The GST regime is ON now and we are sure that there are a few nagging doubts about how the regime is going to pan out. These doubts are more due to mis-information floating around. We would like to clear a few doubts which may be there in your mind through this document.
Goods and Services Tax is set to bring along a new regime of business compliance in India. Large organizations have the requisite resources and expertise to address these requirements. On the flip side, many startups and Small and Medium Enterprises (SMEs) may struggle to comply with these provisions. To resolve such scenarios, the government has introduced Composition Scheme under GST. When opting for the Composition Scheme under GST, a taxpayer will be required to file summarized returns on a quarterly basis, instead of three monthly returns (as applicable for normal businesses).
Businesses dealing only in goods can only opt for composition scheme. Services providers have been kept outside the scope of this scheme. This holds true if your annual turnover is below Rs.75 Lakhs. If your daily business revenue is more than Rs.20, 500/- per day you cannot opt for the composition scheme. However your business has to be registered under the GST composition regime and a GST number obtained from the authorities.
No. Since a Composition Dealer is not allowed to avail input tax credit, such a dealer cannot issue a tax invoice as well. A buyer from composition dealer will not be able to claim input tax on such goods.
No, a Composition Dealer is not allowed to collect composition tax from the buyer.
The information we have provided is true to the best of our knowledge. This information is mainly to help clarify doubts. We are not responsible for any fall out of the use of this information in your business activities or decisions.