Since the goods and service tax has rolled in since 2017, all businesses that have a turnover of a particular revenue need to register themselves on the GST portal to ease tax filing purposes and ensure all the businesses are following the same format. Only businesses that have registered on the GST portal will be considered as legal businesses and they will be allowed to collect taxes from their buyers and ensure they can carry forward the tax credit to their suppliers.
The goods and service tax was introduced under the, ‘One Nation, One Tax’ system and ideology, to ensure that all the businesses face similar tax filings and situations. Prior to the goods and service tax, businesses would come under different categories and have to taxes at different levels, such as value-added tax (VAT), sales tax, etc. With the introduction of the goods and service tax, every business now pays tax under one head, namely the GST tax.
For individuals or businesses to be registered on the GST Portal, the business needs to have a valid business office and address. But not all businesses have a valid office. Many businesses are conducted via the means of their own homes, making their homes an office for the business. When such a situation arises, a consent letter is needed to ensure that the carryings of the business are safe and sound and no parties have an objection to this kind of business interaction.
What is a consent letter?
A consent letter is basically a no-objection certificate, NOC that is issued in case of a unique business situation. Many businesses registered on the GST Portal conduct business either from the means of their own homes or rent out a property and do the same. When a property is rented out, a lease agreement can be used as the official business document. When the property is owned, the ownership papers can be used for the official business document.
However, when the property is not owned or rented, a unique situation comes up which requires a no-objection certificate in the form of a consent letter. In this such situation, a consent letter is a no objection certificate from the owner of the property or premise, mentioning that they have no problem with the business that is being conducted in their area or house, and they are okay with the registered business or taxpayer conducting their business activities from his or her property.
Since a consent letter is different in a different situation, the government has ensured that is not a set format for the consent letter. Some details need to be mentioned to ensure everything is covered, however, the letter can be written in any format. This is essentially what a consent letter is, in the Goods and Service Tax regime.
What other official steps need to be taken care of while using a consent letter?
Since a consent letter is usually issued in unique situations when the taxpayer is not the owner of the office nor is the office space rented. Because of this unique situation, there are a few other business formalities that need to go hand in hand while submitting the consent letter. Ensure you look up the formalities that your business may be exposed to and you complete them as then the submission of the consent letter will be smooth sailing.
- Ensure the consent letter is signed only by the owner of the premises and no one else. If Mr. A owns the property, but his daughter signs the consent letter, that is not allowed. It has to be the owner of the property.
- Some GST officials might as you to get the consent letter on a stamp duty paper. While this is not mandatory, many officers may ask for this. If given an option, always ask your officer in your area what they prefer, so you do not have to do the work twice.
What is a stamp paper?
A stamp paper is an official document by the government, which is a pre-printed A4 size paper with a revenue stamp of the currency ranging from INR 1, INR 10 and INR 100 or more. A stamp paper is an official paper, making the content printed on the stamp duty verified by the government. It is a type of document that indicates the document is legal.
- While one is uploading the consent form on the GST portal or physically submitting them to the GST officer, they need to ensure the consent form is submitted along with an electricity bill of the registered address or even a Municipal Khata copy or even an Aadhar Card copy. This is required to ensure that the registered business address is legit and that it is being used for business purposes.
- One can upload the consent letter on the GST portal itself without physically going to the office. This can be done by ensuring the following steps are followed:
- Visit the GST portal > Services > Registration > New Registration
- Under the box of nature of possession of premise, since the premise is not owned or rented, the user must choose the alternative and click on the consent letter.
- The consent letter now needs to be uploaded in any form such as JPEG or PDF. However, the user must ensure that the size of the consent letter is no more than 1 MB.
These are a few additional points one needs to keep in mind while uploading a consent letter. The owner of the premises should only sign it. If required, get the consent letter on a stamp paper, provide additional supporting documents when submitting the consent letter and following the steps correctly to upload the consent letter.
A draft of the consent letter format
As mentioned above, since the situation for every consent letter is different, there is no one particular format that needs to be followed to ensure the consent letter is correct. But one needs to ensure that the main required information such as the owner of the house, the address of the house, the name of the business, the permission is given to conduct the business are all mentioned in the letter. Once all the required information is mentioned, it does not matter how the format of the letter is done for the consent letter.
Below we’ve mentioned a draft of the consent letter that can be used by you or your business. We have included most of the information that needs to be added, however, you should also do a final check before you submit the letter and ensure all the relevant information that needs to be covered is mentioned on the consent letter.
NO OBJECTION CERTIFICATE
TO WHOMSOEVER IT MAY CONCERN
This is to certify that I ……………………..(Name of the premise or property owner), being the owner of the property ………………………………………………….(Principle address of the owner or the premise being used) has permitted and allowed ————————————– (Name of the applicant or of the business) for operating and conducting their business from the address mentioned above.
I further state that I have no objection if …………………………. (Name of the Owner or the business) uses the address of the aforementioned premises as their mailing address and postal address.
Owner of the property
Signature (Signature of the owner of the property)
……………………………. (Name of the owner of the premise or property)
If the applicant is a company or a registered business and not an individual, then with consent letter, it also has to submit a board resolution copy in which they will authorize to use such property and the person who shall be authorized to sign on all the documents related to that matter. Ensure that the consent letter is always submitted along with an address proof. The consent letter is also often known as an allotment letter.
In case a business or individual forgets to add a consent letter, then the application will not go through. The GST officer will get in touch with the applicant to ensure the communication is sent and post that, the individual or business can upload a consent letter.