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Job worker composition

Shivani (Learner) (1881 Points)

13 September 2018

Dear Friends

If the treatment or process undertaken by a job worker on goods belonging to principal results in manufacture of goods, then can job worker opt for composition scheme?

regards

shivani

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14 Replies

(Guest)

The composition scheme allows qualifying taxpayers — those whose turnover in the preceding financial year was less than 50 lakhs — to pay a percentage of their yearly turnover in a state as tax. This relieves the taxpayers from collecting tax from their customers directly and provides other benefits as well.

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Rohit Tibrewal (Student & Senior Accountant) (3193 Points)
Replied 13 September 2018

Job work means processing or working on raw materials or semi-finished goods supplied by the principal manufacturer to the job worker. This is to complete a part or whole of the process which results in the manufacture or finishing of an article or any other essential operation.

For example, big shoe manufacturers (principals) send out the half-made shoes (upper part) to smaller manufacturers (job workers) to fit in the soles. The job workers send back the shoes to the principal manufacturer.

As per GST Act, job work means any treatment or process undertaken by a person on goods belonging to another registered person. The person doing the job work is called job worker.

Note: Value of goods sent by the principal will not be included in the aggregate turnover of the registered job worker

Yes, as per Turnover of composition scheme.

Shivam Gupta (19 Points)
Replied 13 September 2018

no,it's also treated as supply of service .further ,it shall immaterial whether the job worker is to be carried out by a job worker with or without any material.

Pankaj Rawat (GST Practitioner) (55047 Points)
Replied 13 September 2018

The composit dealer cannot provide Services as per section 10 CGST Act & the work done by job worker is cover under the services .

Sudarshan Sarda (CHARTERED ACCOUNTANT) (241 Points)
Replied 17 September 2018

YES, YOU CAN OPT FOR COMPOSITION SCHEME IF YOUR TURNOVER IS UPTO 5 LAKHS.

BUT IF YOUR TURNOVER EXCEED 5 LAC THEN YOU CANNOT OPT FOR COMPOSITION SCHEME

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Rohit Tibrewal (Student & Senior Accountant) (3193 Points)
Replied 17 September 2018

@ Sudarshan till now that notification not come under effect 😔

Sudarshan Sarda (CHARTERED ACCOUNTANT) (241 Points)
Replied 17 September 2018

ALREADY CAME. MANY MONTHS AGO. YOU ARE NOT UPDATED

Rohit Tibrewal (Student & Senior Accountant) (3193 Points)
Replied 17 September 2018

OK when, please specify the dates...
@ Pankaj Sir please update

Pankaj Rawat (GST Practitioner) (55047 Points)
Replied 17 September 2018

THE ACT WHICH IS AMMENDED is ON 29/08/2018 (No.31 of 2018)

UNDER S.NO. 5. (III), " provided further that a person who opts to pay tax under section 10 can provide services of value not exceeding 10% of turnover in a state or ut in preceeding fy or 5lack rupees , whicher is higher

And as per s.no.1(2) given in Act :provision of this Act shall come into force on such date as govt may , by notification in the Official Gazette, appoint:

so when the Act is pass on 29.8.2018 , then how can be the notification in this regard can be issue before 29.8.2018

SO TILL DATE THERE IS NO NOTIFICATION IN REGARD & THE COMPOSITION DEALER CANNOT PROVIDE SERVICES FOR SINGLE PENNY AS OF TODAY.

NOTE:

EARLIER IT WAS THE PRESS RELEASED IN WHICH IT WAS PROPOSED THAT COMPOSIT DEALER CAN PROVIDE SERVICES UPTO 5LAC.

PLZ REFER ME THE NOTIFICATION IN THIS REGARD , IF YOU ARE HAVING.

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Rohit Tibrewal (Student & Senior Accountant) (3193 Points)
Replied 17 September 2018

Thank you @ Pankaj Sir

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Sudarshan Sarda (CHARTERED ACCOUNTANT) (241 Points)
Replied 17 September 2018

KISI SANT NE KAHA HAI KAM BOLO PAR SAHI BOLO.

https://roundup.manupatra.in/trans/viewdoc.aspx?i=ptiDy4oUEz7W4RhahAaT6h93RFUeTV40hI1vo81W7g5uCfRP5tL0pktJVchar(43)F5g3qk&id=IMjr1XBLrB3yVo37O8iVkr3ZbDFukoPwBcmZrXZkBaH3lrUpRZAIRkGUN0tOyOpMjHyYw8fGklFR61ZT6qN7mA==

KRIPAYA YE LINK DEKHE OR KHUD KO SANTUSHT KARE KI COMPOSITION DEALER CAN PROVIDE SERVICES UPTO 5 LACS.

YE 25TH MEETING KA DECISION AFTER 23RD MEETING JISME YE SIRF PROPOSED KIYA GAYA THA. AND 25TH MEETING ME APPROVE