Composition scheme window open for six more months

Composition scheme window open for six more months

Bid to bring more small taxpayers into easier compliance plan

The Goods and Services Tax (GST) Council has decided to keep open the composition scheme, an easier compliance and tax option, till March 31. The second window of the scheme closed on September 30. It allows small taxpayers to pay a fixed rate of turnover as tax and eases GST formalities.“The opportunity to opt for composition scheme will be available till March 31, 2018,” Revenue Secretary Hasmukh Adhia told Business Standard.

The move will give entities more time to evaluate their business models to comply with the scheme requirements, enabling more assessees to avail of it.A notification moving the deadline to March is expected by early this week.The Council, chaired by Finance Minister Arun Jaitley, had on Friday raised the eligibility threshold of annual turnover to Rs 1 crore from Rs 75 lakh for the composition scheme.

The scheme offers a flat rate of tax and allows quarterly filing of tax returns, instead of monthly filing. Under the scheme, traders pay the GST at 1 per cent, manufacturers at 2 per cent and restaurant owners at 5 per cent, but they are not allowed input tax credit. Small taxpayers up to Rs 1.5-lakh crore annual turnover have also been extended the option of paying taxes and filing returns every quarter.

Under the composition scheme, a dealer has to furnish one return, the GSTR-4, on a quarterly basis and an annual return, the GSTR-9A, as against three forms every month by a normal taxpayer. Besides, there is no requirement of invoice-wise details in their returns. Around 94-95 per cent of tax revenue comes from big taxpayers.

So far, 1.5 million registered entities have opted for the composition scheme — a sixth of the 8.9 million GST assesses.“Given the feedback about SMEs (small and medium enterprises) struggling with GST compliances, the government wants to give an opportunity to a large number of small businesses. The fact that the window is open till March 2018 clearly demonstrates this,” said Pratik Jain of PwC India.

Rising awareness and solving registration-related challenges have led to a pick-up in the popularity of the scheme. About 540,000 taxpayers opted for it under the new window of about 14 days till September 30, compared to one million as of August 16, the earlier deadline.

A dealer opting for this scheme cannot issue a tax invoice. Hence, someone buying from such a dealer cannot claim input tax on the goods bought. Besides, one cannot do inter-state supplies in order to opt for the scheme.The scheme is not available for manufacturers of tobacco and tobacco substitutes, pan masala and ice cream

GSTN reminds 1.7 mn assessees to file return

Only over half of the eligible taxpayers have filed GSTR-1 or detailed sales returns two days ahead of the filing deadline of October 10. This has prompted the GST Network to send reminders to close to 1.7 million assessees, who have filed the summarised returns but not the detailed returns.Of the 6.5 million registrations in July, only 55 per cent or the 3.6 million taxpayers have filed GSTR-1 returns so far. The filing deadline was extended by a month to October 10 at the Council meeting in Hyderabad.About 82.6 per cent taxpayers have filed GSTR-3B for July and 63 per cent for August. Of the 7.3 million eligible taxpayers, 4.6 million have filed summarised returns for August.

States get Rs 8,600 cr in compensation

The Centre has released close to Rs 8,600 crore to states as compensation for losses incurred in the first two months of the GST roll-out. Compensation has been given to all states except a couple, including Rajasthan. The cess distributed is about more than half of the Rs 15,021 crore collected as compensation cess during July and August, Rs 7,198 crore and Rs 7,823 crore, respectively. States have been promised full compensation for the losses they make in the first five years of GST roll-out, from the cess pool.

The Business Standard, New Delhi, 09th October 2017

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Don't forget to verify your income tax return in August: Here's the process

An ITR return needs to be verified within 120 days of filing of tax return. Now that you have filed your income tax return, remember to verify it because your return filing process is not complete unless you do so. The CBDT has reduced the time limit of ITR verification to 30 days (from 120 days) from the date of return submission. The new rule is applicable for the returns filed online on or after 1st August 2022. E-verification is the most convenient and instant method for verifying your ITR. However, if you prefer not to e-verify, you have the option to verify it by sending a physical copy of the ITR-V. Taxpayers who filed returns by July 31, 2023 but forget to verify their tax returns, will get the following email from the tax department, as per ClearTax. If your ITR is not verified within 30 days of e-filing, it will be considered invalid, and may be liable to pay a Late Fee. Aadhaar OTP | EVC through bank account | EVC through Demat account | Sending duly signed ITR-V through s

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