search by PAN tool enables you to discover various GSTINs linked to a PAN card.
Use Razorpay GST Calculator to compute the payable GST based on different tax slabs.
How Does The GSTIN Search And Verification Tool Help In the Process?
GSTIN search, and verification tool is a facility that allows you to avail of GSTIN search facility within a single click. Using the tool, you can also check the GST number and do GSTIN verification.
The tool helps you-
- Spot a fake and an invalid taxpayer.
- With GST status verification, you can claim the correct input tax credit, which cannot be authenticated otherwise(in case of an incorrect GST number).
- Check the authenticity and validity of any GSTIN.
- Prevent connection with businesses or sellers who use fake or forged GSTINs.
- Simplify the verification process.
- Prevent instances of fraud.
- Correct any potential errors or inaccuracies in GST reporting.
GSTIN verification and GST verification number are crucial steps that can help you protect yourself from fraudulent elements. Since GST registration and verification is a complex process involving multiple compliance sets, it is best to leverage an advanced solution. This can help you save both time and money and improve your productivity at the same time.
Suppose you are looking for an all-inclusive GSTIN search and verification tool. In that case, Razorpay offers an excellent tool that helps you verify the authenticity of any GSTIN for free of cost online.
Razorpay’s search and verification tool help you easily verify the validity of a GST number and also helps you understand whether a vendor has a fake GST number. Moreover, the tool also allows you to verify the GST number of your own business too.