conposition scheme or normal scheme??

Page no : 2

BHUMI SAVALIYA (CA) (130 Points)
Replied 04 January 2018

if saler is registered n purchaser non registered ..then under reverse charge saler have to pay gst is it true??

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BHUMI SAVALIYA (CA) (130 Points)
Replied 04 January 2018

so what is better composition or normal for retailer??

Satya Lahiri Dandlamudi (CA Final student) (526 Points)
Replied 04 January 2018

"BHUMI SAVALIYA 04 January 2018
if saler is registered n purchaser non registered ..then under reverse charge saler have to pay gst is it true??"

Generally, Seller has to pay GST as he is the one who earns income from the transaction. If the seller is unregistered, the buyer has to pay tax under RCM(Reverse Charge Mechanism) under section 9(4) of CGST Act, 2017.

As per Section 9(3), RCM is applicable for some goods only out of which Silk yarn is one. So, unless your client is purchasing silk yarn he doesn't have to pay tax under RCM.

Hence in my view, the supplier of your client is not correct in saying Reverse Charge will be applicable.

Manas Das (1431 Points)
Replied 04 January 2018

it is just reverse if the seller is unregistered the buyer has to pay under reverse charge . since in your case all your customer are unregistered you should avoid taking registration unless it cross limit

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Manas Das (1431 Points)
Replied 04 January 2018

composition or regular will depend on your customer profile . but generally for retailers in competitive market composition better

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Satya Lahiri Dandlamudi (CA Final student) (526 Points)
Replied 04 January 2018

"since in your case all your customer are unregistered you should avoid taking registration unless it cross limit"

It doesn't matter whether your customers are registered or not. Only thing you must worry about is whether your supplier is registered.

So even your client's supplier must not be worried about your client's registration since he is the customer in this case.

Satya Lahiri Dandlamudi (CA Final student) (526 Points)
Replied 04 January 2018

Composition is preferred, rightly said, Manas. Also the compliances are comparatively less.

Only drawback is that, if your customer is registered non-composition dealer, he cannot claim input tax credit on purchases made from you, since you'll be a composition dealer.