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TMI BlogComposition LevyX X X X Extracts X X X X X X X X Extracts X X X X ..... the turnover in the State/UT 2 Restaurant Services viz Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (other than alcoholic liquor for human consumption), where such supply or service is for cash, deferred payment or other valuable consideration. 5% ( 2.5% CGST plus 2.5% SGST) of the turnover in the State/UT 3 Any other supplier eligible for composition levy under the composition scheme and the composition rules 1% ( 0.5% CGST plus 0.5% SGST) of the turnover of taxable supplies of goods in the State/UT Thus, in respect of traders, value of exempt supplies shall not be counted for calculating the turnover. The tax shall be levied @1% of the turnover of the taxable supplies of goods Q 19. What is the eligibility category for opting for composition levy? Which are the Special Category States in which the turnover limit for Composition Levy for CGST and SGST purpose shall be ₹ 75 lakh? Ans. Composition scheme is a sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2105 00 00 Ice cream and other edible ice, whether or not containing cocoa 2 2106 90 20 Pan masala 3 24 All goods i.e. Tobacco and manufactured tobacco substitutes Q 21. Whether service providers can apply for composition scheme? Ans. No, the Service Providers, except provider of restaurant services, cannot apply for the scheme. At present, there is no composition scheme for service providers, except for provider of restaurant services. However, a new proviso has been added as per the recent CGST (Amendment) Act, 2018 in order to allow them to be eligible for the scheme even if they supply services of value not exceeding 10% of the turnover in the preceding financial year in a State/Union territory or ₹ 5 lakhs, whichever is higher. Thus, a person who opts to pay tax under composition scheme will be allowed from a date to be notified to supply services (other than those referred to in clause (b) of paragraph 6 of Schedule II), of value not exceeding ten per cent of turnover in a State or Union territory in the prece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vices by way of extending deposits, loans or advances shall not be taken into account. Q 25. Can a person who has opted to pay tax under the composition scheme avail Input Tax Credit on his inward supplies? Ans. No. A taxable person opting to pay tax under the composition scheme is out of the credit chain. He cannot take credit on his input supplies. Q 26. Can a registered person, who purchases goods from a taxable person paying tax under the composition scheme, take credit on purchases made from the composition dealer? Ans. No. Q 27. Can a person paying tax under the composition scheme issue a tax invoice under GST? Ans. No. Q 28. Is monthly return required to be filed by the person opting to pay tax under the composition scheme? Ans. No. Such persons need to file quarterly returns in Form GSTR-4 . The GSTR-4 needs to be filed electronically on the common portal by the 18th day of the month succeeding the quarter relating to the supplies. Q 29. What are the basic information that need to be furnished in GSTR 4 ? Ans. It should contain details of turnover in the State or Union territory, inward supplies of goods or services or both and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o that? Ans. Such a person has to electronically file an intimation in FORM GST CMP-01 , duly signed or verified through electronic verification code, on the common portal, either directly or through a Facilitation Centre notified by the Commissioner, prior to the appointed day , but not later than thirty days after the said day, or such further period as may be extended by the Commissioner in this behalf. Q 35. What if such persons granted provisional registration, gives an intimation to opt for composition levy after the appointed date? Ans. In cases where the intimation in FORM GST CMP-01 is filed after the appointed day, the registered person shall not collect any tax from the appointed day but shall issue bill of supply for supplies made after the said day. Q 36. What are the other compliances which a provisionally registered person opting to pay tax under the composition levy need to make? Ans. Such persons have to furnish the details of stock, including the inward supply of goods received from unregistered persons, held by him on the day preceding the date from which he opts to pay tax under the said section, electronically, in FORM GST CMP-0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made by debiting electronic credit ledger, if there is sufficient balance in the electronic credit ledger, or by debiting electronic cash ledger. If any balance remains in the electronic credit ledger, it would lapse. Such persons also has to furnish the statement in FORM GST ITC-03 which is a declaration for intimation of ITC reversal/payment of tax on inputs held in stock, inputs contained in semi-finished and finished goods held in stock and capital goods under Section 18(4) of GST Act , within a period of sixty days from the commencement of the relevant financial year. Q 41. In case a person has registration in multiple states? Can he opt for payment of tax under composition levy only in one state and not in other state? Ans. No. Any intimation under sub-rule (1) or sub-rule (3) of Rule 3 of the CGST Rules, 2017 in respect of any place of business in any State or Union territory shall be deemed to be an intimation in respect of all other places of business registered on the same Permanent Account Number. Q 42. What is the effective date of composition levy? Ans. There can be three situations: Situation Effective ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isplayed at a prominent place at his principal place of business and at every additional place or places of business. Q 44. What is the validity of composition levy? Ans. The option exercised by a registered person to pay tax under section 10 shall remain valid so long as he satisfies all the conditions mentioned in the said section and under the Composition Rules. Q 45. Can a person paying tax under composition levy, withdraw voluntarily from the scheme? If so, how? Ans. Yes. The registered person who intends to withdraw from the composition scheme shall, before the date of such withdrawal, file an application in FORM GST CMP-04, duly signed or verified through electronic verification code, electronically on the common portal. Every person who has filed an application for, may electronically furnish at the common portal, either directly or through a Facilitation Centre notified by the Commissioner, a statement in FORM GST ITC-01 containing details of the stock of inputs and inputs contained in semifinished or finished goods held in stock by him on the date on which the option is withdrawn, within a period of thirty days from the date from which the option i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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