Opting for Composition Levy Scheme of GST under Section 10 and Process of Related Filing Requirements as per Rule 3
Learn about the Composition Levy process under CGST Rule 3, providing crucial information for businesses opting to pay tax under section 10. This comprehensive guide will walk you through the necessary intimation processes and filing requirements, ensuring a seamless transition into the composition scheme.
In case of persons who have been granted a Provisional registration
Those who are granted provisional registration under clause (b) of sub-rule (1) of rule 24, who choose to pay taxes under composition levy (section 10), must electronically submit an intimation using FORM GST CMP-01. This submission should be duly signed or verified through an electronic verification code on the common portal, either directly or through a Facilitation Centre notified by the Commissioner.
It is imperative to complete this process before the appointed day, with a maximum window of thirty days after this specified day, unless an extension is granted by the Commissioner.
In instances where the intimation in FORM GST CMP-01 is filed post the appointed day, the registered person is barred from collecting any tax from that day onwards. Instead, they are required to issue a bill of supply for transactions conducted after the appointed day, ensuring compliance with the established regulations.
In case of persons Opting with Application for registration under rule.8(1)
When seeking registration under sub-rule (1) of rule 8, individuals have the flexibility to express their preference for tax payment under composition levy by indicating this choice in Part B of FORM GST REG-01. This straightforward process is considered an official intimation to opt for tax payment under the specified section.
In case of Opting the Scheme by the Registered Persons
For any registered person opting to pay taxes under composition levy, a seamless process is in place to ensure compliance. The business must electronically submit an intimation using FORM GST CMP-02, a step that involves a digital signature or verification through an electronic verification code. This can be done on the common portal, either directly or through a Facilitation Centre designated by the Commissioner.
It’s crucial to complete this intimation prior to the commencement of the financial year in which the choice to pay tax under section 10 is exercised. Furthermore, within sixty days from the start of the relevant financial year, the registered entity must furnish a statement in FORM GST ITC-03, following the stipulations outlined in sub-rule (4) of rule 44.
(i) Suppose for the financial year 2020-21, any registered business opting to pay taxes under composition levy. To initiate this process, the entity must electronically submit an intimation using FORM GST CMP-02, ensuring the submission is duly signed or verified through an electronic verification code. This can be conveniently done on the common portal or through a Facilitation Centre as notified by the Commissioner.
It’s crucial to complete this intimation on or before the 30th day of June 2020. Additionally, within the subsequent month, by the 31st day of July 2020, the registered business must furnish a statement in FORM GST ITC-03, aligning with the guidelines outlined in sub-rule (4) of rule 44.
(ii) Irrespective of the provisions outlined in sub-rules (1), (2), and (3), individuals granted provisional registration under rule 24 or those with a certificate of registration as per sub-rule (1) of rule 10 have the option to transition to tax payment under composition levy. To effectuate this choice, they must file an intimation in FORM GST CMP-02 on the common portal, either directly or through a commissioner-notified Facilitation Centre, before the 31st day of March 2018. The transition becomes effective from the first day of the month immediately following the month in which the intimation is filed.
Additionally, these individuals must submit a statement in FORM GST ITC-03 within 180 days from the commencement of tax payment under section 10, adhering to the provisions of sub-rule (4) of rule 44. It’s important to note that once the statement in FORM GST ITC-03 is furnished, the option to submit the declaration in FORM GST TRAN-1 is no longer available
Filing of details of the Stock
Individuals opting to pay tax under composition levy and filing an intimation according to sub-rule (1) are required to provide details of their stock, which includes the inward supply of goods received from unregistered entities. This information must be submitted electronically using FORM GST CMP-03 on the common portal, either directly or through a Facilitation Centre as notified by the Commissioner.
It is essential to complete this submission within a period of ninety days from the date on which the option for composition levy is exercised. However, if needed, the Commissioner may extend this period.
In case of Persons having multiple place of Business
Any intimation made under sub-rule (1), sub-rule (3), or sub-rule (3A) concerning a specific place of business in a State or Union territory is automatically considered as an intimation for all other places of business registered under the same Permanent Account Number (PAN). This streamlined approach simplifies the administrative process, ensuring that a single intimation covers multiple business locations linked to the same PAN.
Conclusion
In conclusion, stay compliant and make the most of the Composition Levy by following these step-by-step procedures outlined in CGST Rule 3. For further assistance, reach out to the designated Facilitation Centre or refer to the official guidelines provided by the Commissioner.
To Know more about the Composition Levy Scheme of GST CLICK HERE
To Access the Update on HSN Code related Changes effective from 1 February 2024 CLICK HERE
READ MORE
Jharkhand HC Quashes Criminal Proceedings Relating to Non-Compliance of GST Summon under Section.70