The composition scheme is meant for small businesses whose turnover of taxable goods not more than ₹1.5crores, where GST has to be borne by the seller@1% of such turnover by Traders & @2% by Manufacturers.
The Composition taxpayer cannot issue a tax invoice, because the tax has to be paid by the dealer out of pocket. A Composition Dealer is not allowed to recover the GST from the customers. Service Providers Cannot opt for Composition Scheme.
|Business Categories||CGST||SGST||Tax Rate|
|Traders (G & S )||0.5%||0.5%||1%|
|Supplier of Food or Drinks for human consumption (Without Alcohol )||2.5%||2.5%||5%|
They cannot claim the Input Tax Credit on any purchases. Composition Scheme is available only for dealers doing intra-state supplies (within state). They no need to be maintained the books of accounts for GSTR.
The Composition Scheme is the very helpful to every small business, because they cannot maintained the everyday transactions ( books of accounts ). Compare to regular GST scheme, the Composition taxpayers required file the totally 5 GSTR ( i.e. Four Quarterly GSTR’s in the form of GSTR-4 & mainly one annual GSTR in a year in the form of GSTR-9A.)
A person registered under composition scheme is required to file in total only 5 returns (i.e. 4 quarterly return in form GSTR 4 and one annual return in form GSTR 9A).
Composition dealers are required to file a quarterly GST return using form GSTR-4 by the 18th of the month following the quarter for which the return is being filed.
|Quaterly Period||Due Dates|
|July - September 2017||24th December, 2017|
|October - December 2017||18th January, 2018|
|January - March 2018||18th April, 2018|
|April - June 2018||18th July, 2018|
|July - September 2018||18th October, 2018|
|October - December 2018||18th January, 2019|
In addition, the GST Council reduced the fees for filing GSTR-4 returns after their Due Dates to :
A Taxpayer whose turnover is upto Rs 1.5 crore can opt for Composition Scheme. In case of North-Eastern states and Himachal Pradesh, the limit is now Rs 75 lakh.
No, a Composition Dealer is not allowed to avail input tax credit of GST on purchases.
Before the beginning of every financial year, a registered taxpayer is required to provide a declaration on the GST Portal. This cannot be done anytime during the year.
The Composition taxpayers required file the totally 5 GSTR ( i.e. Four Quarterly GSTR’s in the form of GSTR-4 & mainly one annual GSTR in a year in the form of GSTR-9A.)
The Composition taxpayers required file the GSTR-4 ( Quarterly ) by next month 18th. Also, GSTR-9A has to be filed by 31st December of Next financial year.
A Taxpayer can change GST regular scheme to Composition Scheme once in a financial year.
In this situation, the taxpayer should withdraw from the composition scheme by filing the GSTR-4 within 7 days from the day on which the turnover exceeded. They will be liable to pay tax under the normal tax scheme starting the following day .
The GST Council reduced the fees for filing GSTR-4 returns after their due dates to:
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