GST Composition Registration

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COMPOSITION SCHEME

Meaning

The word composition is derived from Oxford dictionary meaning thereby a “legal agreement to pay a sum in lieu of a larger debt or other obligation”.

Therefore Composition Scheme is a scheme that allow a registered persons whose turnover doesn’t exceeds 1.5 cr. / 75lacs (in case of special category states) per annum to pay a small percentage of fixed amount on the turnover and at the same time, avail relaxation in GST compliances.

In case of person engaged in supply of services he may opt for composition Scheme if his turnover does not exceeds Rs. 50 lacs per annum.

BENEFIT OF COMPOSITION SCHEME

1 Easy compliance as no accounts and records to be maintained.

2 Simple quarterly Return along with quarterly payment of taxes.

Tax Rate under composition Scheme

PARTICULAR CGST SGST/UTGST TOTAL GST
Manufacturer 1% 1% 2%
Restaurant service provider 2.5% 2.5% 5%
Registered Person Engaged in Supplying of services 3% 3% 6%
Registered person engaged in any other supply 0.5% 0.5% 1%

All the Rates are applied on Turnover in a state or Union Territory.

Returns Under Composition scheme

FORM NAME FILLING MEANING
GST CMP-08 QUARTERLY Provides details or summary of self-assessed tax by the composition taxpayer of a quarter. Due Date of Filing CMP08 is 18th of Next month of quarter Ended.
GSTR-04 ANNUALLY In this Taxpayer furnish details regarding summary of outward, Inward supplies including supplies attracting Reverse Charge. Due date is 30th April of relevant financial year.

Process of Registration in Composition scheme

New Taxpayer

Any person who is liable to get register under GST Act and who wants to pay Tax under Composition Scheme may file an application for new registration under GST REG-01.

Conversion from Regular To Composition Scheme

Registered Person who wants to opt Composition scheme needs to file an application in GST Form GST CMP-02 prior to the commencement of Financial Year.

Further he has to file GST ITC-3 within 60 days from the commencement of Financial Year in which he opts for Composition scheme declaring Input held in stock, input contained in semi-finished or finished goods.

Person who are not eligible for composition Scheme

1 Casual Taxable person

2 Non- Resident Taxable Person

3 Person engaged in inter-state supply, supply of non-taxable goods.

4 Person engaged in supply of goods through Electronic Commerce operator

5 Person who is engaged in manufacturing of goods notified in 10(2)(e) of CGST Act i.e.

Ice cream and other edible ice, whether or not containing cocoa

Pan Masala

Tobacco and manufactured tobacco substitutes

Condition & Restriction under Composition Scheme

Person registered Under Composition Scheme cannot issue Taxable Invoice instead he has to Issue Bill of Supply mentioning “composition Taxable Person, not eligible to collect tax on supplies”.

Do not able to claim input tax credit on its Purchases

Have to pay all taxes on purchases including on Reverse Charge Mechanism.

Have to Display “Composition Taxable Person” on every Notice Board or signboard at Prominent Place of Business

Frequently Asked Questions

Ans A person who has opted for composition scheme can have registration in multiple States. But, if he has opted for composition scheme for one registration, then he would have to opt for composition scheme for all other registrations. Further if he has to withdraw from composition scheme from one state for any reason, he would have to withdraw from composition scheme from all the States.Provided Further that aggregate Turnover in same pan GSTIN doesn’t exceeds 1.5 cr

Ans No, you cannot opt for Composition Scheme, if any one of the GSTIN with same PAN is registered as SEZ Unit/SEZ Developer.

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Our Packages

REGISTRATION

  • Documents Verification
  • Application drafting by CA REG-01
  • Reply Show Cause Notice
  • No Objection Certificate or Letter of Authorization drafting
  • Free Advice by CA
  • Call & Email Support
Pay Now: 1999

Discount – 50%

Rs. 999/-

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COMPOSITION RETURN FILING

  • Documents Verification
  • Application drafting by CA REG-01
  • Reply Show Cause Notice
  • No Objection Certificate or Letter of Authorization drafting
  • Free Advice & CMP-08 filing by CA
  • Call & Email Support & 1 Year Quarterly Return filing CMP-08
Pay Now: 12999

Discount – 38%

Rs. 8059/-

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*(Exclusive of Government fees & taxes)

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