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GST Composition Scheme — Eligibility & Tax

CGST Act 2017: s.10 · Rule 7, CGST Rules · Turnover limits: ₹1.5 crore goods (₹75 lakh special category states) / ₹50 lakh services u/s 10(2A)

Aggregate turnover — preceding FY (₹)

Turnover for tax computation — current period (₹)

Category

Composition Levy — Eligibility & Tax

u/s 10, CGST Act 2017 · quarterly payment via CMP-08, annual GSTR-4

Traders pay 1% on taxable turnover only; manufacturers on total turnover in the State. Composition dealers cannot collect tax, issue tax invoices, claim ITC, or make inter-state outward supplies. Bill of supply must state "composition taxable person".

About This Tool

The GST Composition Scheme Calculator helps small businesses check eligibility for the Composition Scheme under Section 10 of the CGST Act and compute the quarterly composition levy. The scheme allows eligible taxpayers to pay a fixed percentage of turnover as GST instead of regular monthly compliances, significantly reducing the compliance burden. The turnover limit is ₹1.5 crore for goods (₹75 lakh for special category states) and ₹50 lakh for services under Section 10(2A).

How to Use

Enter your Aggregate Turnover (PAN-level) for the preceding financial year.

Enter the turnover for the current period (quarter) for tax computation.

Select your category: Manufacturer/Trader (1%), Restaurant (5%), or Service provider u/s 10(2A) (6%).

Click Check Eligibility — the tool shows eligibility status, composition tax, and filing reminders.

Frequently Asked Questions

Who can opt for the Composition Scheme?

Businesses with aggregate turnover up to ₹1.5 crore (₹75 lakh in special category states) for goods, and ₹50 lakh for services under s.10(2A). Excludes businesses making inter-state supplies, non-taxable goods, or those registered under e-commerce operators collecting TCS.

Can a composition dealer issue a tax invoice?

No. A composition dealer must issue a 'Bill of Supply' (not a tax invoice) and cannot collect GST from customers. The bill must state 'composition taxable person, not eligible to collect tax on supplies'.

Can a composition dealer claim ITC?

No. ITC cannot be claimed by composition dealers. This is a key trade-off — lower compliance but no input credit.

When must composition tax be paid?

Quarterly, through Form CMP-08, by the 18th of the month following the end of each quarter. Annual return GSTR-4 must be filed by 30th June.