composition registration
suresh (Accounts executive) (108 Points)
20 October 2018
should pay tax while registration for composition dealers?
8 Replies
CA Rakesh Joshi
(Chartered Accountant )
(1272 Points)
Replied 20 October 2018
For manufacturer and traders of goods - 1%
For restaurants not serving alchohol - 5%
For restaurants not serving alchohol - 5%
rahul
(a)
(1620 Points)
Replied 20 October 2018
For opting for composition scheme the turnover limit has been increased from 1 Crore to 1.5 Crore but yet to be notified.
I'll try to explain in simple words :
The logic behind the Composition levy is to reduce the headache of calculating setoff of tax liability for small tax payers i.e. working the GST collected, GST paid then offset the liability and paying the balance to Govt is now not required. Just need to work on Outward supply and pay minimal tax. ( but RCM is applicable to composition tax payers )
Composition shceme made it simple i.e Do not collect any tax from your customers and you can pay tax at a lessser rate to the Govt.
Following businesses can opt for compostion scheme -
a ) Manufacturer and trader - 1% ( CGST and SGST )
b ) Restaurants not serving alchohol - 5% ( CGST and SGST )
* Service provider cannot opt for Composition scheme.
Since tax is one of the major source of revenue for the Government if composition scheme allowed for every registered dealer then the revenue to the Govt will be at stake and hence the scheme is made available for only specific businesses.
I'll try to explain in simple words :
The logic behind the Composition levy is to reduce the headache of calculating setoff of tax liability for small tax payers i.e. working the GST collected, GST paid then offset the liability and paying the balance to Govt is now not required. Just need to work on Outward supply and pay minimal tax. ( but RCM is applicable to composition tax payers )
Composition shceme made it simple i.e Do not collect any tax from your customers and you can pay tax at a lessser rate to the Govt.
Following businesses can opt for compostion scheme -
a ) Manufacturer and trader - 1% ( CGST and SGST )
b ) Restaurants not serving alchohol - 5% ( CGST and SGST )
* Service provider cannot opt for Composition scheme.
Since tax is one of the major source of revenue for the Government if composition scheme allowed for every registered dealer then the revenue to the Govt will be at stake and hence the scheme is made available for only specific businesses.
Vinod Babu
(24196 Points)
Replied 20 October 2018
In composition levy-
* For trader and manufacturer, it is 1%(cgst 0.5%+sgst 0.5%.
* For Restaurant, it is 5%(cgst 2.5%+sgst 2.5%)
Gst to be paid on total taxable supplies.
From 1st jan18,no gst on exempted supplies.
* For trader and manufacturer, it is 1%(cgst 0.5%+sgst 0.5%.
* For Restaurant, it is 5%(cgst 2.5%+sgst 2.5%)
Gst to be paid on total taxable supplies.
From 1st jan18,no gst on exempted supplies.
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