Letter of Authorization for GST Registration (4 Format)

A Letter of Authorization is simply a legally enforceable document that assigns responsibility for carrying out business operations on behalf of the company/firm and its owner to a third party (usually an employee/company). A letter of authorization can be used in various situations and for various business purposes other than GST. 

What is a Letter of Authorization for GST?

One of the most important business requirements is a letter of authorization for GST to do routine business transactions as per GST Law. The person who has been given this authority to act on behalf of the firm/company is known as “Authorized Signatory”.

What is the need for GST Letter of Authorization

In the case of every business entity excluding sole proprietorships or businesses conducted by a single person, a letter of authorization for GST is required to carry on day-to-day GST work in a firm/company. Even a sole proprietorship firm can give a Letter of Authorization to its employee to handle routine GST work of the firm. Generally, the Letter of Authorization is required for the following purposes under GST:-

1. For Registration under GST Act.
2. For any amendment or cancellation of registration under the GST Act.
3. For Signing the documents like GST Returns, Invoice, other GST forms to be uploaded on GST website or to be submitted physically to GST department.
4. For filing reply to any Notice or Query/Clarification of GST department.
5. For any other correspondence with the GST department on behalf of the firm/company.

Letter of Authorization for GST Registration

• When applying for Registration of GST (Reg -1 form), it is mandatory to provide the name, address, and other information of the person acting as the Authorized Signatory while registering for GST of the firm/company. 
• The Letter of Authorization needs to be uploaded in PDF format with the Application form of Registration on the GST Portal. 
• In the case of a sole proprietorship, however, any additional authorized signatory is not mandatory. An authorized Signatory can be the proprietor himself. 
• In the case of a company (Public company or Private company, or One Person Company), the GST Authorization Letter must be accompanied by a copy of the Board Resolution. 
• It is also mandatory to upload a copy of the Board Resolution on the GST Portal and the Authority Letter. 
• Similarly, in the case of a Partnership firm, the Letter of Authorization needs to be signed by all the firm partners. 
• It is pertinent to mention here that any Director of the company or any Partner of the firm can also act as Authorized Signatory.

Sample Format of Board Resolution for Letter of Authorization in GST

Contents of Authorization Letter for GST

There is no standard format or pattern prescribed for the Letter of Authorization to be submitted to GST authorities. Although there are different formats of Letter of Authorization for different purposes available on various platforms/websites, generally, there are some basic details that need to be filled in the Letter of Authorization by business owners so that it becomes meaningful and acceptable to GST authorities.  

The basic details required to be filled in the Letter of Authorization for GST authorities are as under:-

• Name of the Business Organisation
• Address of the Business Organisation (with Address proof)
• Telephone No. of the Business Organisation
• E-mail ID of the Business Organisation (Generally, all these details are available / printed on the letterhead of the firm/company)
• Name of the Applicant (Owner, i.e. Partners/Directors etc.)
• Name of the person to whom authority is being given
• Designation of the person in the firm/company (to whom authority is being given)
• Address of such person (Authorized Signatory) (PAN Card & Aadhaar Card of such person to be uploaded on GST Portal towards address proof & identity proof) 
• A Statement of Acceptance by such person to act as Authorized Signatory of the firm/company
• Date, Place & Signature of both parties (Owner & Authorized Signatory)

Also Read: Difference Between VAT and GST

Sample Declaration formats of Letter of Authorization for GST purposes 

Letter of Authorization for GST Registration

1. Declaration for Authorized Signatory (new registration)

2. Declaration for Authorized Signatory (existing registration or existing business)

Letter of Authorization for GST by a Proprietor

Any person doing business individually in his name or the capacity as a proprietor of their sole proprietorship firm need not file any Letter of Authorization in GST Portal at the time of registration or subsequently for the appointment of any third party as his Authorized Signatory. It is not mandatory. But let’s suppose a proprietor wants to appoint any third party like their employee or any other person as their Authorized Signatory for GST purposes. In that case, they will have to file a Declaration for Authorized Signatory in the same format as already given above. Sole proprietorship firms generally give a Letter of Authorization to their employees/any other person for smooth compliances of GST Law.

Authorized Signatory Vs. Authorized Representative under GST

Although no difference has been defined between an Authorized Signatory and an Authorized Representative under the GST Act or under the GST Rules, but still for practical purposes, there is some difference between the two. The difference can be understood in the following paragraphs:-

Authorized Signatory:

• An Authorized Signatory is the person who is given the responsibility by the firm/company/business owner to do the routine business transactions of the business entity. 
• They comply with various provisions and rules of GST Law on a day-to-day basis like Registration under GST or amendment in registration under GST, signing of invoice and other documents, filing of GST returns, filing of an application for GST Refund, other forms on GST Portal or physically with the GST Department.
• They also reply on behalf of the firm/company to routine Notices or Queries, etc., of the GST department or any other correspondence with GST Authorities. 
• Such a person is generally an employee of the company or any other third person who is regularly associated with the firm/company. All the acts of an Authorized Signatory are binding on the business entity.

Authorized Representative:

• An Authorized Representative can be a person as given in Section 116(2) of GST Act, 2017. 
• An Authorized Representative is a person who is appointed or authorized by the firm/company/business owner to represent the company/business entity before the GST authorities to reply to any Notices, Summons, etc. 
• They also handle assessment, appeals, revision of any Order or any other similar type of work under the GST Law. 
• Such person is generally an Advocate or a Chartered Accountant/Cost Accountant/Company Secretary in practice or any Employee of the business entity or any Retired Officer of GST Department in practice as permitted by GST Law. 
• Usually, such persons are appointed by means of a Power of Attorney. A Board Resolution is also required in addition to Power of Attorney if any such person is appointed as Authorized Representative in case of a company. 
• All the representations made by the Authorized Representative before the GST Authorities are binding on the firm/company/business entity appointing such person.

Also Read: Direct And Indirect Expenses

Conclusion

The purpose of writing this article is to make everyone understand the Letter of Authorization for GST and clarification to act as Authorized Signatory and the difference between an Authorized Signatory and an Authorized Representative. This article will also help you understand the Letter of Authorization for GST Format.