compostion scheme to regular in the middle of the year

[Anurag Dhawan]

I am a composition dealer service provider nearing Gross turnover upto 50 lacs which i may achieve in the march month 1st week, i want to know how to file the return for the period Jan to Mar, can i file a normal compostion dealrer return and from next year onwards i will switch over to regular tax scheme, or during this period also i have to pay full tax on turnover over and above 50 lacs kindly advise

[KASTURI SETHI]

 You will have to file both returns in a routine manner. For more details, peruse Section 18(1) (c) of CGST Act.

[Shilpi Jain]

The moment you cross 50L you have to switch over to regular scheme. So invoices issued under regular scheme file as a regular taxpayer

For invoices issued for the period prior to this file composition taxpayer returns for Jan to Mar period.

[Shilpi Jain]

Ensure that when you switch over to regular tax scheme in this FY, you take the eligible credit if any in your stock.

AI Summary

Switch from composition to regular scheme on crossing threshold; file composition for prior supplies and regular returns thereafter. When a composition taxpayer exceeds the eligibility threshold during the year they must migrate to the regular GST scheme from the point of crossing; invoices after migration are to be treated and reported as regular-scheme supplies while invoices prior to migration remain subject to composition returns. Return filing must therefore reflect both statuses for the affected period. On switching, the taxpayer should follow routine procedures and may claim eligible input tax credit for stock on hand at migration.