Composition Scheme in GST Rates

[Kishan Barai]

what is 1%, 2% & 5% at what stage supplier have to pay in composition Scheme & what entry has to made & where ?? Please explain all 3 above rates on composition Scheme. Thank You

[KASTURI SETHI]

1% is for dealers/retailers, 2% for manufacturers and 5% for those dealers and manufacturers who have more than one business. It is called composite supply. Only Restaurant Service is eligible for composite supply. The person who opts for Composition Scheme will mention the remarks, " Working under Composition Scheme" on the invoices and also display on the signboard as "Composition Scheme". That person cannot charge 1%, 2% 5% (whatever applicable) from the customer. He will file quarterly return. This scheme allows relaxation regarding maintenance of records of accounts. The supplier will pay the amount after three months on the basis of his sale. No ITC is allowed.

[Kishan Barai]

Thank You Very Much Sir

AI Summary

Composition scheme levy alters supplier obligations: no charging tax to customers, quarterly filing, and denial of input tax credit. Composition scheme provides alternative tax liability for eligible suppliers with differentiated rates by business class; participants must not charge the levy to customers, must remark invoices 'Working under Composition Scheme' and display signage, file quarterly returns, pay composition tax based on turnover after the quarter, benefit from relaxed recordkeeping, and are ineligible for input tax credit.