Procedure to opt for composition levy by a service provider

procedure to opt for composition levy by a service provider
Share This Article
  • 7
  •  
  •  
  •  
  •  
  •  
  •  
  •  
    7
    Shares

Procedure to opt for composition levy by a service provider

From the day GST rolled out, service providers were either overlooked by the GST Department & Government or the beneficial scheme of composition levy was not provided to them unlike the dealers, traders, and manufacturers of goods.  Finally, the decision to bring service providers under the composition scheme was taken in 32nd GST Council Meeting held on 10th January 2019.

Brief about the composition scheme as per notification No. 2/2019-Central Tax (Rate) dated 07.03.2019

  • Eligibility: A registered person providing goods or services or both up to an annual aggregate turnover of Rs. 50 lakhs in the previous year.
  • Tax Rate: 6% (3% CGST+3% SGST)
  • Input Tax Credit: No ITC can be claimed.
  • Outward Supplies: Intrastate sale only allowed not interstate sales.
  • Inward Supplies: Interstate purchases are allowed.
  • Invoice: Only Bill of Supply has to be issued, not a tax invoice.
  • Return: Annually in FORM GSTR-4

 

What is the procedure for a person who wants to register(new) for composition scheme as per CGST(Rate) Notification no. 2/2019 dated 07.03.19?

A person who wants to register afresh for the above composition scheme of GST then one has to

  • File an application for registration in FORM GST REG-01 and make sure that the options
    • At serial no. 5 i.e. Option for composition – Yes is selected/ticked. and
    • At Serial no. 6.1 i.e. Category of registered person  – Option (iii)-“Any other supplier eligible for composition levy” is selected/ticked.

 

 

What is the procedure for a registered person who wants to change from a regular scheme to composition scheme as per CGST(Rate) Notification no. 2/2019 dated 07.03.19?

A person who wants to shift from regular scheme to the above composition scheme of GST then one has to follow the below-mentioned procedure

  • File an intimation for change in registration in  FORM GST CMP-02 and make sure that the option
    • At Serial no. 5 i.e. Category of registered person  – Option (iii)-“Any other supplier eligible for composition levy” is selected/ticked.

Option to opt for the scheme and file an intimation in FORM CMP 02 is now made available on the GSTN portal.

LAST DATE TO APPLY FOR THE CHANGE IS 30th APRIL 2019.

  • File a statement of declaration in FORM GST ITC 03 of ITC reversal/payment of tax on inputs held in stock, inputs held in semi-finished goods, finished goods held in stock and capital goods u/s 18(4).

 

Following notifications, circulars and GST forms are referred to compile the article. You may click on the links below to download.

 

The author of the article is CA Ankita Khetan. If you have any queries concerning the above article. Please write to us either in the comments section below or email us on info.financepost@gmail.com.

Disclaimer: The views expressed in the above article is exclusive to the author. Anyone relying on it is expected to take adequate professional care before using/implementing the content of the article. The website/author will in no case be liable for any damages incurred by relying on the content without adequate consultation.

If you like the articles posted by us, please share them and like our facebook page to stay tuned.

 


You may also like:

  •  
    7
    Shares
  • 7
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  

Be the first to comment

Leave a Reply

Your email address will not be published.


*