The recent circular issued by the Central Board of Indirect Taxes and Customs (CBIC) clarifies the suppliers who want to opt for composition scheme can opt till 31st July, 2019 (Extended by three months) and eligible to pay tax at the rate of specified rate i.e.6% commencing from 1st April, 2019 under Goods and service tax .
Earlier the date was marked on 30th April, 2019 as the deadline for service providers to opt for the scheme with turnover upto Rs. 50 lakh.
As per the circular, the suppliers satisfying the conditions for opting the composition scheme are required to file Form GST CMP – 02, have to select “any other supplier eligible for composition levy” and liable to pay tax @6% instead of other rates specified as per Goods and Service tax act and rules.
Note : The suppliers opting for composition scheme are not eligible for claiming any Input Tax Credit from the consumers.
Earlier, the GST composition scheme was so far available to traders and manufacturers of goods (excluding which are not eligible) with an annual turnover of up to Rs 1 crore. Now, this threshold limit has also been increased to Rs 1.5 crore from April 1.
About 17.5 lakh suppliers have been opted for the composition scheme out of 1.22 crore businesses registered under GST.
Extract of the circular can be read as “a registered person who wants to opt for payment of central tax @ 3% by availing the benefit of the said notification, may do so by filing intimation in the manner specified in sub-rule 3 of rule 3 of the said rules in FORM GST CMP-02 by selecting the category of registered person as “Any other supplier eligible for composition levy” as listed at Sl. No. 5(iii) of the said form, latest by 31st July, 2019. Such person shall also furnish a statement in FORM GST ITC-03 in accordance with the provisions of sub-rule (3) of rule 3 of the said rules”.