Composition scheme - restaurant in tamil nadu

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Justin Frank

1 Points Posted on 21 February 2019

We are running a restaurant in a mall (food court). It is having common dining with other restaurant in the food court.

Currently we are charging 5% as GST from customers in billing. Someone suggesting that, we can enter into 1% GST payment scheme for restaurants business below 1.5 crore turnover (we are under 1 crore turnover). Under our this PAN we do only one restaurant business.

Is it possible to convert my billing to "no GST" (not collecting GST from customers) and can I pay 1% from the sales value as GST.

Is there any way to do this ?

Please recommend.

Regards Jack.

Replies (5)

Kunal Pansari

Accountant

1037 Points Posted on 22 February 2019

Even in Composition scheme, tax rate for restaurants is 5%.

Risvan P K

Auditor

48 Points Posted on 22 February 2019

Hi Justin,

If your taxable turnover from your restaurant remains within the limit of Rs.1.5 crore, then it is better to opt for composition scheme and pay tax at 5% of the turnover. I say this on the basis of decisions taken in the 32nd GST council. That is, from 1st April 2019 onwards, taxpayers opted for composition scheme is not required to file returns quarterly. They only need to pay tax quarterly and file the return (GSTR-4) at the end of the year (i.e, once in a year), which will make the compliance procedure much easier for a small business. By this, we will be able to reduce our effort and expenses on compliance matters.
But at the same time, it is to be noted that, if you have opted for composition scheme you will not eligible to claim input tax credit on your purchases and you can't collect tax from your customers.