How to Obtain ISD Registration under GST: A Complete Compliance Guide

Running a multi-branch business? Managing Input Tax Credit (ITC) across states can be a headache without ISD Registration under GST. Don’t worry! the process is simple, and getting registered will keep you compliant while streamlining your GST operations!

Read on to explore the step-by-step process, required documents, and FAQs, all in one place.

What is ISD Registration under GST?

Input Service Distributor (ISD) under GST refers to a head office or registered location of a business that receives invoices for input services used by multiple branches. The ISD does not provide any outward supply, instead, it distributes the input tax credit (ITC) to its other branches (with the same PAN) in different states.

To act as an ISD, the business must obtain a separate ISD registration under GST.

How Does the ISD Mechanism Work?

Let’s say a company has its Head Office in Mumbai and branches in Delhi, Chennai, and Bengaluru. Suppose the Head Office receives a consultancy service invoice used across all locations. In that case, the GST credit on that invoice can’t be claimed by the Head Office itself, since it isn’t making any outward taxable supply.

Here’s where the ISD mechanism comes in:

1. ISD receives the input service invoice.
    
2. It issues an ISD invoice to each consuming branch (Delhi, Chennai, Bengaluru) for their respective share of the credit.
    
3. Each branch claims the ITC in its GST return based on the ISD invoice received.

This way, the credit doesn’t go to waste and is rightfully claimed by the branches consuming the service.

📌 Key Points to Remember: ISD is only for input services, not goods or capital goods. It ensures fair and proportionate distribution of GST credit. All units must have the same PAN to be eligible for ISD distribution. ISD registration is mandatory for the office distributing credit.

 

Documents Required for ISD Registration under GST

Before you jump into the ISD registration process, make sure you’ve got these essentials lined up. Having them ready will make your online application smooth and hassle-free:

Business Identification Documents

• PAN Card of the business or company
• Copy of Existing GST Registration Certificate: From the regular GST registration (if already registered).
• Proof of Business Constitution:  MOA, AOA, Certificate of Incorporation for companies; Partnership Deed for firms; LLP agreement, etc.
• Details of Business Activity: Description of the services procured and distributed.

Address & Premises Proof

• Proof of address of ISD office: a recent utility bill, rent agreement, or property tax receipt
• Bank Account Proof: Cancelled cheque or recent bank statement of the business entity.

Authorized Signatory & Compliance

• Identity and Address Proof of Authorized Signatory:  Aadhaar Card, Passport, Voter ID, etc., along with a recent photograph.
• Board Resolution or Authorization Letter: authorizing the person filing the application
• Digital Signature Certificate (DSC): of the authorized signatory
• Valid Mobile Number and Email ID: for OTP and communication
   

Additional Documents (If Required by GST Officer)

• List of input service invoices
• Agreements with vendors
• ITC distribution summary
• Financial Statements & Self-Declaration (To confirm GST compliance)

Pro Tip: Scan all documents in advance. Keep file sizes within the portal’s limit to avoid delays during upload.

How to Apply for ISD Registration under GST Online?

Registering as an Input Service Distributor (ISD) under GST is essential for businesses that need to distribute input tax credit (ITC) for common services across multiple branches. Here's a step-by-step guide to the ISD registration process in India:

1. Visit the GST Portal

Begin by accessing the official GST registration portal: 🔗 https://reg.gst.gov.in/registration/

2. Filing GST REG-01

Fill out the GST REG-01 form. In Serial No. 14, select the ISD status to apply specifically for ISD registration.

3. Generate TRN (Temporary Reference Number)

Provide details like:

• Legal name of the business
• PAN, state, and district
• Valid email ID and mobile number

Once verified via OTP, a TRN is generated for proceeding with the application.

4. Complete the REG-01 Application

Log in using the TRN and fill in:

• Principal place of business
• Type of premises
• Details of promoters/partners

Upload required documents such as:

• Business proof
• Bank details
• ID/address proofs of key personnel

5. Verification by Tax Authorities

The application is reviewed for accuracy. Upon approval, a unique GSTIN with ISD status is issued.

6. ISD GSTIN Issuance

Businesses receive a separate GSTIN for ISD purposes. Please note that this is distinct from the regular GST registration.

7. Start ITC Distribution

Once the ISD GSTIN is active, the business can begin distributing input tax credit to its branches, as per GST rules.

What is the Latest Amendment of ISD in GST?

Starting 1st April 2025, ISD registration under GST becomes mandatory for eligible businesses vide Notification no. 16/2024 CT dated 06.08.2024.

What is the new law?

The GST Council has made it compulsory for units distributing Input Tax Credit (ITC) to obtain ISD registration under GST from April 1, 2025.

Why has ISD registration been mandated?

This move is aimed at:

• Bringing uniformity in ITC distribution
• Avoiding misuse or incorrect credit transfer
• Ensuring transparency and compliance across GST filings

What was the previous rule?

Earlier, registering as an ISD was optional. Businesses could choose to distribute common input credits without a separate ISD registration. However, this led to inconsistent credit practices and audit issues.

Are there penalties for not complying?

Yes! Failing to obtain ISD registration while distributing ITC can attract:

• Interest on wrongly availed/distributed ITC
• Penalties under Sections 122 and 125 of the CGST Act
• Possible reversal of credit and audit notices

Common Mistakes to Avoid During ISD Registration

Even simple errors can delay your ISD registration or create bigger compliance troubles later. In fact, these are some common startup compliance mistakes most businesses make during the process:

• Registering a branch office instead of the head office as ISD - Always choose the central unit.
• Using an outdated mobile number or email can block OTPs - Keep your contact details updated.
• Uploading incorrect or mismatched documents leads to rejections - Double-check everything before submission.
• Forgetting to file GSTR-6 monthly can trigger penalties and ITC issues - Stay on top of due dates.

Conclusion

If your business has branches across states, ISD registration under GST is now essential. With the new rule effective from April 1, 2025, timely compliance is key. Avoid penalties and ITC issues — get your documents ready, apply online, and stay ahead. Don’t wait till the last moment — lead with compliance and register today.

FAQs

Q. Can I do ISD registration under GST myself?

Yes, you can apply for GST and even ISD registration under GST online through the GST portal. It’s a self-service process—just keep your documents handy. For smoother and error-free filing, a bit of professional guidance always helps!

Q. What is the turnover limit for ISD registration under GST?

There is no turnover limit specified for ISD registration under GST. If you're distributing input services across branches, ISD registration is required regardless of turnover.

Q. Why is ISD registration required?

ISD registration under GST is required to distribute Input Tax Credit (ITC) from the head office to branches. It ensures compliance and prevents credit mismatches in multi-location businesses.

Q. Is ISD registration mandatory under GST?

Yes, as per the latest amendment of ISD in GST, ISD registration is mandatory from 1st April 2025 for businesses distributing ITC across multiple locations.

Q. Can I use the same GSTIN for ISD and regular operations?

No, ISD registration requires a separate GSTIN. You cannot use the same GSTIN for both ISD and regular taxable operations.

Q. Can a single unit have both GST and ISD registration?

Yes, a single legal entity can have both regular GST and ISD registration under GST. However, they must be registered separately and used for their respective purposes.