FAQ- To Opt Composition Scheme( Explained under GST)

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1. How to opt for the Composition Scheme in GST?

You can opt for the Composition Levy under GST if you are a regular taxpayer with an aggregate annual domestic PAN-based turnover as specified from time to time.

However, you cannot opt for the Composition Levy if you are/you make:

- any supply of goods which are not liable to be taxed under this Act

- inter-state outward supplies of goods

- supplies through electronic commerce operators who are required to collect tax under section 52.

- a manufacturer of notified goods

- a casual dealer

- a Non-Resident Foreign Taxpayer

- a person registered as Input Service Distributor (ISD)

- a person registered as TDS Deductor/Tax Collector


Composition Scheme Under GST- Limit, Eligibility, Rates and Benefits


2.How do I apply for Composition Scheme if I am already registered as a regular taxpayer?

To opt for the Composition Levy, perform the following steps on the GST portal:

  1. Log in to the Taxpayers’ Interface
  2. Go to Services > Registration > Application to Opt for Composition Levy
  3. Fill the form as per the form specification rules and submit.

3. How do I convert from regular to composition scheme in GST?

Any taxpayer who is registered as normal tax payer under GST needs to file an application to opt for Composition Levy in Form GST-CMP-02 at GST Portal prior to the commencement of financial year for which the option to pay tax under the aforesaid section is exercised.


4. When can I opt for the Composition Levy?

In order to avail this scheme, you need to file an online application to Opt for Composition Levy with the tax authorities. Taxpayers who can opt for this scheme can be categorized as below:

  

  1. New Taxpayers: Any person who becomes liable to register under GST Act, after the appointed day, needs to file his option to pay composition amount in the Application for New Registration in Form GST REG-01.

 

  1. Existing Taxpayers: Any taxpayer who is registered as normal tax payer under GST needs to file an application to opt for Composition Levy in Form GST-CMP-02 at GST Portal prior to the commencement of financial year for which the option to pay tax under the aforesaid section is exercised.


5. What are the returns to be filed by a Composition taxpayer?

Composition taxpayer needs to pay tax and furnish a statement, every quarter or part thereof, as the case may be, in FORM GST CMP-08.

And further he has to furnish a return for every financial year or part thereof, as the case may be, in FORM GSTR-4.


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