Everything You Need to Know About Tax IDs for Your Startup

Starting a business in Andhra Pradesh? One of the first things you’ll hear is “you need a tax ID.” It sounds bureaucratic, but it’s the key to opening a bank account, filing taxes, and building credibility with investors. In this guide we break down what a tax ID is, the types you’ll encounter in India, and how to get one without the headache.

What Exactly Is a Tax ID?

A tax identification number (TIN) is a unique code that the tax department uses to track your business’s financial activity. In India the most common TIN is the GSTIN (Goods and Services Tax Identification Number). If you plan to sell goods or services across state lines, you’ll need a GSTIN. For startups that also operate abroad, you might need an EIN (Employer Identification Number) from the US IRS if you have US‑based investors or employees.

How to Register for a GSTIN (India)

Getting a GSTIN is a straightforward online process, but you’ll need a few documents ready:

• Active PAN card for the business or its partners.
• Proof of business address (rent agreement, utility bill, or property deed).
• Bank account details in the name of the entity.
• Certificate of incorporation if you’re a private limited company.

Log in to the GST portal, fill out the application, upload the documents, and submit. Within a few days you’ll receive a 15‑digit GSTIN that looks like 27AAEPM1234C1Z5. Keep a copy handy – you’ll need it on invoices, contracts, and when filing GST returns.

If your turnover is below the 20‑lakh exemption limit, you can technically skip GST registration, but most startups opt in anyway. It shows investors you’re serious about compliance and gives you the ability to claim input tax credit on purchases.

When Do You Need an EIN (US Tax ID)?

An EIN isn’t mandatory for Indian startups unless you have a legal presence in the US – like a subsidiary, a US‑based employee, or foreign investors who require reporting. The application is free and can be done on the IRS website. You’ll need:

• A legal name and address for the entity.
• A responsible party’s SSN or ITIN.
• The type of entity (LLC, corporation, partnership, etc.).

After a quick online fill‑out, the IRS emails you the number instantly. Record it in your financial software; it’s used for US tax filings and opening US bank accounts.

Pro tip: If you’re raising funds from US VCs, ask them early whether an EIN will simplify their due‑diligence. Getting it now saves a lot of back‑and‑forth later.

Tips to Keep Your Tax ID Clean

Once you have a GSTIN or EIN, don’t let it gather dust. Here are three habits that keep you out of trouble:

1. File on time. GST returns are due monthly or quarterly, depending on your turnover. Missing a deadline can lead to penalties and even suspension of the GSTIN.
2. Update details promptly. Change of address, partner, or bank account? Log in to the portal within 30 days and file the amendment. It avoids mismatched records during audits.
3. Separate personal and business finances. Use a dedicated bank account linked to your tax ID. This makes accounting easier and shows regulators that you’re operating a legit entity.

For Indian startups, the tax ID is more than a number – it’s a passport to growth. Whether you’re filing GST returns, applying for a loan, or pitching to investors, having the right tax ID in place builds trust and keeps the government happy.

Got questions about which tax ID fits your venture? Drop a comment or reach out to a local chartered accountant. The faster you secure your tax ID, the quicker you can focus on what matters: building your product and scaling your business.