Welcome Changes in Composition Scheme from Next FY i.e. 1st Apr 2019

GST Council is carefully listening Voice of Industry. Government is following harmonious approach and endeavouring to find all possible solutions to points raised by Industry, for effective, efficient and successful implementation of GST.

In case planning to take Composition Scheme, below mentioned latest changes be beneficial to arrive at correct decision.

Increase in Turnover Limit:

W.E.F 01.04.2019, The limit of Annual Turnover in the preceding Financial Year for availing Composition Scheme for Goods shall be increased to Rs 1.5 crore. Special category States would decide, within one week, about the Composition Limit in their respective States.

Compliance Simplification:

The compliance under Composition Scheme shall be simplified. They would need to file one Annual Return but Payment of Taxes would remain Quarterly along with a simple declaration.

Composition Scheme for Services

A Composition Scheme shall be made available for Suppliers of Services (or Mixed Suppliers) with a Tax Rate of 6% (3% CGST +3% SGST) having an Annual Turnover in the preceding Financial Year up to Rs 50 lakhs. The said Scheme Shall be applicable to both Service Providers as well as Suppliers of Goods and Services, who are not eligible for the presently available Composition Scheme for Goods. They would be liable to file one Annual Return with Quarterly Payment of Taxes along with a Simple Declaration.

Effective date for withdrawal from composition scheme:

As per Circular No.77/51/2018‐GST ,Where the taxpayer has sought withdrawal from the composition  scheme, the effective date shall be the date indicated by him in his intimation or application filed in FORM GST‐CMP‐04 but such date may not be prior to the commencement of the financial year in which such intimation or application for withdrawal is being filed. In case of denial of option by the tax authorities, the effective date of such denial shall be from a date, including any retrospective date as may be determined by tax authorities, but shall not be prior to the date of contravention of the provisions of the CGST Act or the CGST Rules

Online reply to show cause notice:

If  Proceedings for compulsory withdrawal from Composition Scheme is initiated by a Tax Official, against a composition taxpayer, then composition taxpayer can now reply to such SCN issued on GST Portal.

Contributed by CS Payal Kataria

Disclaimer: The contents of this document are solely for informational purpose. It does not constitute professional advice or recommendation of firm. Neither the authors nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this document nor for any actions taken in reliance thereon.

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