Various GST Composition Scheme and Presumptive Schemes from 01.04.2019
We had COMPOSITION scheme for
GOODS manufacturer or trader – at 1% .
For RESTAURANT SERVICE supplier – at 5%.
Now we have , COMPOSITION SCHEME (may be called as Presumptive Scheme) FOR SERVICE PROVIDER OR GOODS + SERVICE PROVIDER – at 6% for First 50 lacs w.e.f. 01-04-2019. Notification No. 2/2019-Central Tax (Rate) To give composition scheme for supplier of services with a tax rate of 6% having annual turn over in preceding year upto Rs 50 lacs. Here is our comparison Analysis for benefit all Small scale assesses.
| Composition for goods manufacturer or trader SECTION 10 | Composition scheme for Restaurants SECTION 10 | Composition scheme (Mainly for service providers) Section 9 | |
| Who can apply? | Exclusive Goods manufacturer or trader including Manufacturer or trader who supply services to extent of 10% of T/O or 5 lacs . whichever is higher | Restaurants not serving alcohol | Notification No. 2/2019-Central Tax (Rate) issued To give composition scheme for supplier of services or provider of Goods+ service both as bundled supply for service provider |
| Who cannot? | Person dealing in 1. Goods on which GST not laviable e.g. petrol, diesel, Gas., Alcohol 2. Person supplying exempted goods only 3. Person supply of service 4. Person engaged in making any supply through an electronic commerce operator 5. Non-resident taxable person or a casual person 6. Producer of ice cream , Pan masala, tobacco , tobacco substitutes 7. Person making interstate outward supply. | Person dealing in 1. Goods on which GST not laviable e.g. petrol, diesel, Gas. Alcohol 2. Person supplying exempted goods only 3. Person supplying service (Other than restaurant Services) 4. Person engaged in making any supply through an electronic commerce operator 5. Non-resident taxable person or a casual person 6. Producer of ice cream, Pan masala, tobacco, tobacco substitutes 7. Person making interstate outward supply. | Person dealing in 1. Goods on which GST not laviable e.g. petrol, diesel, Gas. Alcohol 2. Person supplying exempted goods only 3. Person supply of service 4. Person engaged in making any supply through an electronic commerce operator 5. Nonresident taxable person or a casual person 6. Making supply of ice cream, Pan masala, tobacco, tobacco substitutes 7. Person making interstate outward supply. 8. Who is eligible for composition scheme u/s 10 |
| Turnover limit |
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| Rate | Manufacturer a 1% on total T/O Trader a 1% (only on taxable supply) | 5% | 6% |
| Do’s & Don’ts | 1. He has to pay tax U/S 9(3) – RCM 2. He cannot claim ITC. 3. Apply from 1st march to 31st march i.e before financial year starts 4. File ITC- 3 in 60 days once applied in CMP-02 5. Issue “Bill Of Supply” 6. He cannot sale O/S state 7. Display of invoices of the words ” composition taxable person, not eligible to collect tax on supplies” 8. Display of the words “Composition Taxable Person” on every notice and signboard displayed at a prominent place. | 1. He has to pay tax U/S 9(3) – RCM 2. He cannot claim ITC. 3. Apply from 1st march to 31st march i.e before financial year starts 4. File ITC- 3 in 60 days once applied in CMP-02 5. Issue “Bill Of Supply” 6. He cannot sale O/S state 7. Display of invoices of the words ” composition taxable person, not eligible to collect tax on supplies” 8. Display of the words “Composition Taxable Person” on every notice and signboard displayed at a prominent place | 1. He has to pay tax U/S 9(3) – RCM and 9(4) of CGST Act 2. He cannot claim ITC. 3. Applicable from 01.4.2019 4. Issue “Bill Of Supply” 5. He cannot sale O/S state 6. Display of Bills of Supply of the words ” ‘taxable person paying tax in terms of notification No. 2/2019-Central Tax (Rate) dated 07.03.2019, not eligible to collect tax on supplies’. 7. The registered person opting to pay central tax at the rate of three percent under this notification shall be liable to pay central tax on inward supplies on which he is liable to pay tax under sub-section (3) or, as the case may be, under sub-section (4) of section 9 of said Act at the applicable rates. |
| Returns | GSTR -4 Quaterly | GSTR -4 Quaterly | Yet not prescribed |
| What if T/O limit is crossed in current FY | After crossing 1.5 Cr. T/O limit in current FY, he should convert to normal registration | After crossing 1.5 Cr. T/O limit in current FY, he should convert to normal registration |
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