GST composition scheme was implemented under the respective State VAT Laws with conditions applied on eligibility for the scheme accordingly. GST composition scheme assures greater compliance without the requirement of maintaining records. This system is missing in Service Tax laws.
Latest Update
13th October 2022
- The ICAI has shared the second edition of the handbook on the composition scheme for Chartered Accountants. Read PDF
09th July 2022
- The important message for some composition taxpayers regarding the negative balance removal is that the process has been completed by the government. read more
09th May 2022
- The Maharashtra Authority of Advance Ruling (AAR) has issued the order for the M/s. KPC Projects Ltd. In the order, Shri T.R.Ramnani and other members said the 18% GST has to be paid for the composite supply of construction hospital works. Read More
GST Software Demo for Composite Taxpayers
32nd Council GST Meeting for Composition Traders
- The annual turnover limit increased by GST council to 1.50 Crores, effectively from 1 April 2019
- Annual filing of GSTR 4 return instead of quarterly. Also, tax is paid to be deposited on a quarterly basis.
- 6 percent GST rate applicable to the Composition scheme for service providers and turnover up to 50 lakh per annum
Note:
- The above amendments shall be applied after the official government notification.
- More: 32nd GST Council Meeting Updates for Composition Traders
Every taxation system has some prescribed rules or regulations which must be followed by individuals, taxpayer or business owners. Maintaining records properly, submission or filing returns timely, simplified generation, and periodic payment of taxes are some of the essential elements of the taxation system for corporate taxpayers. However, business enterprises and owners are facing difficulties to cooperate with such responsibilities of law. It happens just because of a lack of knowledge and the majority of people is not aware of the taxation system.
In 28th GST council meeting, the FM has decided to extend the threshold limit of composition scheme taxpayers from 1 crore to 1.5 crores. Also, included the 10% provision of normal taxpayer annual turnover within the composition scheme if in case the given 10 percent is provided as the service.
Key Features of GST Composition Scheme
Eligibility: – Everyone is not eligible to register under the GST composition scheme. Taxpayers or people whose annual turnover is up to INR 1.5 crore in a financial year. Turnover for special category States, except Jammu & Kashmir and Uttarakhand, the limit is now increased to Rs 75 Lacs. While the turnover threshold for Jammu & Kashmir and Uttarakhand will be Rs 1 crore must register under the GST composition scheme. The small traders should fill up GST CMP-01 form to accept the scheme.
Special Eligibility:- The GST council has included normal taxpayers within the composition scheme in case 10% of annual turnover is provided as a service.
Quarterly Filing Returns: – Instead of submitting returns 3 – 4 times in a month, taxable persons or registered taxpayers will be required to submit or filing tax returns only one time in every quarter under the GST composition scheme.
Intra- State Supplies: – Local suppliers, who supply goods or services within a state can take advantage of the GST composition scheme. Inter-state suppliers will come under the regular GST laws.
Bill of supply, not tax invoice: – Registered taxpayers under the GST composition scheme will be required to show the bill of supply instead of tax invoice to the tax authorities. A person paying taxes under the composition scheme can issue a bill of supply instead of an invoice. Exemptions up to 5 lakhs for services under the composition scheme are also available.
Not Eligible for Input Tax Credit: – According to section 16, goods and services on which composition tax has already been paid (under section 8) do not apply for Input Tax Credit.
Tax Rate: – Manufacturers – 1% ( .5% central and .5% state), Restaurants services – 5% ( 2.5% central and 2.5 state ), Composition levy eligible – 1% ( 0.5% central and 0.5% state )
GST Only on Taxable supplies: – Earlier it was a provision to pay composition GST even on the exempted goods but now after 1st January 2018, the GST will be only payable on the taxable goods.
Penalty: – If the taxable person is not eligible for the GST composition scheme, then the tax authorities can charge a penalty equal to the amount of tax on such person along with his tax liability. Be careful when availing of this scheme and paying taxes. The penalty will be imposed according to the provision of section 73 or 74 if an individual represents incorrect data under the composition scheme.
Voluntary Registrations: – For availing of the benefits of this scheme, taxpayers need to make voluntary registration. If in case, the taxpayer’s annual income turnover exceeds 75 lakh then he will be transferred to the regular scheme. Taxpayers who are already a part of VAT composition need to voluntarily register under this scheme.
Note: The eligibility and service supply exemption is under review after the 23rd GST Council meeting
Highly Recommended: GST Forms: Return Filing, Rule, Registration, Challan, Refund, Invoice
Registration Procedure Under the Composition Scheme
Registered or existing taxpayers not under the Composition Scheme may prefer to opt for it (subject to being qualified), only from the beginning of the next financial year. Tax returns to be filed on as or before 31 March of the previous year.
If in case dealers want to switch to the normal scheme, during the year, they may be allowed to do it. Although, they are not able to switch over to the Composition scheme again within the same Financial Year
Filing Returns Under the GST Composition Scheme
Individuals or registered taxpayers can pay tax under the provisions of Composition Scheme shall provide a return in an official form and official manner within the eighteen days after the end of the relevant quarter.
GST CMP 08 form has been officially declared by the government for depositing payment quarterly under the Composition Scheme.
FAQs on GST Composition Scheme
Q.1 Can a composition dealer purchase goods from an inter-state supplier?
Yes, of course, a person who has opted for composition scheme can procure goods from an inter-state supplier without any restrictions
Q.2 What are the specified composition rates?
Composition rate is uniform for dealers & manufacturers at 1% ( 0.5% Central tax plus 0.5% State tax). Composition rate for Restaurant Services is 5% (2.5% Central tax plus 2.5% SGST) of the turnover. Composition rate for service providers is 3%
Q.3 Is it mandatory for a Composition Dealer to maintain detailed records?
No, it is not mandatory for a registered Composition dealer to maintain detailed records as needed by a normal taxpayer.
Q.4 Is a Composition Dealers allowed to avail Input Tax Credit?
No, Composition dealer is not allowed to avail Input Tax Credit. A taxpayer who opts to pay tax under the composition scheme cannot take credit on his input supplies
Q.5 Is composition dealer responsible to pay both, the Reverse charge and a fixed percentage of normal GST which he is supposed to pay?
If the reverse charge is applicable on a specific supply then the composition dealer is liable to pay GST under reverse charge as a recipient of supply at standard GST rates
Q.6 Can the service provider go for the Composition Scheme?
Yes, Composition scheme for services has been introduced with an initial limit of Rs 50 Lakh, taxable at 6%, beginning from April 1, 2019
Q.7 Can a person avail ITC on the stock after being denied to pay tax under composition from an authorised officer?
Yes a person can still avail ITC by filing a statement in FORM GST ITC-01 (containing details of input stocks along with the inputs contained in semi-finished or finished goods present in stock) on the date on which the option is refused as per order in FORM GST CMP07, within a period of thirty days from the order
Q.8 When does an individual who opted for composition, pay tax?
An individual who opted for composition pays tax on a quarterly basis prior to the 18th* of the subsequent month of the quarter during which the supplies were made (changeable by the government notification)
Q.9 Can a Composition Dealer issue Tax Invoices?
No, a Composition Dealer can not issue a tax invoice because he has to pay the tax out of his own pocket and he is not permitted to recover the same from the customers. He is bind to issue Bill of Supply
Q.10 What are the different types of returns, a Composition Dealer has to file?
A Composition Dealer has to file one return i.e. GSTR-4 on an annual basis, CMP 08 on a quarterly basis.
Q.11 Can a Composition Dealer collect tax from customers?
No, a Composition Dealer has to pay taxes from his own sources and he is not eligible to recover the composition tax from the buyer
Q.12 Can an interstate supplier opt for Composition Scheme?
An interstate supplier can not opt for Composition Scheme as it is available only for dealers imbibed in intra-state supplies
Q.13 How is availed input credit treated when one switch on to Composition Scheme from the normal scheme?
In such a case when a person switches on to composition scheme from normal scheme, he/ she becomes accountable to pay an amount equal to the credit of input tax in terms of inputs present in stock on the day instantly after the date of the switchover. The remaining balance of input tax credit in the credit ledger after payment of such amount will be treated inconsiderable
Q.14 Can I choose for Composition Scheme in one year and flip flop in the later year?
Yes, You are allowed to switch between the Composition Scheme and the normal scheme on the basis of your turnover. The same switchover can be declared on the GST Portal. However, this flip flop comes along with alterations in the way you issue invoices and file your returns
Q.15 Is the alternative to pay tax under composition practicable at any time of the year?
No, the tax under composition cannot be paid at any time of the year. A registered taxpayer is supposed to provide a declaration on the GST Portal in FORM GST CMP-02 prior to the beginning of every financial year
If I am service provider and wants to pay 6% and wants to take new gst Registration then need to take Registration under Rgular scheme or Composition scheme?
I am a composit dealer and I have agriculture business than what is the gst rate for me.
For composition dealer 1% GST, divided as 0.5% CGST and 0.5% SGST
Rental Income from Commercial property / Building exceeds 20 lakhs. Can I register for composite scheme.
Yes
we are into a composition scheme. We are selling electronics Goods, our turn over comes around 40 lakhs only. but we also need to provide repair services to our customers for electronics goods Which means both Goods and Services.
so please kindly anyone reply to us
“Please consult to GST practitioner”
I am a graphic designer and my company is registered under regular GST tax paying. Now I want to migrate to the COMPOSITION scheme. Am I eligible for the composition scheme?
If your P/Y turnover is below 1.5 Crore, then you can migrate to the composition scheme
yes, you can opt but the threshold limit should be well within the limit specified in the CGST Act 2017
We are a service provider with an FY21 turnover of less than 50 lakhs and have filed returns under a composition scheme.
Our turnover might cross 50 lakhs this year, maybe around Feb’22, but we don’t know as of now. Should we continue filing returns under the composition scheme for FY22?
The turnover limit is seen on the basis of previous year turn over, since FY 21 T/O limit is below the prescribed limit you can file composition return for a whole year
i want to know the tax rate for service provider under Composition Scheme
if you are a provider of restaurant service then it will be 5% otherwise it is 6%
Hi,
Are home-baked dog biscuits exempt from GST? if not, can I apply for a composition GST scheme? Under this scheme, if I sell my product to a retailer within the same state I will give them a bill of supply. But, they are registered under the regular GST scheme so will they give a tax invoice to customers or a bill of supply? and for example, if there is 18% GST on the product then do they have to add that to the bill, claim it from the customer and file the GST? or will they apply 1% GST only since my goods are under the composition scheme? thanks for the help.
Yes, you can apply for a composition scheme, and ITC can not be claimed by a taxpayer who purchases from a composition dealer
A hospital having in patients opted for a composition scheme for medicinal sales. Medicinal sales were Rs. 75 lakh and in patients’ room income was Rs. 50 lakh, since room income was exempted under cgst, 1 % gst was [paid for medicine sales only. for 2019-2020. Is it correct
Dear Sir, please consult the same with practicing Chartered Accountant
in FY 2018-19 total sale under composition scheme 1.45 cr. what is limit composition scheme in fy 201819. Have any problem in this sale ?
1.5Crore
Sir, My turnover is less than 1.5 crore, but I am an Inter-state supplier. Can I opt for composition scheme?
Composition Scheme is available only for dealers doing intra-state supplies. If a dealer is involved in inter-State supplies, then they have to opt-out of the scheme
No you can not go under the composition scheme due to inter state supply
Kindly Re-check Answer / Reply of Q. 6. I think its not properly answered.
Query: Presently a taxpayer is registered is under Regular scheme. He is selling goods as well as providing services. He wants to go for a composition scheme.
My understanding is that for the Goods, the maximum Turnover limit is Rs 1.5 crores and pay GST @1%. For services, the Maximum Limit is Rs 50 Laths and pay tax @6%.
so in total Rs 2 crores, he will get his limit ( For Goods Rs 1.5 cr and for services Rs 50 Lakhs)
Kindly confirm the above understanding.
Gross limit is INR 1.5 crore only not 2 crores
hi sir we are in a plan to start Sarees (clothes) retail business with a small volume may be per annum 50 lakhs approx. we will receive amounts from customers on direct selling product and we will receive amounts from customers which we will take orders from vendors on orders from customers and will pay to vendors and we will have a little margin on that. we need suggestions on a turnover on the second scenario how we can take ?? total customer amount or Diff b/w customer receipt and vendor payment?? plz suggest
For turnover calculation, total receipt from customer will be included
Sir, I have a shop of sweets and also selling Milk in the morning I want to know that can I opt composition scheme and do I pay tax on milk supply under this composition scheme or not?
If your Turnover is below 1.5 crores then only you can opt for Composition scheme
Can a supplier of a works contract having an annual turnover of less than Rs. 50 Lakhs in the previous year, avail Composition Scheme made for service providers?
yes
If a Normal GST Registered person makes a supply to a Composition Dealer then which kind of Invoice he can issue?? B2B or B2C
If he issues B2B invoice then would he be able to submit this supply as a b2b supply against the GST No. of Composit Dealer on the GST portal ??
Pls, answer my query.
B2B, Yes
If a composition person purchase goods from other states, what is the rate of tax, whether this tax is taken for input credit or not, pls explain sir
Composition Taxpayer can not claim any ITC on Input Purchase
Can I able to sell my shop which is in composition tax
Sir I want to open a small software development firm in proprietorship mode and also wants to provide services outside the state but as its is in very small level and my turnover will not go above 10 Lakhs. So my query is can I opt for composition scheme for service provides. Please suggest a good solution beacuse I also want to provide bill to my clients. Awaiting for your help. Regards.
“The tax department has given service providers with a turnover of up to Rs 50 lakh time till April 30 to opt for the composition scheme and pay 6 percent GST. … The GST composition scheme was so far available to traders and manufacturers of goods with an annual turnover of up to Rs 1 crore.”
I mean that I cannot opt for a composition scheme?
Yes
SIR, I AM COMPOSITION DEALER GROUNDNUTS PURCHASE FROM FARMERS AND GROUNDNUTS ISSUES DECORTICATING FOR GROUNDNUT SEED. HOW RATE OF TAX AND REVERSE CHARGE
Please contact to GST practitioner
Hello Sir.
I am working as an interior. And my turnover is around 50 lakh. Since I come under composition scheme. I have only purchase invoices for the last quarter. Can you just help me how do I file for intra-state purchase invoice under composition scheme? Please give me a proper explanation. Thanks
Sir, I would like to start a small hardware cum electrical shop (proprietorship ) under NORKA scheme, can I register my trading business under GST Composition scheme??
shall I apply separate PAN for the firm name or its added to my existing PAN?? How much is the max turnover limit per annum?
Your early reply is highly appreciated. if not can you suggest which type of registration is better for me? I plan to run the business by way of arranging materials from the big suppliers with good discount and sell in a reasonable way.
Since you are planning to start a proprietorship concern, therefore, no separate PAN is required. Turnover limit for composition scheme is Rs. 1 crore.
I AM RICE MERCHANT AND RICE IS EXEMPTED NOW HOW TO SHOW MY SALES UNDER THE CMP08 FORM AND DO I HAVE TO PAY TAX.
if you only deal in exempted goods then you cannot opt for composition scheme under GST. if you deal in both taxable and exempted goods then composition rate is applicable for both taxable and exempted supplies.
I am the proprietor of the boutique and cafe under one roof. I am registered under GST. These are not verticals. Both come under the same PAN-based Gst. Can I charge the appropriate rate of GST on the boutique and take ITC while charging 5% for the cafe/restaurant without ITC? The boutique occupies 1500 sq ft area while the cafe occupies 400sq ft area. Thanking you in advance.
Sir, I have a boutique and a cafe under one roof. I am a proprietor of both. Both are under one PAN and one GST Number. They are not verticals. Can I have the boutique under the general category and take input credit while charging 5% in cafe/restaurant without ITC? Thanking you in advance.
Sir I am a shop owner under regular GST scheme and taking material from a composition dealer. How would I pay GST and on what amount if i purchase from a vendor who is under composition scheme? For eg if I purchase a material from composition dealer @ Rs 60 and sell @ 75. I have to pay GST on 15 Rs margin or on entire 75 Rs?
YOU HAVE TO PAY GST ON RS 75 UNDER COMPOSITION SCHEME.
On Rs75/-
DEAR SIR,
I AM PROPRIETOR OF SMALL SCALE REGISTERED COMPANY ENGAGED IN MANUFACTURING OF CUSTOM BUILD ELECTRONIC ITEMS & ALSO DURING UNDERTAKING LABOR WORKS WHERE IN THE MANUFACTURING COMPANY GIVES GOODS TO US FOR TESTING AND INSPECTION AS SPECIFICATION AND AFTER TESTING AND INSPECTION WE ARE RETURNING THE GOODS TO MANUFACTURING COMPANY MY TURN OVER WILL BE AROUND 5 LAKHS ASE INFORM IF I OPT FOR COMPOSITION SCHEME OF GST WHAT ARE THE TAX LIABILITY FOR LABOUR CHARGES & MANUFACTURING THE ITEMS I WILL BE MUCH OBLIGED FOR YOUR ADVICE IN ADVANCE
REGARDS
SRINIVASAN
I want to convert my monthly return to composition ..so when notification will come to do?
Can Work Contractor get GST registration number under Composition Scheme?
No
me ek vehicle ke spars parts sale karta hu aur bike services karta hu.to kya me nayi provision ke hisab se composition me ja shakta hu. mera turnover 20-25 laks jitna he.please help me.
haa , aap composition scheme opt kr skte but jo aap sale kr rhe h parts ki vo within state hona chahiye.
Yes, you are now eligible to opt for composition scheme. Changes will take effect from 01/04/2019.
I’m E-Commerce Sellers can opt for composition scheme in GST.
Sellers supplying goods through E-commerce operator cannot opt for composition scheme.
Sir, I have taxable supplies of Rs.50 Lakhs and also I have Non-taxable supplies of Rs. 20 Lakhs.
1. What will be the Treatment under GST Act, Shall I pay tax on the whole amount or only taxable amount
2. should I opt for composition levy or under Normal Scheme?
as per the reading of section 10(2), the registered person shall be eligible to opt for composition if he is not engaged in making any supply of goods which are not leviable to tax under this act. Please clear the doubt?
You have to pay tax on the taxable amount only.
You should opt for composition as your turnover do not exceeds Rs. 1 crore
IN 2017-2018, I WAS IN REGULAR SCHEME, I SHOWEN SALES DETAILS IN GSTR 1, BUT NOT SHOWED IN GSTR 3B. UNDER AUTO POPULATED OUR PURCHASE IS MORE THAN SALES. AS THE STOCK IS IN BALANCED. THEN I OPT FOR COMPOSITION SCHEME, WHAT TO DO FOR THE SALES SHOWN IN GSTR 1. IF WE HAVE TO PAY, HOW TO PAY UNDER COMPOSITION SCHEME. WHETHER WE HAVE TO PAY OR NOT.
Under the composition scheme, you have to pay on your turnover(sales) at the applicable rate on you from the period you have opted in for composition.
Sir, I am a service provider, providing management consultancy services to my clients. My turnover is about 36-45 Lakhs per annum (under 50 Lakhs). Under the new provisions can I opt for GST composition scheme? If so should I charge 6% GST on all my invoices as some are exempt from GST as they as for overseas clients and considered “export of services”? Kindly advice.
Yes, you can opt-in for composition scheme and can charge 6% GST on all invoices if notification in this regard is published.
Thank you, Sir. Do I have to pay 6% on the “export of services” invoice value also or only on those where service is provided to Indian companies?
There is still not such clarification provided in this regard as only word service has been mentioned there.
I am a technical graduate and provide repair and maintenance of electric motors used in export houses. Can I get registered myself in composition scheme? if yes, what would be GST rate?
Since you are engaged in providing services as of now you cannot opt for composition scheme but as per recent meeting if notification will be issued allowing service providers to opt for composition scheme then you will be eligible.
Hello Sir, I am a manufacturer of ladies garments. I sell my products all over India. what % of tax charges should I pay? MY TURNOVER IS 60 LAKHS
If you opt for composition scheme then you have to pay tax at 1% of turnover and if you opt for regular scheme then you have to pay tax as per rate the item you dealt with.
Since you are supplying all over India, hence you are engaged in interstate supply and hence not eligible for composition scheme. You have to pay GST @5% if apparel is below Rs.1000 however if taxable value is more than 1000 then 12% GST is to be paid. Please consult professionals before acting on any advice.
Yes, agreed.
Sir, I want in the regular scheme in Aug and Sept 2017 after that from Oct 2017 changed to composition scheme. Now kindly Help For Annual Return what I Should file 9 of 9A.
You should file both as of now as there is no clarification yet in this regard.
SIR, I AM A RICE MERCHANT AND I AM IN A COMPO SCHEME. FOR RICE IT IS 0 %. SO I FILED NIL RETURN FROM APRIL TO JUNE AND JULY TO SEPTEMBER. IS IT COMPULSORY TO ENTER THE PURCHASE DETAILS IN INWARD SUPPLIES BOX AS IT has ALREADY ARRIVED IN THE AUTO POPULATED BOX.
No purchase details are not mandatory to be filled in GSTR-4 as per latest Govt. directions.
Sir, I am Composition Scheme dealer my turnover for quarterly is up to 300000 should I have to pay tax for the quarterly as my annual turnover is less than 20 lakhs.
If your turnover is less than Rs. 20 lakhs then you are not required to register under GST and pay tax.
Sir, I am composition dealer and my turnover has been exceeding from 1 Crore and Now as on 11 Jan 2019. I am switching over to the composition to the regular dealer is it right?
Because of i am understanding that the composition limit is 1.50 Crore it is decided as on 23rd GST council meeting
Sir,
I am composition dealer and my turnover has been reached 1.40 Crore. still, we can continue with composition scheme? Or can we convert automatically into the regular GST scheme? and what is the process of change?
You will not be converted automatically, you have to opt out of composition scheme from the menu services provided on GST portal to switch to regular scheme.
Dear Sir
I had already crossed the sales of 1.48 cr under the composition scheme. My first 2 quarter sales are 60 lacks and third quarter sales is 90 lacks. Then what is the actual effect of the tax rate for current return files?
Can we paid 1 % on 90 lacks or pay regular on excess off 1 crore.
Please reply.
Till you are registered as composition dealer you have to pay tax as per composition rates i.e. 1%. As and when you cross Rs. 1 crore then opt-in as the regular dealer and then pay tax as per the regular scheme.
Hello – I am a restaurant owner who is under composition scheme. As part of my sales, I sell MRP items also like Cold Drinks and Ice Creams At MRP. For procuring these, I am paying GST to my supplier (distributor). When filing for my GST, does my turnover include the sale of these MRP articles also or not?
Secondly – At what stage does one need to transfer over to normal GST as one’s revenue approaches the threshold limit?
Yes, these items are also part of your turnover. As and when your turnover exceeds the threshold limit of Rs. 1 crore you need to opt for the normal scheme.
But Sir my turnover reached up to 1.30 crore as on 10 Dec 18, and I am switched over composition to regular as on 11 Jan 18?
It’s fine as file GSTR-4 up to that period and pay tax.
SIR, I AM A RICE MERCHANT AND I AM IN A COMPO SCHEME. FOR RICE IT IS 0 %. SO I FILED NIL RETURN FROM APRIL TO JUNE AND JULY TO SEPTEMBER. DO I HAVE TO SHOW SALES AND PAY TAX?
Yes, you have to show sales but in 0% tax rate where you have to show only sales amount and not tax as rice is exempt.
Hi Sir,
Can you help on this?
I am a regular manufacturer with turnover of less than 75 lakhs per year paying 6% CGST and 6% SGST every month on the goods sold. I am selling my products to the local trader(within the state) who will purchase the product from me and sells to other states. Can I change for composition-scheme for this kind of situation where my buyer is in the local market and buyers sell to other states?
Yes, you can opt for composition since you are making intra-state sale to the local trader. In the case of inter-state sale, composition scheme cannot opt.
Sir,
We opted for composition scheme from Dec 2017. (From July to nov 17 it was Regular with quarterly option). Please clarifies the full.
1. For Oct and nov 17 do we have to file GSTR1 in nov17? For oct 17 there is no option open for GSTR 1 but for nov 17 the option for GSTR 1 is open on the GSTN site(Dec 17 onwards we have switched to composition)
2. We have not filled the ITC- 03 till date . Do we need to file stock details and pay input tax in ITC-03 as it is the middle of the year when we opted for composition?
3. We have around 30000/- lying in ITC credit in GST. Will this amt get lapsed or can we offset this amt in ITC-03(in case we need to pay)
Kindly clarify.
(1) Yes, you have to file quarterly GSTR-1 in Nov 2017 even if you opted for composition
(2) Yes, you have to file ITC-03 even in the middle
(3) You don’t need to pay any amount in ITC-03. such amount will be lapsed
Wrong GST rates mentioned in Article
Which rate is wrong
Hello Sir,
While Creating E Waybill I am trying to find an option 0.5% and 0.5% in e waybill website. Now in the new update, they made it drop down and there is no option of 1%! So what should we select to create a waybill with 1%?
Did the government increase to sales to 1.5crores?
Thanks in advance
Vishnu!
There is no rate of 1% in CGST Act, 2017 for tax payment. Therefore, the same cannot be provided
Hello, we are registered under composite tax form and cannot find a 1% tax rate. Now can you please tell me which website I need to login to create E waybill for composite tax?
E-way bill is to be prepared on the rate of goods applicable, on which they are purchased/sold in the ordinary course of business, not on basis of composite tax rates.
if a regular taxpayer is dealing with a composition dealer does he have to mention it while filling GSTR 1
There is no need to mention it separately. Just file entries like normal taxpayer.
Hi,
I am registered under the Composite scheme. In FY 17-18 I have intra state supplies from Jan’18. Please help how to go about them.
File GSTR-4 quarterly from the date you have taken registration showing intra state supplies and pay tax accordingly.
Hi,
I am Regular based Seller in Mumbai, I sold material to GOA who is actually Registered as Regular but I wrongly selected him as composition and filed both gstr3b and GSTR-1 as the composition for that party instead of regular. Now please advise what difference it will make? how to rectify it.?
In GSTR-1 there is no such option to select dealer as regular or composition, if you have done an entry in B2B section by selecting GST No. then an entry is done only as regular. In GSTR-3B if an entry is done in composition then rectify it in next period return.
Dear Sir,
My client registered under Composition Scheme. now he gets Rental income yearly 2 Lacs from commercial property. As per the notification issued by Govt. 10% of turnover or 5 Lacs whichever is higher is eligible for composition scheme.
My Querry is what rate of Tax applicable in case of Rental Income…??
Such notification is not issued by Govt. yet as it is only decided in the meeting of GST council. As such at present for person availing composition scheme rental income shall be taxable @18%.
Dear Sir,
When will the new composition scheme option will be enabled for firms with turnover up to 1.5 Cr?
As soon as Govt will notify the same and notification in this regard shall be issued.
We are into database services and it is a Pvt Ltd. Company turn over is less than 60 Lakhs currently filing monthly returns would like to know if we can opt for composition scheme. Can we file our returns quarterly?
Composition Scheme is not available for service provider except Restaurant or Caterers. You are into database services you cannot eligible for composition scheme. You have to follow Regular Procedures only.
Yes, rightly said
in q1 2018-19 purchase detail is given or not
As of now, there is no such circular issued in this regard, so you need to give details of purchases in GSTR-4.
Dear Sir,
I am selling food grains item exempted from GST but I am purchasing packing material[empty bags] for packing of food grains please advice me. Should I claim input tax of packing material?
with thanks
No ITC can be claimed on the purchase of materials which are used for exempt supplies.
DEAR SIR,
I AM A ACCOUNTANT.I MENTION PARTY BOOKS ACCOUNT. HE HIS KNOW REGULAR GST. BUT 1 APRIL 18 TO PARTY GO TO LUMSUM SCHEME WHO APPLICATION WHO DAY TO APPLICABLE. SUGGEST ME.
KAUSHIK GAJJAR
I am a retailer of medicines and my turn over is less than 50 lakhs/ year. unknowingly I opted for regular GST and filed the returns for July-17. My consultant who was not much familiar with the new system and computers discontinued his services my returns from Aug till date is pending now. And also I understood that the composite tax is more beneficial for me. Now April onwards I want to migrate to composite tax option. So what is the procedure for doing it? And what kind of services can be done below 5 lakhs limit under composite tax ?please reply
You need to file CMP-02 for opting the composition scheme option, and you have to file the returns as per regular taxpayer until the month of filing CMP-02. All the services are covered under that limit.
Sir, The CGST Act says that supplier of service other than the supplier of food articles is not eligible to register under composition scheme section 10(2). What does this actually mean?
It means only persons providing restaurant services can opt for composition scheme. Other service providers cannot opt for composition scheme. They have to pay tax under the regular scheme.
Q1. Mr A, a manufacturer is having a turnover of Rs. 60 lakhs in the financial year 2016-17. Can He avail the benefit of composite levy scheme under GST in the year 2017-18? How much is the tax required to be paid if the aggregate turnover in 2017-18 supposing Rs.45 lakhs?
Yes, composition scheme can be availed by the person whose aggregate turnover in the preceding or current fiscal year does not exceed Rs. 1 crore. So in 2017-18 composition scheme can be availed. For this in case of traders tax at the rate of .5% of turnover to be paid in 2017-18.
How to Opt for composition for FY 2018-19? At present registered as the regular taxpayer. From 1-4-18 want to convert to the composition. what is the procedure? How to provide stock details? suppose if the assessee does not maintain stock records how to fill form regarding stock?
Thanking You
For converting into composition scheme, you have to file CMP-02 and have to pay the ITC on closing stock.
Hi, If I have to switch composition scheme from regular taxpayer w.e.f 1st April 2018 when should I file form CMP 02 and where should the closing stock be declared and should the tax be paid? Can you please guide on the process/steps involved?
Composition scheme would be applied from the next month of the month in which you have filed CMP-02.
Sir, I am a retailer selling shawls home furnishing etc. our turnover for the year 16-17 was around 40 lakhs. since we buy our stock from different parts of the country and my consultant was not sure if I can opt for composition scheme on 1st July 2017. so we opted for the regular taxpayer and paid taxes as the regular taxpayer from 1st July 2017 to 31st March 2018. I opted for composition scheme on the 131st march, 2018. I had purchased stocks during the year on which I had availed ITC of Rs 23000. I was trying to repay it but when we open the site and fill in the details, it does not accept the form with a message” this is not applicable to you”. how do we pay the ITC back to Govt?
Either your request for conversion under composition scheme will be under process or you can contact to department.
Can assesses allow registration under the same pan with both scheme composition and regular?
Composition scheme is applied on PAN basis and for all the business verticals of assessee. It’s not possible to opt composition scheme for one business vertical and regular for other.
If my expected turnover is between 1 cr to 1.5 cr, can I opt for composition scheme?
As per decisions are taken under GST council meeting, turnover threshold for composition scheme has been raised to 1.5 cr but the notification for application of that provision is not issued by CBEC yet, so till the time, any official notification will be released by dept. t/o threshold will be 1cr.
Sir. A very personal request. Can anyone who is expert in this area like you are, contact CBEC either personally or through email and ask them for clarification on the notification and if not yet done, request them to notify it. Thousands, if not lakhs of businesses are dependent on it. We are not sure where to go and whom to ask about it as no one knows anything about it.
It totally depends on the official part so any personal queries will not be entertained by dept. So you have to wait till the time dept. considers it.
My annual trade turnover is less than 50 lakhs. I also have rental income from commercial property. As the composition scheme dealer can have services allowed up to rs. 5 lakhs, Can I earn income through renting of commercial property?
Same is my case, you got answer for your query, please share with me, any notification if you got
As such, there is no clarification given by CBEC that what services are covered under the specified limit of 5 lacs, so all services deemed to be included and thus allowed.
Hello sir. I just want to know, is the 1.5 Crore turnover limit raised is official now. I heard changes to GST amendments requires parliament approval, is it true. If yes then I have not heard parliament discussing it. Can GST counsel itself raise the limit and amend it. The reason I am saying is that I’m still not seeing any notifications for the limit raised.
Also, the GST profile page does not allow us to click on the opt for the composite scheme – not clickable, but the form to opt the scheme is however accessible from the registration page. Any reason so.
Our retail business turnover is above 1 crore but under 1.5 crore. We are worried whether the 1.5 crore limit officially raised yet.
As official notification is not issued by dept. for raising the exemption limit to 1.5 cr, so for registration purpose t/o limit will be 1cr. till any notification issued by dept.
I am registered as a composition scheme dealer. I am a small business importing small quantities of gate motor from Italy. Can I opt for composition scheme? My turnover is just around 20 30 lakhs.
Please advise.
As you are importing goods, you are not eligible for composition scheme.
Dear Sir/Madam,
I am Tax Consultant. One of my client doing Finance Service Business (Daily Interest, Monthly Interest, Vehicle Finance and so on). now he wants to apply GST. If Finance service taxable under GST then What is the SAC Code and how to calculate Taxable Turnover. Please Suggest me.
SAC code for financial services is 99711.
I am a small trader who sells fruits, vegetables, milk etc which are exempt under GST along with other taxable items. I have registered under Composition Scheme, so how do I calculate the GST liability, as my everyday cash sale includes both Taxable and Non Taxable sales. Kindly guide the same.
Turnover for composition scheme will include both taxable and exempt supplies, so you have to pay tax on total turnover.
Hi,
Can you please let me know the turnover limit for composition scheme and also the official notification?
Turnover limit is 1.5 cr under composition scheme.
Dear sir,
We are doing both Restaurant and Hotel Business with the same Pan number. I want to opt composition scheme for the restaurant business. So what is the procedure for the that as they are under the same pan and how to process the same, please help.
Thanking you in advance
You can apply for another registration from the same PAN for other business, but for calculation of threshold limit for composition scheme, the whole turnover from both the businesses will be clubbed.
Opted reign voluntary under composition but turnover is less than 20 lacs what will be the impact of tax liability
You will be treated as the normal registered person under GST composition scheme. You need to fulfil all compliance related to returns filing and tax payment.
I am a manufacturer and in the composite scheme. What will be tax slab 1% or 2% for the Dec 2017?
A rate is 1% for manufacturer registered under composition scheme.
Dear Sir,
I have a retail firm with annual turnover is less than 20 lacs and I have registered under composition scheme of GST. If I only purchase the goods from other states(Manufacturers/Wholesale suppliers) and supply it to the customers only within the state, still do I need to pay 1% of tax amount on my sales every quarter when filing GST? Please guide me.
As you have registered under composition scheme, you have to pay tax on all outward supplies irrespective of amount of turnover.
Ok. Thank you so much for information.
Sir,
I am a medical practitioner doing clinical service which is exempted service and I own a pharmacy where turnover is less than 1.5 crore. At present, I am under general scheme. Can I opt for composite scheme since I am doing exempted services?
“Aggregate turnover” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number.
Turnover of both exempted, as well as taxable services/goods, has to be taken into account for checking the eligibility for composition scheme.
Hi sir,
I know a company which opted for composition scheme from the beginning of the financial year and they converted to regular from October. but at the beginning of the year, the website didn’t show the GSTR 4 so, the auditor filled the returns on monthly basis itself they field GST-3b till September.Now when they want to do the GSTR-1 for this quarter I mean for the second quarter the website showing composition (GSTR-4)
Now tell me what the auditor should do?whether they file on composition basis or on regular basis?
If opted from Oct, then GSTR-4 has to be filed from October only. For July – Sept, regular returns (GSTR-1,2,3) has to be filed. So from October onwards, GSTR-4 has to be filed.
Can the person who is registered under composition scheme and filling return for the quarter July – Sept convert into the regular dealer?
yes you can apply for withdrawal from composition scheme. Go to amendment section and
Choose the option “Application for Withdrawal from Composition Levy” in Dashboard.
Hi.. If our turnover is more than Rs. 1.5 crore in previous F. Y. i.e. 2016-17 but in current F.Y. 2017-18 our expected turnover will be less than 1.5 crores, in these conditions can we opt for composition scheme after latest amendments in GST.
Both the conditions have to satisfied for claiming the benefit of composition scheme.
kindly let me know applicability of composite scheme in my case. I have a retail business of electronics in a single state and also govt. contractor under the same name and pan and GST.
How can I avail composite scheme
No, you cannot opt for composition scheme since works contract is a service. If your annual turnover is up to Rs. 5 lakhs in respect of the works contract service and aggregate annual turnover is up to Rs. 1.5 cr then you can opt for composition scheme.
From which date the revised rate of 1% for manufacturers under composition scheme will be applicable? Whether from the start i.e. July or from the date of notification?
It will be applicable from July only.
Hi, Earlier I was registered as a regular taxpayer and filed Gstr 3b for July, later on, I applied for composition scheme on 29 Sep. 2017. Now how to file Gstr 4 for the quarter pertaining to July-Sep 2017. Please reply at the earliest.
As per the latest decisions are taken in GST council meet, if you opt for composition scheme, then that will be applicable from the next month. So you need to file GSTR-4 from October onwards.
Hi, In the above case, what should be filed for Qtr – July to September? Because GSTR-4 can be filed only form Qtr – October onwards.
Please clarify your query.
Hi, I tried to apply for Composition scheme and GST website doesn’t allow me. It says the following
“The last date to Opt-In for Composition Levy for 2017-18 was 30th Sep 2017. The window for opting in for composition levy for 2018-19 is planned in March 2018.”
How can I apply it now? I would like to bring my firm under Composition scheme from November 2017. What to do now?
The last date to opt for composition was 30th sept 2017 for the year 2016-17. The composition scheme cannot be opted for at the middle of the year. so you can opt for composition scheme from April 2018 only i.e. next financial year and not from nov 2017.
So what about the latest notifications says increased the limit from 75L to 1Cr? How people will register if it’s not open?
Hi sir. I was wrongly registered as regular and then changed to the composition in the same month July.. I paid the tax for the month of August (auditor said he paid in offline mode). Now it is automatically changed to regular. Am shocked. What to do now??
Contact to the department.
I opted composition, but when I file the GST-4 on GSTN portal not accept and said your option is after the 16th day of August 2017. What can I do? please guide me
Please contact department for assistance.
I have GST under Composition Scheme. I sell the Products to Service Providers(i.e Restaurant). Now my question is what will happen if the buyer has normal GST? They will have to pay the GST for their service as well as the GST for what they bought from me? if so, no GSTN holder will buy anything from Composition Scheme GSTN holder.
Buyer won’t get the input credit coz you are not issuing tax Invoice. Buyer is not liable to pay taxes on your purchases.
Hi,
I am a retailer having a physical shop in Karnataka, importing goods from China and getting some goods manufactured from suppliers in other states. I sell B2C primarily through the local shop as well as some via our own website to other people in India. Sometimes we take orders on the phone and dispatch the goods to customers in other states too after they pay via NEFT.
Can I opt for GST composite scheme?
Thank you.
No interstate seller cannot opt for composition scheme under GST.
Dear Sir, Under Composition Holder in GST Dashboard, Return for qtr July to Sep. till not Open So what can I do?
Utility for the same is still to be provided by the department.
I AM REGISTERED UNDER COMPOSITE SCHEME AND AT THE TIME OF REGISTRATION I HAVE FILLED CROSS THRESHOLD LIMIT BUT ACTUALLY, I HAVE NO TURNOVER LAST MONTH. WHAT I DO?
You can file nil returns if you have no turnover for the period.
Hi, I am small car accessories retailer & sell product on my own website having turnover 25 lac, Most of the orders come from other states & I purchase items from local manufacturers.Since govt implements GST of 28%, we are suffering the most, We had to pay Rs.55000/month GST. Just imagine how difficult for a small business like us will pay such high amount of tax, How can a small business survive in front of big players like Amazon & Flipkart & expand their business in future. Seriously Govt destroying small businesses like us, I request you please raise this issue & suggest whether we opt GST composition scheme or any other solution.
GST composition scheme cannot opt if you have interstate sales.
You can opt Composition Scheme. Its right for you as far as i know.
Sir, I have yesterday option for composition scheme now I have filled my form but I don’t see any change on dashboard but also I filled my GSTR-3B and GSTR-1 on date now I transfer my self for composition scheme but no change on dashboard.
Please Help
I am pharma franchise dealer..Can i apply for composition levy..If i want to sale my goods to composition levy retailer…Can i sale those who are composite dealer…Please reply..Regards
If your turnover do not exceed Rs 75 lacs and you do not sale outside the state then you can apply for composition scheme.
I am in Composite Scheme … can I import materials from other states without waybill … The Invoice shall not cross Rs.50000/- … Please help …
Dear Sir,
i was vat composition taxpayer in existing law, i could not optin composition scheme by mistake so i have created new registration under composition on the same PAN. now i have 2 provisional id regular/composition. i want to cont with composition taxpayer only, should i file regular return as a NIL till the cancellation option not available or i will wait with no action for cancellation option of the same. please tell what i do…
If you have obtained new registration as a composite taxpayer under the GST and have not opted for migration till now then you have to continue with the new registration only since date of opting for migration has already expired. Your old registration will be auto cancelled if not opted for migration.
Dear sir,
I have migrated successfully and its convert as a regular tax payer so I have applied for new registration (in composition) via migration process. now I have 2 provisional id regular/composition.
Q.1 should I submit regular return in NIL for 1 of my migrated regular provisional id till the cancellation option NA.
Q.2 I do not file any return of the same and wait for cancellation option.
Q.3 As I said two firm migrated with same PAN regular/composition, so I want to continue with composition provisional id only so what I do in
that case.
Regards
The window to opt for composition scheme for this financial year was 16th Aug 2017; going forward, one has to opt at the beginning of the year; I wonder if you have been allotted a new separate provisional GSTN in REG 25; you may have only received an ARN. Please confirm status to enable me to answer.
Dear Sir,
One of my migration certificate generate in REG 25 as a regular tax payer and the second one of the same generate in REG 06 as a composition taxpayer (with the same method of migration).
1. my query for the REG 25, that I was exiting composition tax payer could not opt in the composition scheme so I have created another GSTIN number as a composition dealer i.e. 2ZO
2. Should I submit REG 25 Regular Return or i have to wait for cancellation/surrender option.
3. What i do for REG 25 REGULAR or REG 06 COMPOSITION for the same firm/place/pan/business because i am existing composition taxpayer.
please reply
Sir, we registered in vat as regular and now we opt composition scheme in GST , we have utilise all cenvet but some stock approx. Rs. 70000/- are laying with me (@ VAT 5% ). How we return the utilize input on laying stock.
Adarash Stores Bhatni.
Deoria
Uttar Pradesh
Input has to be reversed on the goods lying in the stock.
I think it is not available in the site. Can u please tell me how can i apply?
you can fill the form once it is made available by the department.
i have missed the date (16 Aug 2017) to opt for Composition levy tax.. what can i do to opt for composition scheme ? is there a way to opt? i had thought that during migration from VAT to GST, all the characteristics will be taken in GST scheme.. but i never knew about the opting procedure.. please help me out..
You can apply for a new registration.
NOW, Further re-open opt for composition scheme in GST portal on same system. So, change the same as an early and possible.
My consultant forget to put me into composition and the last for applying composition is over on 16th august so kindly let me know what to do And like me there are so many people those who some problems and didn’t apply the comp. On given so it is to request to kindly extend the date up to 30th August.
i want to register my firm in composition scheme, but due date for filling is over. now what can i do to register my firm in composition scheme.
Sir, i have wrongly migrated GST under composition scheme by filing comp-1. How can i cancel the composition scheme and get regular GST scheme?
you can apply for cancellation of the registration. Online cancellation facility has been provided.
By mistake my consultant didn’t opt for composition scheme at the time of registration. Is it possible for me to opt for composition scheme now? If yes how?
Every registered person under GST and opts to pay taxes under Composition Scheme, must follow
the following:
a) Intimation in FORM GST CMP- 02 for exercise option
b) Statement in FORM GST ITC- 3 for details of ITC relating to inputs lying in stock, inputs contained in semi-finished or finished goods within 60 days of commencement of the relevant financial year
sir, i want to take a new registration and do application around 12.08.2017 under composition scheme then what is the last date of registration. can i do registration under composition scheme.
Registration under GST has reopened on 25th June for a period of three months.For fresh registration under the scheme, intimation in FORM GST REG- 01 must be filed.
sir can i do a new GST application after 16-8-17.
sir i m doing a new registration of GST under composition scheme of propriotery concern then is it mandatory to take DSC for GST registration or can i do registration from aadhar card.
sir, what is provision of penalty levied by mining engineer department and paid by company for overloaded vehicle this is govt.department and has charged a penalty.is there any RCM liabity of GST by company.
sir i m doing a new registration of GST under composition scheme of propriotery concern then is it mandatory to take DSC for GST registration or can i do registration from aadhar card.
at time opting composition scheme showing Financial year 2018-19 it will not effect 2017-18 please clarify
If my turnover is more than 75 lakh in FY 2016-17. Can i opt for composition scheme in FY 2017-18?
No you cannot opt for composition scheme due to turnover.
Sir have made 4 invoices and collected tax @18 % under regular system in month of july. Can I opt for composite scheme from august onwards.
what is the procedure to switch over from composition scheme tp regular scheme under GST.
Hello,
We own a Footwear showroom in Lucknow, and get supplies from outside UP(Registered Dealer) but we sell only in Lucknow, our annual turnover doesn’t come close to 75 lakhs.
So can we opt for GST composite scheme?
If yes, then does it mean we will have to file returns quarterly?
And what would be tax rate applicable to us?
Please reply.
Thanks
Yes, you can opt for composition scheme. You have to file quarterly return. GST rate is 0.5%.
I am a rice dealer, it is non taxable can I opt for composition scheme how should I pay tax
In case of non taxable item, bill of supply is required to be issued. No tax is required to be paid. But if registration is opted for then return filing provisions are applicable.
I ve having a fitness centre(gym)..pl let me know whether I can comes under composite scheme
yes you can opt for composition scheme
Hi
I sell products b2c. But I have stock from before 30 June, which is supplied from other state. Can I ask for composite scheme.
If no what’s the solution for it.
yes you can opt for composition scheme
Sir I am a retailer and I have a previous stock of 10 lakhs which is a local purchase can I opt for composition scheme.
yes you can opt for composition scheme
Is it so that first I have to pay tax on my previous stock then only i can go for composition scheme.
Mai Ek Contractor hun And Maine Tile Ki Manfu. FActory Bhi Lagai Hai
Main Galti Say composition scheme ley le hai . Muhje Pta laga Hai K Contractor composition Scheme Mai Nahi aate. Ish Liye Muhje Compositions Scheme Cancell Karni hai , Kaise Ho gi
i am a registered dealer of gst and i want to registered to composition scheme how do it. help me.
Every registered person under GST and opts to pay taxes under Composition Scheme, must follow the following:
dear sir,
i am going to open a proprietorship business, will sale my goods to other sates too, as i assumed that my business should have a turn over less than 75 lacs this year then should i go for a composition scheme or normal GST registration ? please suggest
If you sale goods to another state than you are not eligible for composition scheme and registration is compulsory irrespective of limit of Rs. 20 lacs.
Sir how to make bill of supply under composition scheme. Is the amount of tax included in actual amount or it is show seperatly?
Bill of supply is issued in case of non taxable supplies or supply of exempted goods/ services. Bill of supply shall include value of supply of goods or services or both taking into account discount or abatement. No tax amount has to be shown separately.
My sale turnover is 3 lacs, I am already registered under GST. Can I opt for Composite scheme
yes you can opt for composition scheme by filing up the relevant form
Could you please let me know which form to fill to switch from GST to Composite scheme?
Every registered person under GST and opts to pay taxes under Composition Scheme, must follow the following:
what is the procedure to get converted to composition scheme from normal scheme?
Every registered person under GST and opts to pay taxes under Composition Scheme, must follow the following:
I am a small trader (proprietorship) and also have some residential rental income (which is exempt from GST). The GSTIN for my trading business has the same PAN number which I use to file my personal income tax return (which includes income from trading business as well as rental income). Am I eligible to register my trading business under GST Composition Scheme?
Yes, you can register under composition scheme.
If the annual turnover is 15 – 16 lakh and if opt for composition scheme then how much tax must I pay on the turnover ???
If annual turnover is less than 20 lakhs the there is no need for registration under GST. If you want to opt for composition scheme, the rate is 2.5% for manufacturers and 1% for others.
Pls clarify 2% or 2.5% for manufacturer
Rate is 2% for manufacture,.
Dear Sir,
Our company sold the product on the basis of C’ Form and it is to be retrieved from the customers from years. How can we approach them or what kind of information we have to give them to retrieve the pending C’forms from the customers.
It’s wrongly mentioned for eligibility that Taxpayers exceeding Rs ,50 lakhs per year must register for composite scheme
It should be “must not register for composite scheme”
We updated it, thanks for your concern.
Can composition dealers take a govt contract? If yes then In which limit
Please contact to GST practitioner