GST registration for Retail Hardware Shop

Save Share

This query is : Resolved

Quick Summary

For a retail hardware shop with a turnover under £1.5 crore and predominantly unregistered customers, the composition scheme can be a simpler option. However, it imposes significant restrictions, including limitations on interstate sales, exports, service provision, and selling via e-commerce platforms. Crucially, you'll forgo input tax credits (ITC) and customers may require tax invoices for their own ITC claims. Carefully weigh these limitations against your business's expansion plans and customer base before deciding.

Vivek

Vivek (Querist)
Follow

08 August 2020 Dear Sir

Shall I go gor composition scheme or regular GST

Regards
Vivek

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
Follow

08 August 2020 You can opt for composition scheme if your turnover is less than 1.50 crore and your buyers are unregistered.

Lekhraj sood

Lekhraj sood (Expert)
Follow

08 August 2020 For a shop with quite low turnover , it is better to opt for composition scheme but please be mindful that it comes with severe restrictions.The major ones are-
Cannot supply interstate – goods and services.

1.Cannot make export of/supply to SEZ, goods or services

2.Goods supplier cannot supply more than 10% services.

3.Cannot sell through e-commerce operator websites (say Amazon) who is collecting TCS.

4.Loose out on ITC of the GST paid on purchases of goods/services

5.Customers may insist on tax invoice with GST to claim ITC.

So it all depends on your expansion plans and customer base and plans.you will see a useful article on this in next couple of days. I am just in the process of finalising it.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now