GST
Who cannot opt for composition
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Facts
Some persons are barred from composition. These include manufacturers of ice cream, pan masala, tobacco products and certain other notified goods, persons making inter-State outward supplies, casual taxable persons and non-resident taxable persons.
Provisions and law
- Sec 10(2), CGST Act 2017Lists who cannot opt, such as inter-State outward suppliers and notified manufacturers; all registrations on the same PAN must opt together
- Notification 8/2017-CT and its amendmentsNotified goods whose manufacturers cannot opt for composition
Analysis
The bar is based on what you make or how you sell, not just turnover. Example: an ice cream maker with Rs 80 lakh turnover cannot opt, even though he is below Rs 1.5 crore. A trader selling ice cream bought from others is not a manufacturer and can opt. Aerated water manufacturers are also excluded under the notification.
Conclusion
- Check whether you manufacture any notified goods
- Check whether you make any inter-State outward supply
- Check you are not a casual or non-resident taxable person
- If barred, stay in the regular scheme
A Savvy can do this for you
Opting into composition, CMP-02
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