Professional Documents
Culture Documents
19/07/2017
Presented By
in collaboration with
NeGD (National E Governance Division)
Digital India
&
My Gov Portal
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Composition levy under GST
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Computation of Aggregate Turnover
Aggregate turnover will be computed
on the basis of turnover on an all India basis
and
will include value of all
taxable supplies,
exempt supplies and
exports made by all persons with same
PAN, but
would exclude
inward supplies under reverse charge
central, State/Union Territory and
Integrated taxes and cess.
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Specified rate of composition levy
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Registration/Option
for composition
levy
Effective date of composition levy
Effective date of
Situation
composition levy
Persons who have been granted The appointed date is 22nd June,
provisional registration and who 2017.
opt for composition levy
(Intimation under Rule 3(1)).
Persons opting for composition Effective date of registration;
levy at the time of making Intimation shall be considered
application for new registration only after the grant of
in the same registration registration and his option to
application itself (intimation pay tax under section 10 shall
under Rule 3(2). be effective from the effective
date of registration.
Persons option for composition for The beginning of the financial
composition after obtaining year.
registration (Intimation under
Rule 3(3).
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To opt for composition levy
The person has to
electronically file
a duly signed/verified intimation
in FORM GST CMP-01, on the common portal,
prior to 22nd July, 2017 or such further period as may
be allowed by the Commissioner.
Furnish the details of stock, including the inward
supply of goods received from unregistered persons,
held by him on the day preceding the date from which
he opts to pay tax under the composition scheme,
electronically, in FORM GST CMP-03, on the common
portal, either directly or through a Facilitation
Centre notified by the Commissioner, within a period
of sixty days from the date on which the option for
composition levy is exercised or within such further
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Option to pay tax under composition levy before
the FY
The option is required to be given electronically in
FORM GST CMP-02, prior to the commencement of the
relevant financial year.
In case a person has registration in more than one
State/ UT, then the option to pay tax under
composition scheme will have to be exercised for all
States.
Any intimation in respect of any place of business in
any State or Union Territory shall be deemed to be an
intimation in respect of all other places of business
registered on the same Permanent Account Number.
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ITC reversal for opting for composition levy
The registered person opting to pay tax under composition scheme
is required to pay an amount equal to the input tax credit in respect of inputs
held in stock and inputs contained in semi-finished or finished goods held in
stock on the day immediately preceding the date of exercise of option.
The ITC on inputs shall be calculated proportionately on the basis of
corresponding invoices on which credit had been availed by the registered
taxable person on such inputs.
In respect of capital goods held in stock on the day immediately preceding the
date of exercise of option, the input tax credit involved in the remaining
useful life in months shall be computed on pro-rata basis, taking the useful
life as 5 years. The ITC amount shall be determined separately for integrated
tax and state tax/Union territory tax.
The payment can be made by debiting electronic credit ledger, if there is
sufficient balance in the said ledger, or by debiting electronic credit ledger,
if there is sufficient balance in the said ledger, or by debiting electronic
cash ledger.
The balance, if any in the electronic credit ledger would lapse.
Such persons also have to furnish the statement in FORM GST ITC-03 which is a
declaration for intimation of ITC reversal/payment of tax on inputs held in
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stock, inputs contained in semi-finished and finished goods held in stock and
Intimation of details of stock on date of opting for
composition levy GST-CMP-03
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GST CMP 03 2/2
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Form GST ITC-03 Declaration for intimation of ITC
reversal /Payment of Tax on stock, Section 18 (4)/
Rule 44 (4)
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GST ITC-03 2/2
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Composition levy- Procedure
Opting for composition scheme
Category of persons How to exercise Effective date of
option composition levy
Persons migrated from Intimation in form From beginning in GST
central excise and VAT CMP-01 & declare
stock in CMP03
New registration under Intimation in the From the effective
GST registration form date of registration
In other cases Intimation in Form Beginning of the
CMP-02 financial year
Return filing
Quarterly- by the 18th of the month after the quarter
Opting out of composition scheme- Anytime at option
File an application if Form CMP-04
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Penal Provisions
Where any contravention is observed by the proper officer wherein the
registered person was not eligible to pay tax under the composition
scheme or has contravened the provisions of the CGST Act, 2017 or
provisions of Chapter II of the CGST Rules, 2017, he may issue a notice
to such person in FORM GST CMP-05 to show cause within fifteen days of
the receipt of such notice as to why the option to pay tax under the
composition scheme shall not be denied.
Upon receipt of the reply to the said show cause notice in FORM GST
CMP-06, the proper officer shall issue an order in FORM GST CMP-07
within a period of thirty days of the receipt of such reply, either
accepting the reply, or denying the option to pay tax under the
composition scheme from the date of the option or from the date of the
event concerning such contravention, as the case may be.
ITC can be availed by filling, a statement in FORM GST ITC-
01(containing details of the stock of inputs and inputs contained in
semi-finished of finished or finished goods held in stock) by him on
him on the date on which the option is denied as per order in FORM GST
CMP-07, with in a period of thirty days from the order.
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Penal Consequences
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Intimation to pay tax under section 10 (composition
levy)
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Intimation to pay tax under section 10 (composition
levy)
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Opting for Composition Scheme at the time of
filling Application for registration
While Registering as a normal Tax Payer, a person need to access
the URL www.gst.gov.in and furnish the information in Part A of
the application. On successful submission he can use the TRN
received while filling Part B of the registration application GST
REG-01 (at serial no. 6)
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Opting for Composition Scheme at the time of filling
Application for registration
In case of Yes
a. Select the checkbox for accepting the declaration for opting for Composition
scheme.
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Procedure for opting for composition scheme in GST
portal 1/12
To opt for the composition scheme on the GST Portal, perform the following
steps:
1. Access the https://www.gst.gov.in/ URL. The GST Home page is displayed.
Before submission, you must also check the box for Verification
(below the Composition Declaration) that states that all the
information given is true and that nothing has been concealed
from the authority.
Finally, before submission, select the Authorized Signatory from the dropdown
menu and enter the Place.
The system will perform some validations and if they are successful
your ARN for the work item will be generated and sent to you via
email and SMS within the next 15 minutes.
1. FORM GST CMP-1 Intimation for composition levy by a person; who has been granted provisional registration and who
(Migration) opts to pay tax under section 10 i.e. Composition Levy (prior to appointed day but not later than 30
days from the appointed day)
2. FORM GST CMP-02 Intimation for composition levy by a registered person who opts to pay tax under section 10 i.e.
(Opt for composition Composition Levy
scheme) (prior to the commencement of the financial year for which option to pay tax under this scheme
exercise)
3. FORM GST CMP-03 Details of stock including the inward supply of goods received from unregistered persons to be
(Migration) provided by a person who has been granted provisional registration adopts pay tax under composition
levy (Migration)
4. FORM GST CMP-04 Application for withdrawal from the composition scheme when ceases to satisfy any of the condition
of the composition scheme.
Application for withdrawal from the composition scheme who intends to withdraw from the
composition scheme
5. FORM GST CMP-05 Show Cause Notice for denying the option to pay tax under Composition levy by the officer (Reason to
believe that not eligible to pay tax u/s 10 or contravened the provision of the Act or these rules)
7. FORM GST CMP-07 Order for accepting or denying the option to pay tax under Composition levy upon receipt of reply to
SCN
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Quarterly returns for registration person opting for
composition levy
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GSTR 4 2/4
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GSTR 4 3/4
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GSTR 4 4/4
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Auto-draft details for registered person opting for
composition levy
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GSTR 4A 2/2
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Opting out of
composition levy
Opting out of Composition levy
Rule 6 of CGST Rules
The option to pay tax under composition scheme lapses from
the day on which aggregate turnover during the financial
year exceeds the specified limit (Rs. 75 lakhs/Rs. 50
lakhs)
Taxpayer is required to file an intimation for withdrawal
from the scheme in FORM GST CMP-04 within seven days from
the day on which the threshold limit has been crossed.
Taxpayer can avail the input tax credit in respect of the
stock of inputs and inputs contained in semi-finished or
finished goods held in stock by him and on capital goods
held by him on the date of withdrawal
Taxpayer to furnish a statement within 30 days of
withdrawal containing the details of such stock held in
FORM GST ITC-01 on the common portal. 49
Voluntarily withdrawal from composition levy
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Intimation/Application for Withdrawal from Composition
Levy
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Declaration for claim of input tax credit under sub-section
(I) of section 18
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ITC 01 2/6
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ITC 01 3/6
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ITC 01 4/6
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ITC 01 5/6
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ITC 01 6/6
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Disqualification
procedure for composition
levy
Penal Provisions
Where any contravention is observed by the proper officer wherein the
registered person was not eligible to pay tax under the composition
scheme or has contravened the provisions of the CGST Act, 2017 or
provisions of Chapter II of the CGST Rules, 2017, he may issue a notice
to such person in FORM GST CMP-05 to show cause within fifteen days of
the receipt of such notice as to why the option to pay tax under the
composition scheme shall not be denied.
Upon receipt of the reply to the said show cause notice in FORM GST
CMP-06, the proper officer shall issue an order in FORM GST CMP-07
within a period of thirty days of the receipt of such reply, either
accepting the reply, or denying the option to pay tax under the
composition scheme from the date of the option or from the date of the
event concerning such contravention, as the case may be.
ITC can be availed by filling, a statement in FORM GST ITC-
01(containing details of the stock of inputs and inputs contained in
semi-finished of finished or finished goods held in stock) by him on
him on the date on which the option is denied as per order in FORM GST
CMP-07, with in a period of thirty days from the order.
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Notice for denial of option to pay tax under section 10 -
From GST CMP-05
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Reply to the notice to show cause-Form GST CMP-06
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Order for acceptance / rejection of reply to show cause
notice Form GST CMP-07
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Penal Consequences
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Quick Video available on GST Website(www.gst.gov.in)
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