GST Return Filing for Composition Scheme

  • Setindiabiz Team
  • June 5, 2024
GST Return Filing for Composition Scheme

GST Return filing is a major compliance for Composition Scheme. It is used to report a taxpayer’s GST liabilities on the basis of inward and outward supplies, imports, exports, and additional interests or cess charges. Introduced specifically for smaller taxpayers, its process has been simplified to a great extent, so that financial resources can be saved from unnecessary tax expenses. For more information, consult our GST Experts!

BRIEF SUMMARY
GST Return for Composition scheme is filed annually and quarterly. For this, taxpayers must first enroll themselves as a composition dealer. Once enrolled, the return filing process begins on the GST portal itself. Taxpayers can visit the portal, sign into their accounts, access the correct form, fill out the detailed tax summary and submit online. We’ll discuss the process in detail further.

Eligibility for Composition Scheme GST Return Filing

Usually, taxpayers who register an annual turnover limit of up to Rs.1.5 crores are eligible for GST return filing under composition scheme. However, certain categories of taxpayers are ineligible even if their turnover is below this limit. Here’s their complete list.
  • GST exempted taxpayer  
  • Casual Taxpayer
  • Ice cream, tobacco or pan masala manufacturer
  • E-commerce supplies and operators
  • Inter-state suppliers
  • NRI Taxpayer
  • TDS Deductors and TCS Collectors 
  • Input Service Distributors

Composition GST Return Filing Forms

GST Return for Composition Scheme is filed annually and quarterly as opposed to monthly for the regular scheme. The annual return is filed in GSTR 4 form, introduced in the financial year 2019-20. Prior to this, GSTR 9A was used for this purpose. Quarterly return is filed in CMP 08. Note that annual return is filed only after all the quarterly returns have been filed for that particular tax period.

How to File GST Return for Composition Scheme?

Composition Scheme GST Return Filing process can conveniently be completed on the official GST website. Both GSTR 4 and CMP 08 forms are available online. Taxpayers can directly fill in the details on the website or download the form and later upload when completed. Let’s discuss both these processes in detail.

Quarterly GST Composition Return

  1. Go to the Return Dashboard link on the GST website and open the File Return page.
  2. Enter the financial year and the quarter for which the return is due. The required CMP 08 return form will open. 
  3. Click on the Prepare Online Button  out the tax details on a self-assessment basis. File Nil return if there’s no tax liabilities or outward supplies. 
  4. After completing the form, save, preview and download a copy, if needed. 
  5. Check the tax payable and the e-cash ledger balance. If e-cash ledger has enough balance, use it to pay off the liable tax amount. If the balance is not enough, generate a challan to pay additional cash via net banking, cheque, demand draft, NEFT, or RTGS.
  6. After tax payment, agree to the declaration, and select the authorized signatory. Verify with EVC, DSC, or STAK. EVC will be received on the authorized signatory’s registered mobile number. DSC can be uploaded as a file, and STAK or Single-time authorization key can be generated on the GST secure application. 
  7. Finally, submit the return online. After submission, the return status will change to “Filed”. Download and save the final copy, if needed.

Annual GST Composition Return

  1. Visit the GST website www.gst.gov.in and go to the Annual Return Option on the Return Dashboard. This will open the File Return Page.
  2. Enter the financial year and click on the Search Button. The GSTR 4 form will appear with both online and offline filing options. Online filing option allows filling out the details on the website directly. For offline filing, GSTR 4 offline tool and GSTR 4 form JSON file must be downloaded.
  3. After choosing any one option, open the GST Annual Return Page. Enter and save the previous year turnover details. If the turnover is nil, proceed with filing a nil return. Also, in case of nil return no outward supply, inward supply, or tax liability must be reported, and all the quarterly returns must be filed as nil returns.
  4. Once the turnover details are saved, fill out the rest of the tax details in the form.
  5. Pay any additional liabilities from the e-cash ledger. If the balance is not enough, generate a challan to pay off the liabilities via net banking, cheque, demand draft, NEFT or RTGS option.
  6. Agree to the declaration. Select the authorized signatory’s name and verify using a DSC or EVC. Once the verification is complete, proceed with the final submission of GSTR 4 annual return.

Composition GST Return Filing Details

The details filed in annual and quarterly GST composition returns must be comprehensive enough for the Department to verify a taxpayer’s liability and credentials. Here’s a list of details that may come in handy during the process:
  1. Inward supplies from Registered Suppliers (Regular and Reverse Charge)
  2. Inward supplies from Unregistered Suppliers 
  3. Data on Imported Services and the associated IGST.
  4. TDS/TCS credit 
  5. Late Fees or Interest

Due Date and Late Fees for GST Composition Return

The due date for annual GST Composition Return is 30th April whereas that for quarterly return is 18th of the month following the quarter’s end. However, if the returns are not filed on time, late fees will be charged. The late fees applicable on GSTR 4 is Rs.50 per day, up to a maximum limit of Rs.2,000. If the returns are nil,, maximum late fees charges are Rs.500. Similarly, the late fees applicable on CMP 08 quarterly returns are Rs.200, up to a maximum limit of Rs.5,000.

Benefits of GST Return Filing for Composition Scheme

GST Return filing for Composition Scheme has major advantages for small taxpayers. It reduces the liability of filing tax returns from monthly to quarterly basis. The tax amount payable is also low as Composition rates range between 1% to 6% only. The entire process is online and can be conveniently completed on the GST website from the comfort of homes. There is no need to visit the GST offices time and again. Even if any challenges are encountered during the process, the taxpayer can contact the GST helpline number to resolve the issue.

GST Return filing for composition scheme is a necessary compliance for all composition dealers. Since the scheme has simplified and streamlined the compliance requirements to a great extent, the taxpayer only has to file quarterly returns in CMP 08 form and annual return in GSTR 4 form. Both these can be filed online on the GST website saving both time and effort of the taxpayer, thereby making the process more hassle-free.

Conclusion

FAQs

Q1: Is it necessary to file a GST Return for Composition Scheme?

Yes, filing composition scheme GST return is mandatory for registered composition taxpayers. They have to file quarterly and annual returns for every financial year.

Q2: Can I file an Annual GST Composition return offline?

Yes, you have the option of filing annual GST composition return in an offline mode. For this, you have to download the GSTR 4 offline tool and GSTR 4 form as JSON file.

Q3: Can I file my annual GST composition return if I missed the quarterly return for the last quarter?

No, annual returns are only filed if no quarterly returns are pending or due. If you’ve missed a quarterly return, file it with late fee charges and then opt for annual return filing.

Q4: Can I make a GST payment through a physical challan?

No, physical challans are not accepted for GST payment. Only challan generated on the GST portal are acceptable.

Q5: Can I revise GSTR 4 details?

No. Once a GSTR 4 return is filed, its details cannot be revised.

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