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Composition scheme for coaching centre

31 March 2019

Whether A coaching centre getting tuition fees can opt for composition scheme for 2019-20...what will be the tax rate..Total turnover is around 18-20 lacs...Currently some students do not pay GST we have to pay from our pocket...Whether For new year I can opt for composition and fill form Comp 2...please guide me...thanks

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16 Replies

RAJA P M ("Do the Right Thing...!!!") (127483 Points)
Replied 31 March 2019

Composition scheme not available for Pure Service...

Prem Kewalramani (292 Points)
Replied 31 March 2019

Thanks sir

Pankaj Siddhu (other) (299 Points)
Replied 31 March 2019

I think, from 01.4.2019, only service provider or both goods & service provider upto 50 lakhs limit can opt for composition scheme by charging 6% GST.

5 Like

shailendra shukla (Bhopal) (1741 Points)
Replied 31 March 2019

yes you can opt for composition scheme from 1st april 2019.......

RUPINI KOTHAMASU (CA-JOB) (502 Points)
Replied 31 March 2019

yes you can opt

Prem Kewalramani (292 Points)
Replied 31 March 2019

Raja sir...there seems difference of opinion..Most consultants sayI can opt for composition from 1 April 2019...if T O is less than 50 lacs...Sir Please guide me and remove the confusion...,Thanks

RAJA P M ("Do the Right Thing...!!!") (127483 Points)
Replied 31 March 2019

Dear Friends...

Please confirm with details about the Composition Scheme to Pure Service Provider....

It's mean Can I opt Composition Scheme...
Bcoz, I'm one of the service provider (Tax Consultancy)...

Prem Kewalramani (292 Points)
Replied 31 March 2019

Has any one else has applied for Composition for coaching classes...pure service provider...Turnover less than 50 lacs...

RAJA P M ("Do the Right Thing...!!!") (127483 Points)
Replied 31 March 2019

Eligibility For GST Composition Scheme

Getting registered under composition scheme is optional and voluntary. Any business which has a turnover of less than Rs. One crore or 75 lakhs for the specified states can opt for this scheme but on any given day, if turnover crosses the above-mentioned limit, then he becomes ineligible and has to take registration under the regular scheme. There are certain conditions that need to be fulfilled before opting for composition levy.

They are as follows:

Any assessee who only deals in supply of goods can opt for this scheme that means this provision is not applicable for service providers. However, restaurant service providers are excluded.

There should not be any interstate supply of goods that means businesses having only intra-state supply of goods are eligible.

Any dealer who is supplying goods through electronic commerce operator will be barred from being registered under composition scheme. For example: If M/s ABC sells its products through Flipkart or Amazon (Electronic Commerce Operator), then M/s. ABC cannot opt for composition scheme.

Composition scheme is levied for all business verticals with the same PAN. A taxable person will not have the option to select composition scheme for one, opt to pay taxes for other. For example, A taxable person has the following Business verticals separately registered – Sale of footwear, the sale of mobiles, Franchisee of McDonald’s. Here the composition scheme will be available to all 3 business verticals.

Dealers are not allowed to collect composition tax from the recipient of supplies, and neither are they allowed to take Input Tax Credit.

If the person is not eligible under composition scheme, tax liability shall be TAX + Interest and penalty which shall be equal to the amount of tax.

Persons who cannot opt for the composition scheme

Supplier of service other than restaurant owners(Serving foods and non-alcoholic drinks)

Supplier of non-taxable goods

If the person in engage in the inter-state supply of goods

Supplier supplying goods through E-commerce operator, who is eligible to collect TCS

Supplier of tobacco, pan masala, and ice cream

Bill of supply

As the composition scheme dealer cannot pass on the credit of the tax, he is required to issue the bill of supply. Details to be mentioned in the bill of supply are as follows –

Name, address, and GSTIN of the supplier

A consecutive serial number which is a unique number for every financial year

Date of issue

If the recipient is registered then the name, address, and GSTIN of the recipient

HSN Code of goods or Accounting Code for services

Descripttion of goods/services

Value of the goods/services after adjusting any discount or abatement

Signature or digital signature of the supplier or his authorized representative

https://www.profitbooks.net/gst-composition-scheme/

Pankaj Rawat (GST Practitioner) (55037 Points)
Replied 31 March 2019

As per the Notification 2/2019 CT ( R) :

whose aggregate turnover in the preceding
financial year was fifty lakh rupees can opt for composition Scheme .

Hence who is only providing Services can opt for composition Scheme & all the restrictions is same but the rate of Tax Is 6%

Note cannot collect tax from customer & cannot claim input in his inward supply

RAJA P M ("Do the Right Thing...!!!") (127483 Points)
Replied 31 March 2019

No... Composition scheme not applicable for pure service provider...

As per Composition Scheme rule who is deal said activity (Trading, Manufacturing) and with Service (Trading, Manufacturing) then only can opt composition scheme...

It's not applicable to Pure service provider...

Said notification (2/2019) also note previous terms related acts...

shailendra shukla (Bhopal) (1741 Points)
Replied 31 March 2019

Raja ji... which kind of service providers do you think can opt the new composition scheme of 50 lakhs limit???...........

RAJA P M ("Do the Right Thing...!!!") (127483 Points)
Replied 31 March 2019

The Person who deals (Trading, Manufacturing) and he can give service under composition scheme...

Ex :
**If a person deal Computer related sales then He can give same related service under composition scheme...

**If a Person deal Electrical & Electronics related sales then he can same related service...

Composition scheme not applicable to Who give Pure Service provider...

(Also the same in above said link.)

Pankaj Rawat (GST Practitioner) (55037 Points)
Replied 31 March 2019

It not basically Composition Scheme , the govt has given option TO taxpayer who is supplying Intrastate supply of SERVICES OR GOODS Or Mixed SUPPLY .

below is extract from said Notification:

G.S.R......(E).- In exercise of the powers conferred by sub-section (1) of section 9, subsection (1) of section 11, sub-section (1) of section 16 of the Central Goods and Services Tax
Act, 2017 (12 of 2017) (herein after referred to as the “said Act”), the Central Government, on
the recommendations of the Council, and on being satisfied that it is necessary in the public
interest so to do, hereby notifies that the central tax, on the intra-State supply of goods or
services or both as specified in column (1) of the Table below, shall be levied at the rate
specified in the corresponding entry in column (2), subject to the conditions as specified in the
corresponding entry in column (3) of the said table below, namely:-

1.Supplies are made by a registered person, -
(i) whose aggregate turnover in the preceding
financial year was fifty lakh rupees or below;
(ii) who is not eligible to pay tax under sub-section
(1) of section 10 of the said Act;
(iii) who is not engaged in making any supply
which is not leviable to tax under the said Act;
(iv) who is not engaged in making any inter-State
outward supply;
(v) who is neither a casual taxable person nor a
non-resident taxable person;
(vi) who is not engaged in making any supply
through an electronic commerce operator who is
required to collect tax at source under section 52; and
(vii) who is not engaged in making supplies of the
goods, the descripttion of which is specified in column
(3) of the Annexure below and falling under the tariff
item, sub-heading, heading or Chapter, as the case may
be, as specified in the corresponding entry in column
(2) of the said annexure.
2.Where more than one registered persons are having
the same Permanent Account Number, issued under the
Income Tax Act, 1961(43 of 1961), central tax on
supplies by all such registered persons is paid at the
rate specified in column (2) under this notification.
3. The registered person shall not collect any tax from
the recipient on supplies made by him nor shall he be
entitled to any credit of input tax.
4. The registered person shall issue, instead of tax
invoice, a bill of supply as referred to in clause (c) of
sub-section (3) of section 31 of the said Act with
particulars as prescribed in rule 49 of Central Goods
and Services Tax Rules.
5. The registered person shall mention the following
words at the top of the bill of supply, namely: -
‘taxable person paying tax in terms ofnotification No.
2/2019-Central Tax (Rate) dated 07.03.2019, not
eligible to collect tax on supplies’.
6. The registered person opting to pay central tax at the
rate of three percent under this notification shall be
liable to pay central tax at the rate of three percent on
all outward supplies specified in column (1)
notwithstanding any other notification issued under
sub-section (1) of section 9 or under section 11 of said
Act.
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.

If you fullfill above conditions can opt for said scheme