GST Return Filing – Composition Scheme
Eligibility :
Businesses with an aggregate turnover of up to Rs. 1.5 crore (increased to Rs. 1.8 crore for FY 2019-20 onwards) in the previous financial year can opt for the Composition Scheme.
Opting for the Composition Scheme:
Eligible businesses need to opt for the Composition Scheme at the beginning of the financial year by filing Form GST CMP-02.
Quarterly GST Returns:
Businesses under the Composition Scheme need to file quarterly returns instead of the regular monthly returns. The return is filed using Form GST CMP-08.
Due Dates for Quarterly Filing:
The due dates for filing quarterly returns are as follows:
- April to June (Q1): By 31st July
- July to September (Q2): By 31st October
- October to December (Q3): By 31st January
- January to March (Q4): By 30th April
Details in Quarterly Returns (GST CMP-08):
The quarterly return (GST CMP-08) includes details of the outward supplies, inward supplies attracting reverse charge, and tax payable.
Annual Return:
Businesses under the Composition Scheme also need to file an annual return in Form GSTR-4, providing a summary of quarterly returns.
Payment of Tax:
Taxpayers under the Composition Scheme pay a fixed percentage of their turnover as tax. This percentage varies based on the type of business (manufacturers, traders, or restaurants).
Issuing Bill of Supply:
Instead of a tax invoice, businesses under the Composition Scheme issue a Bill of Supply for their supplies.
Restrictions under Composition Scheme:
- Businesses opting for the Composition Scheme cannot avail Input Tax Credit (ITC) on their purchases.
- They cannot make inter-state supplies.
- They cannot supply exempt goods/services.
Voluntary Withdrawal:
Businesses can voluntarily withdraw from the Composition Scheme by filing Form GST CMP-04.
Businesses are advised to refer to the latest notifications and guidelines issued by the GST authorities or consult with a tax professional like Legato Business Solution llp for the most current and accurate information.