Today we will discuss the composite scheme in the GST, In this we will discuss all the provision of composite scheme. what are the benefits of the composite scheme. Also we will discuss the transitional provision in GST for composite dealer.
Who is eligible for the composite scheme ?
Any dealer dealing in goods can opt for Composition scheme, note service sector can not opt for composition scheme. Only restaurant can opt for composition scheme.
Threshold limit in composition scheme?
Threshold limit in composition scheme is Rs 75 Laks.
Input credit by composite dealer
Composite dealer cannot take the input credit on the purchase, He has to pay the tax on sale.
Invoice Procedure in Composite scheme
Composite dealer will issue the bill of supply. he cannot issue the GST Invoice
Bill of supply
Composite Rates
| Particular | CGST | SGST |
| Manufacturer | 1 | 1 |
| Restaurant | 2.5 | 2.5 |
| Other dealer | 0.5 | 0.5 |
Can composite dealer purchase the goods from outside state
Yes, Composite dealer can purchase the goods from outside the state
Restriction in composite dealer
Composite dealer can not sale the goods out of state, this is major hurdle for the composite dealer.
No other state purchase should be in Stock, An composite dealer can purchase the goods from out of state but he can not have stock of the goods on the day of transfer from normal to composite.
Goods kept out of composite scheme
Biscuits etc cannot be sale in composite schemes
Transitional provision in composite scheme.
Transfer from Normal to Composite?
Dealer having registered in vat in normal scheme and now want to transfer in composite scheme
Stock available should be duty paid. Input credit already taken in vat and goods held in stock to be reversed
No interstate purchase should be held in stock in trade
Stock from unregistered dealer should not be in stock
Benefits of Composite Scheme
Who can take the Benefits?
Only small retailer selling the goods to the end user will get the benefits of that scheme. where the turnover is small and not saling out of state like
What are the benefits?
Less Compliance
Less tax rate
After checking this blog you can visit our blog do the GST Registration.
