Applicability based on Turnover
Applicable to “Registered Person” whose aggregate turnover in preceding financial year does not exceeds Rs.1.5 Cr. Or Rs. 75 lacs (in special category state expect state of Assam, Himachal Pradesh & Jammu Kashmir) AND Not engaged in Supply of Service Except Restaurant Services
Note :- For state of Assam, Himachal Pradesh & Jammu Kashmir Limit is Rs. 1.5 Cr
ELIGIBILITY CONDITIONS (in current year)
1) Not engaged in supply of goods which are non taxable under GST Act.
2) Not engaged in making any inter state outward supply of goods.
3) Not engaged in supply of goods through an E-commerce operator.
ADDITIONAL CONDITIONS:-
-Taxable person opting composition scheme shall not collect tax on outward supplies
-Taxable person opting composition scheme will not be eligible to claim input tax credit
-Would be applicable for all businesses having registrations under same PAN of the conditions required to opt for composition scheme
RESTRICTIONS AS PER COMPOSITIONS RULES:-
- He is neither a casual taxable person nor a non-resident taxable person
- Goods held in stock as on appointed date are not purchased:-
a. In course of interstate trade or commerce
b. Imported from place outside India
c. From his agent or principal outside state, where the option is exercised under sub-rule 1 of rule 1
d. From unregistered person under RCM basis, provided he can opt the scheme on payment of tax on RCM basis - Not Engaged in manufacturing of ice-cream, pan masala, tobacco & tobacco substitute. However can trade in ice-cream, pan masala, tobacco & tobacco substitute.
Is Composition scheme is mandatory ??
No It is a optional scheme
GST RATE FOR COMPOSTIONS DEALER
| Categories Of Reg. Person | CGST | SGST | Total | Basis Of calculation |
| a. Manufacturer | 0.5% | 0.5% | 1% | Turnover in State |
| b. Catering & Restaurant | 2.5% | 2.5% | 5% | Turnover in State |
| c. Trader | 0.5% | 0.5% | 1% | Turnover in taxable supplies of good and services in state |
Is composition Scheme is also applicable for Service Provider ??
No
Composition scheme is not for service provide but composite taxable person can supply services up to
—-10% of turnover in a state or union territory in the preceding financial year OR
—-5 lakh rupees,
whichever is higher
Is there any time limit for opting composition scheme
Yes
Composition scheme can be opted during registration or in the starting of next Year. Thus if person registered as normal taxpayer then he can not opt for composition but he can opt in next year in the month of April
What if Turnover exceeds in current Year
1) To file an intimation for
withdrawal in prescribed from within 7 days from such events.
2) shall issue a tax invoice for every supply made thereafter
3) shall be allowed to avail input tax credit in respect of stock held by him
as on date.
On every notice or signboard displayed at prominent place of business shall mention words “composition taxable person
Under this scheme composition taxpayer shall mention the word in bill of supply “composition taxable person”
NOTE:- Special category states are: Arunachal Pradesh, Assam, Jammu & Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh & Uttarakhand.