Query on composition dealer

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 August 2018 I am a composition dealer from july 2017 onwards. and simultaneously i am earning rent income from commercial premises. and i have not charged gst on rent income. i have discharged gst liability on sale of goods @ 1 %.

So i just wanted to know whether i am eligible to opt for composition scheme.

if yes then how should i discharge my gst liabilty on rent income.

M.M Sachora

M.M Sachora (Expert)
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21 August 2018 kindly read this For rent
According to the GST Act, renting out of an immovable property would be treated as a supply of services. GST, however, will be applicable only to certain types of rent such as:

When a property is given out on lease, rent, easement, or licensed to occupy
When any property is leased out (or let out) including a commercial, industrial, or residential property for business (either partly or wholly)
These type of renting is considered as a supply of services and thus would attract tax.
When you rent out a residential property for residential purpose, it is exempt from GST.

The following conditions must be satisfied in order to opt for composition scheme:

No Input Tax Credit can be claimed by a dealer opting for composition scheme
The taxpayer cannot make any inter-state supply of goods.
The dealer cannot supply GST exempted goods
Taxpayer has to pay tax at normal rates for transactions under Reverse Charge Mechanism
If a taxable person has different segments of businesses (such as textile, electronic accessories, groceries, etc.) under the same PAN, they must register all such businesses under the scheme collectively or opt out of the scheme.
The taxpayer has to mention the words ‘composition taxable person’ on every notice or signboard displayed prominently at their place of business.
The taxpayer has to mention the words ‘composition taxable person’ on every bill of supply issued by him.
Those supplying goods can provide services of upto Rs. 5 lakh,

On my opinion if your total rent does not exceeds Rs.5 lakh per year then you can go through Composition...

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