{"id":3635,"date":"2018-01-17T10:33:11","date_gmt":"2018-01-17T05:03:11","guid":{"rendered":"http:\/\/carajput.com\/blog\/?p=3635"},"modified":"2021-12-24T15:20:53","modified_gmt":"2021-12-24T09:50:53","slug":"composition-levy-scheme-under-gst","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/","title":{"rendered":"Composition levy Scheme Under GST"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69d2d07105eb7\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69d2d07105eb7\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#Composition_levy_Scheme_Under_GST\" title=\"Composition levy Scheme Under GST\">Composition levy Scheme Under GST<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#Eligible_assessee\" title=\"Eligible assessee\">Eligible assessee<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#Condition_for_obtaining_composition_scheme\" title=\"Condition for obtaining composition scheme\">Condition for obtaining composition scheme<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#Procedure_for_composition_scheme\" title=\"Procedure for composition scheme\">Procedure for composition scheme<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#GST_rate_for_composition_dealer\" title=\"GST rate for composition dealer\">GST rate for composition dealer<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#Disadvantage_of_composition_scheme\" title=\"Disadvantage of composition scheme\">Disadvantage of composition scheme<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#Bill_of_Supply\" title=\"Bill of Supply\">Bill of Supply<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#GSTN_enable_auto-populated_in_the_E-invoice_information_into_GST_Return_-1\" title=\"GSTN enable auto-populated in the E-invoice information into GST Return -1\">GSTN enable auto-populated in the E-invoice information into GST Return -1<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/carajput.com\/blog\/composition-levy-scheme-under-gst\/#Delayed_in_payment_of_GST_then_Intent_to_be_paid_on_net_GST_liability_from_Sep_1_2020\" title=\"Delayed in payment of GST then Intent to be paid on net GST liability from Sep 1, 2020.\">Delayed in payment of GST then Intent to be paid on net GST liability from Sep 1, 2020.<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><\/h1>\n<figure id=\"attachment_2593\" aria-describedby=\"caption-attachment-2593\" style=\"width: 978px\" class=\"wp-caption alignnone\"><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/07\/Featured_Image4.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-2593\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/07\/Featured_Image4.jpg\" alt=\"www.carajput.com; GST\" width=\"978\" height=\"519\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/07\/Featured_Image4.jpg 620w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2016\/07\/Featured_Image4-300x159.jpg 300w\" sizes=\"(max-width: 978px) 100vw, 978px\" \/><\/a><figcaption id=\"caption-attachment-2593\" class=\"wp-caption-text\">www.carajput.com; GST<\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"Composition_levy_Scheme_Under_GST\"><\/span>Composition levy Scheme Under GST<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><a href=\"https:\/\/carajput.com\/gst\/gst-consultancy.php\">GST<\/a> is a very simple, trouble-free compliance for small taxpayers. It is a voluntary and optional scheme. Small taxpayers can get rid of tedious GST formalities and pay GST at a fixed rate of turnover. This scheme can be opted by any taxpayer whose turnover is less than Rs. 1.5 crore.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Eligible_assessee\"><\/span><strong>Eligible assessee<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>A taxpayer whose turnover is below Rs 1 crore can opt for Composition Scheme. In the case of North-Eastern states &#8211; and Himachal Pradesh, the limit is now Rs 75 lakh.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Condition_for_obtaining_composition_scheme\"><\/span><strong>Condition for obtaining composition scheme<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>No Input Tax Credit can be claimed by a dealer opting for a composition scheme<\/p>\n<p>The taxpayer cannot make any inter-state supply of goods.<\/p>\n<p>The dealer cannot supply <a href=\"https:\/\/carajput.com\/gst\/gst-consultancy.php\">GST<\/a> exempted goods<\/p>\n<p>The taxpayer has to pay tax at normal rates for transactions under Reverse Charge Mechanism<\/p>\n<p>If a taxable person has different segments of businesses (such as textile, electronic accessories, groceries, etc.) under the same PAN, they must register all such businesses under the scheme collectively or opt out of the scheme.<\/p>\n<p>The taxpayer has to mention the words \u2018composition taxable person\u2019 on every notice or signboard displayed prominently at their place of business.<\/p>\n<p>The taxpayer has to mention the words \u2018composition taxable person\u2019 on every bill of supply issued by him.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Procedure_for_composition_scheme\"><\/span><strong>Procedure for composition scheme<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The assesse has to file <a href=\"https:\/\/Application of GST on Contribution By RWA Members\">GST<\/a> CMP-02 with the govt. This can be done by logging into GST portal. This intimation should be given at the beginning of every Financial Year by a dealer wanting to opt for Composition Scheme.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"GST_rate_for_composition_dealer\"><\/span><strong>GST rate for composition dealer<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<table>\n<tbody>\n<tr>\n<td width=\"156\"><strong>Types of business<\/strong><\/td>\n<td width=\"156\"><strong>CGST<\/strong><\/td>\n<td width=\"156\"><strong>SGST<\/strong><\/td>\n<td width=\"156\"><strong>TOTAL<\/strong><\/td>\n<\/tr>\n<tr>\n<td width=\"156\">Manufacturer and trader<\/td>\n<td width=\"156\">0.5%<\/td>\n<td width=\"156\">0.5%<\/td>\n<td width=\"156\">1.00%<\/td>\n<\/tr>\n<tr>\n<td width=\"156\">Restaurant not serving alcohol<\/td>\n<td width=\"156\">2.5%<\/td>\n<td width=\"156\">2.5%<\/td>\n<td width=\"156\">5.00%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><strong>Returns to be filed by a composition dealer<\/strong><\/p>\n<p>A dealer is required to file a quarterly return <a href=\"https:\/\/carajput.com\/gst\/gst-return.php\">GSTR-4<\/a> by 18th of the month after the end of the quarter. Also, an annual return GSTR-9A has to be filed by 31st December of next financial year.<\/p>\n<p>Also, note that a dealer registered under composition scheme is not required to maintain detailed records.<\/p>\n<p><strong>Benefits of composition scheme<\/strong><\/p>\n<p>The assesse get the advantage of lesser compliance, limited tax liability.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Disadvantage_of_composition_scheme\"><\/span><strong>Disadvantage of composition scheme<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>No Input Tax Credit available to composition dealers<\/p>\n<p>The taxpayer will not be eligible to supply exempt goods or goods through an e-commerce portal.<\/p>\n<h4><span class=\"ez-toc-section\" id=\"Bill_of_Supply\"><\/span><strong>Bill of Supply<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>A taxable person opting for the scheme has to issue bill of supply as he is not eligible to issue taxable invoice under <a href=\"https:\/\/carajput.com\/gst\/gst-consultancy.php\">GST<\/a>. He has to mention the words \u201ccomposition taxable person, not eligible to collect tax on supplies\u201d at the top of every bill of supply issued by him.<\/p>\n<p>Popular blogs :<\/p>\n<h4><span class=\"ez-toc-section\" id=\"GSTN_enable_auto-populated_in_the_E-invoice_information_into_GST_Return_-1\"><\/span><span style=\"color: #0000ff;\"><strong><a style=\"color: #0000ff;\" href=\"https:\/\/carajput.com\/blog\/gstn-enable-details-to-be-auto-populated-in-e-invoice-into-gstr-1\/\">GSTN enable auto-populated in the E-invoice information into GST Return -1<\/a><\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<h4><span class=\"ez-toc-section\" id=\"Delayed_in_payment_of_GST_then_Intent_to_be_paid_on_net_GST_liability_from_Sep_1_2020\"><\/span><strong><a href=\"https:\/\/carajput.com\/learn\/delayed-in-payment-of-gst-then-intt-to-be-paid-on-net-gst-liability-from-sep-1-2020.html\">Delayed in payment of GST then Intent to be paid on net GST liability from Sep 1, 2020.<\/a><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n","protected":false},"excerpt":{"rendered":"<p>Composition levy Scheme Under GST GST is a very simple, trouble-free compliance for small taxpayers. It is a voluntary and optional scheme. Small taxpayers can get rid of tedious GST formalities and pay GST at a fixed rate of turnover. This scheme can be opted by any taxpayer whose turnover is less than Rs. 1.5 &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[172,4],"tags":[845,846,840,847,1751,839,326,842,468,844,841,843],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/3635"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=3635"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/3635\/revisions"}],"predecessor-version":[{"id":20428,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/3635\/revisions\/20428"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=3635"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=3635"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=3635"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}