IEC (Import Export Code)
In this era of ruthless clash, people want to advance their trade beyond the borderline of the domestic market. Still, trading globally isn’t just a piece of cake for everybody. Previous to going international, one needs to ensure that the multiple procedures and laws are in place and then get different registrations done along with licenses. IEC (Import Export Code) license is one of such essential when one’s deliberating about importing or exporting from India.
IEC ( i.e an Import Export Code) is needed by anybody who is considering to kick-start his/her import/export trade in the country. It is announced by the Director General of Foreign Trade (DGFT). IEC is simply a 10-digit code which has a continuance validity. Broadly, any importer merchant is not permitted to import goods without the Import Export Code and similarly, the exporter merchants cannot avail the advantages from DGFT for the export scheme, etc. without the IEC.
Enrollment under the GST (i.e. Goods and Service Tax) is the first and foremost step. Without an enrollment, an entity can neither gather tax from its clients nor claim any credit of tax paid by it.
- Enrollment as per the GST is not tax definite, which implies that there is single registration for all the taxes i.e. CGST, SGST/UTGST, IGST as well as cesses.
- Separate Registration for each state/UT- if operating in multiple state/UT
- Single PAN based registration in one State/UT. [Section 25(2)]
- Under GST, registrations need to be taken State-wise, i.e. there are no centralized registrations under GST. Any specific entity with offices in multiple States will have to take separate State wise registration for the offices in different States.
An IEC is needed under the following conditions:
- In case a shipper has to clear his consignment from the duties in that case, it is required by the customs authorities.
- When a shipper needs to transmit money abroad through financial institutions then it’s needed by the particular financial institution.
- When a merchant has to dispatch his sconsignments then it’s required by the customs port.
- When a merchant transfers funds in foreign currency directly into his bank account then its required by the bank.
GST Registration for Importers
GST enrollment is binding for taxable entities as per GST. In a number of states, companies with an annual accumulated turnout of more than INR 20 lakhs (Also INR 10 lakhs,in some states) would be needed to acquire GST enrollment. Along with this, the turnover criteria and other circumstances have also been specified by the GST Council. Nevertheless, all importers would be needed to compulsorily acquire GST enrollment, as GSTIN is now needed for clearing goods from Customs Department.