Composition Scheme is voluntary scheme with simpler returns and lesser compliance under GST. A business that needs to mandatorily register under GST because of crossing threshold limit of aggregate turnover can avail benefit of Composition Scheme of GST Act.

  1. If aggregate turnover of business is up to Rs.1.5 Cr for goods and restaurant services (Rs.75 lacs for special category states) or Rs.50 lacs for other services during a financial year, it can opt for Composition Scheme

  2. Issue Bill of Supply for sale of goods and services

  3. Cannot collect GST from its customers on sale of goods or services

  4. Cannot claim an input tax credit of GST paid on purchase of goods or services

  5. Pay tax at a fixed rate on its turnover. The tax rate is either 1%, 2%, 5% or 6% based on nature of the business

  6. File GSTR-4 (Quarterly return) on or before 18th of month from end of a quarter

Read more - What is Composition Scheme under GST?