Service providers with a turnover of up to Rs. 50 lakhs have been given the deadline of April 30 to opt for the composition scheme and pay a reduced GST tax of 6%. The option to pay a lowered rate of 6% would come into force from the start of the new fiscal year or from the date the service provider obtains a new registration.
Under the composition scheme, the service provider can charge a lower GST rate of 6% from their customers as against the higher slab of 12% and 18% for most of the services.
For the supplier, the CBIC in a circular said that the scheme can be opted for by filing form CMP-02 latest by April 30, 2019. And other businesses who tend to obtain new register can benefit under the scheme at the time of registration by filing form GST REG-01.
Until now the GST composition scheme had been available to manufacturers and traders of goods with an annual turnover of up to Rs. 1 crore. This threshold too has increased to Rs 1.5 crore from April 1.
Under the scheme, traders and manufacturers are required to pay only 1 per cent GST on goods which otherwise attract a higher levy of either 5, 12 or 18 per cent. Such entities also cannot charge GST from the purchaser as well.