When starting a business, you must take care of several legal and administrative tasks. These include specific registrations, licenses, formal permissions, and delegations. One such document is the Letter of Authorisation or LOA.
LOAs are important legal documents, and they are usually used to assign the responsibility of carrying out certain business operations to a third party on behalf of your company or firm. It can be used for several different situations and business purposes. This article delves into what an authorisation letter for GST is, why it is important, and more.
What is a Letter of Authorisation for GST?
For companies with turnovers higher than Rs. 20 lakhs, collecting and paying the Goods and Services Tax (GST) is necessary. LOAs become a must when carrying out any business transactions per GST regulations. A GST calculator can also help determine how much GST is payable on a transaction.
Most firms assign the responsibility of managing GST proceedings to a designated individual. They are typically responsible for filling out forms, visiting the GST office, and taking care of other responsibilities. However, they are usually not an owner of the business. Because of this, GST officials need some way to determine if they represent the business and are responsible for its accounts.
This is where a letter of authorisation for GST comes in. An owner of the business will sign an LOA stating that the individual has been given the authority to conduct activities on behalf of the company. These employees may also be termed as “Authorised Signatories.”
While GST LOAs are not necessary for sole proprietorships, they are required for most other types of business entities. These include limited liability partnerships, general partnerships, companies, and trusts. These entities can benefit from designating GST-related responsibilities for individuals, ensuring smoother business operations. It is beneficial for businesses that have multiple locations across the country.
What Information should be Included in an LOA for GST?
A letter of authorisation should include all relevant information about the business and the signatories. This includes:
– The details of your business: This includes the registered name of your business, the firm’s official address, contact details, GSTIN, and taxpayer’s details.
– The authorised person’s details: This includes the name(s) of the authorised signatory, their designation, contact details, and the start and end date of the authorisation’s validity.
– Other information: This includes Aadhaar and PAN card details, the date, place, and necessary signatures. It is also essential for your company’s letterhead to be used when issuing this letter.
What is the Format for a Letter of Authorisation for GST?
The letter of authorisation for GST usually does not necessarily follow a specific format. However, some key components to include in your letter include:
1. The header
Like any other letter, starting with a header at the top is crucial. This includes the business’s name, registered address, and GSTIN (Goods and Services Tax Identification Number). It is used to identify the business accurately.
2. The date
This is the date on which the LOA is being issued. It is important to validate the document and maintain accurate records.
3. The recipient’s details
Up next is the address of the relevant tax authority or department. This should be stated clearly to avoid any confusion.
4. A salutation
Again, like any other formal letter, an LOA should have a formal salutation (like Dear Sir/Ma’am).
5. The body of the letter
The body of the letter has some distinct sections as well. These include:
– An introduction
– Authorisation statement (all relevant details, such as the person’s name, Aadhaar, PAN, contact information, and more)
– The scope and duration of authorisation
– Closing
6. Signature
The final section includes the signatures of the business owner or whoever is granting authorisation. This should also include the authoriser’s name, contact information, and designation underneath.
How do you submit a letter of authorisation for GST?
To submit a letter of authorisation for GST, the following steps can be followed:
1. Prepare the letter and ensure all relevant information is included.
2. Visit the GST portal and upload it.
3. Submit any required documents and the letter of authorisation for GST registration.
4. Ensure that you have a copy in your records as well.
Wrapping Up
The letter of authorisation for GST is a vital document that can help you conduct your business activities smoothly, adhere to legal compliances, improve management, and more. Another important aspect of successfully running a business is financing. This is where MSME loans come in.
If you are looking for funding options for your business, consider a business loan from Tata Capital. We offer competitive interest rates, flexible loan tenures, minimal documentation and more. Head to Tata Capital’s website or download the app to learn more!
FAQs
To write a GST LOA, include key details like the company's letterhead, owner's information, business name and address, authorised signatory's details, and more. Maintain a professional tone and specify the authorisation's validity date.
Businesses must maintain a formal tone when writing a GST consent letter and include recipient and business details. Grant permission, and add the signatory's details, validity period, signatures, and dates.
To add an authorised signatory, you must visit the GST portal, select the "Services" tab, choose "Registration," click on "Authorised Signatory" from the menu, and click "Add New."
To write an appeal letter for GST, one must visit the GST portal and log in with valid credentials. They must then go to "Services," "User Services," "My Applications," and click "Appeal to Appellate Authority."
A GST registration is usually approved in 30 calendar days. However, it may be longer if any issues with the registration are raised.
18 March 2025
4 mins read
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