composition scheme
amit dadheech (chartered accountant) (7 Points)
02 July 2017amit dadheech (chartered accountant) (7 Points)
02 July 2017
obeid
(learner)
(292 Points)
Replied 02 July 2017
A registered person whose aggregate turnover in the preceding financial year did not exceed seventy five lakh rupees may opt to pay, in lieu tax at the normal rates, tax at such rate as prescribed under composition levy
I. The Turnover Limit for the Composition Levy: [As per discussions in the 17th GST Council Meeting held on 18th June, 2017]
1. The GST Council, in its meeting held on 11th June, 2017, had recommended increase in the turnover limit for Composition Levy for CGST and SGST purposes from Rs.50 lakh to Rs.75 lakh for all eligible registered persons. However, no clear view was taken as to whether or not this increased turnover limit will apply in case of Special Category States.
2. In its meeting held on 18th June, 2017, the GST Council has recommended that the turnover limit for Composition Levy for CGST and SGST purposes shall be Rs.50 lakh in respect of the following Special Category States namely:
3. The Council has also recommended that in case of Uttarakhand, the turnover limit for Composition Levy for CGST and SGST purposes will be Rs.75 lakh.
4. For the State of Jammu & Kashmir the turnover limit for the Composition levy will be decided in due course.
(2) Following persons will not be eligible to opt the composition scheme even conditions as mentioned in serial number 1 are fulfilled by them
Where more than one registered persons are having same permanent account number (PAN), the registered person shall not be eligible to opt for Composition Levy unless all such registered persons opt to pay tax under the said composition levy.
Notwithstanding anything contained in serial number 2(a) above, a registered person engaged in any supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration, may opt for composition Levy.
S.No | Nature of activity of supplier | Rate of Tax |
1 | Manufacturer | 1% |
2 | registered person engaged in any supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration | 2.5% |
3 | Other Suppliers | 0.5% |
The registered person who opts for composition levy shall not collect any tax from the recipient on supplies made by him nor shall be entitled to any credit of input tax.
The registered person who has opted for composition levy, shall lapse to continue under the scheme with effect from the day on which aggregate turnover during a financial year exceeds the limit of fifty lakh rupees.
If the proper officer has reasons to believe that a taxable person has paid tax under composition scheme despite not being eligible, such person shall, in addition to any tax that may be payable by him under any other provisions of this Act, be liable to a penalty
(i) Intimation by migrated persons registered under existing law
Any person registered under the existing law who has been granted registration on a provisional basis and who opts to pay tax under the scheme, shall electronically file an intimation in FORM GST CMP-01, duly signed, on the Common Portal, either directly or through a Facilitation Centre notified by the Commissioner, prior to the appointed day, but not later than thirty days after the said day, or such further period as may be extended by the Commissioner in this behalf.
Provided that where the intimation in FORM GST CMP-01 is filed after the appointed day, the registered person shall not collect any tax from the appointed day but shall issue bill of supply for supplies made after the said day.
(ii) Intimation at the time of making application for registration
Any person who applies for registration under GST may give an option to pay tax under composition levy in Part B of FORM GST REG-01, which shall be considered as an intimation to pay tax under the said section.
(iii) Intimation by registered person
Any registered person who opts to pay tax under composition levy shall electronically file an intimation in FORM GST CMP-02, duly signed, on the Common Portal, either directly or through a Facilitation Centre notified by the Commissioner prior to the commencement of the financial year for which the option to pay tax under the aforesaid section is exercised and shall furnish the statement in FORM GST ITC-3 accordingly within sixty days from the commencement of the relevant financial year.
A migrated registered person in point (i) above who files an intimation to pay tax under composition levy shall furnish the details of stock, including the inward supply of goods received from unregistered persons, held by him on the day preceding the date from which he opts to pay tax under the said section, electronically, in FORM GST CMP-03, on the Common Portal, either directly or through a Facilitation Centre notified by the Commissioner, within sixty days of the date from which the option for composition levy is exercised or within such further period as may be extended by the Commissioner in this behalf
Any intimation in points (i) or (iii) above in respect of any place of business in any State or Union territory shall be deemed to be an intimation in respect of all other places of business registered on the same PAN.
The person exercising the option to pay tax under composition levy shall comply with the following conditions:
Thanks https://gst.caknowledge.in
Live Course on Invoice Management System (IMS) - 2nd Batch(With Recording)