- October 27, 2020
- Posted by: OptimizeIAS Team
- Category: DPN Topics
Context: Over 3.5 lakh composition taxpayers under GST will now have the facility of filing NIL return by just sending a SMS.
- Taxpayers under the composition scheme of the GST will now have more relaxed rules with an increased turnover limit for the applicability, inclusion of service providers and reduced tax rates.
- This scheme is also applicable to the real estate sector with respect to under-construction, ready and affordable homes.
- The composition scheme is an alternative method of tax levy under GST designed to simplify compliance and reduce compliance costs for small taxpayers.
- The main feature of this scheme is that the business or person who has opted to pay tax under this scheme can pay tax at a flat %age of turnovers every quarter, instead of paying tax at a normal rate every month.
- The composition scheme is applicable to manufacturers or traders whose taxable business turnover is up to ₹1.5 crore (₹75 lakh in case of North-Eastern States).
- A service provider can opt for the scheme if his taxable turnover is up to ₹50 lakh.
- Businesses with inter-State supplies, manufacturers of ice cream, pan masala and tobacco, and e-commerce players cannot opt for the composition scheme.
- The composition scheme effectively acknowledges the importance of the MSME sector, by granting relief to it on GST filings, procedures and tax rates.