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opting of composition and regular, for fy 18-19

ramesh (C A complete) (67 Points)

14 February 2019

A registered person running hotel and renting of his building for commercial purposs, can he opt both composition for hotel and regular for renting of immovable property, the turnover of hotel is 72,00,000 per annum, and turnover for renting is 27,00,000 ???

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (166394 Points)
Replied 14 February 2019

No.

He has to go with regular scheme.

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ramesh (C A complete) (67 Points)
Replied 14 February 2019

then what is rate to be charge for both the services

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (166394 Points)
Replied 14 February 2019

Hotels face three rate slabs — first one is for Rs 1,000 and Rs 2,500 per day room tariff at 12% with input tax credit;

second is for those having per day room tariff above Rs 2,500 but less than Rs 7,500 at 18% with input tax credit;

third is for five stars and those with room tariffs above Rs 7,700 at 28% with input tax credit.
While renting commercial space attract 18% with input tax credit.

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ramesh (C A complete) (67 Points)
Replied 14 February 2019

thank you, but if hotel mean only supply of food then?

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (166394 Points)
Replied 14 February 2019

GST RATE on Restaurant is 5% [ 2.5 % CGST + 2.5% SGST ] without the benefit of ITC,

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ramesh (C A complete) (67 Points)
Replied 14 February 2019

if I'm wrong pls correct me sir, 5% is composition tax rate or regular tax rate? can he collect the tax from the supplies?

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (166394 Points)
Replied 14 February 2019

Yes, for both its same 5% without ITC....

Read: "The GST Council, in its 23rd meeting in Guwahati, had slashed the tax rate from 18 per cent to just 5 per cent. However, restaurants will not be able to take the benefit of input tax credit (ITC).

The new tax structure for restaurants, which is being implemented from November 1, comes days after the Finance Minister Arun Jaitley expressed his displeasure over eateries not passing on the benefit of input tax credit to restaurant-goers. "All members of the GST Council felt that input tax credit (ITC) to restaurants is not passed on customers. Goods and Service Tax (GST) was being charged on existing rates which put additional tax burden on restaurant goers. Thus, we decided that restaurant industry will not get the benefit of ITC," Finance Minister Arun Jaitley had said.

In the 23rd GST Council meet, tax rate for all AC and non-AC restaurants was fixed at 5 per cent. "Since they did not pass on the ITC benefit to customers, they will not be eligible for the benefit themselves," Jaitley had said. Restaurants inside hotels will also levy 5 per cent GST, except in starred hotels where the tariff is Rs 7,500 or more. The rate for restaurants in starred hotel will remain 18 per cent along with the benefit of input tax credit. Outdoor catering will also be taxed at 18 per cent along with ITC.

Effectively, it will be a universal composition scheme in the restaurant sector, said Finance Minister Arun Jaitley had said during a press meet after the Council meet.

ramesh (C A complete) (67 Points)
Replied 14 February 2019

how it will be a universal composition scheme? in the regular 5% scheme hotelier can levy tax and pay the same without getting ITC where as in the composition 5% scheme hotelier can not collect the tax and have to pay from his pocket?

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