GST COMPOSITION SCHEME
GST COMPOSITION SCHEME
GST Composition Scheme
Overview of the Composition Scheme
The GST Composition Scheme is an alternative tax levy method designed for small taxpayers with turnovers up to Rs. 100 lakhs (Rs. 75 lakhs for special category states). This scheme is available for businesses in North East states and Himachal Pradesh.
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Key Features of the Composition Scheme
Under the Composition Scheme, taxpayers need to choose to pay tax uniformly across all states and calculate their aggregate turnover on a pan-India basis. The turnover should include all taxable, exempt, and export supplies made by entities with the same PAN.
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Tax Rates and Payment Schedule
Businesses eligible for the Composition Scheme can pay tax at a specific percentage of their turnover every quarter. The rates vary based on the type of business - manufacturers (excluding certain products) at 2%, restaurant services at 5%, and traders or other suppliers at 1%. Tax payments are required on a quarterly basis before the 18th of the following month.
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