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GST UNDER COMPOSITION LIABILITY

Sanjiv R Chitransh (3 Points)

08 April 2020

I give sales and service for IT products, I am registered under composition rule.

Suppose I raise bill of supply for Rs20000. in which Rs16000 is for traded products and 4000 as service charge.

What will be the tax liability to be paid by me?

1% for traded products and 6% for service charges or What?

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4 Replies

inderjeet saini (227 Points)
Replied 08 April 2020

I have few questions to u

1. what is your main business.
2. what type of service your provide which is directly linke to point 1

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CA Naveen Chand (Chartered Accountant) (12729 Points)
Replied 08 April 2020

if you sells product and provide services along with

so you are allowed to make supply of service of 10% of turnover in state of the preceding FY or Rs. 5,00,000 whichever is higher .

then in such a case rate is 1 % of taxable turnover in state (not turnover in state)

Otherwise you can avail benefit of NN 2/2019

then rate is 6%

Pankaj Rawat (GST Practitioner) (55052 Points)
Replied 08 April 2020

As your query sounds to be that You are registered as Composition dealer in GST.
Now let me make you clear , that there is 2type of composit dealer.
1. In term of Section 10(1) , the composit dealer under this section can provide supply of Services value not exceeding 10% of turnover in the preceding FY or 5lac whichever is higher & liable to charge 1% GST (trader)

2. In term sub Section (2A) of Section 10 , (Availing benefit of Notification 2/2019 CT(R) , the composit dealer under this scheme can supply services or goods or both , is required to charge 6% (3+3) GST.

So As to above you can either charge 1% GST (Both goods+services) or 6% GST (Both goods+services) as per registration being obtained in above said scheme.

Note : Cannot avail both the scheme. so check under which scheme you have been registered & charge GST accordingly.

mvramana (Student) (285 Points)
Replied 09 April 2020

Please note that it is done away by the recent Budget 2020 which means that a composition dealer shall not make any supply of goods or services u/s.10(2)

Note: Effective date yet to be notified