GST Composition Scheme Calculator
The composition scheme under Section 10 of the CGST Act lets small businesses pay a flat percentage of turnover instead of tracking output tax and input credit on every transaction. The price is simplicity: no ITC, no tax collection from customers, no inter-state sales, and a quarterly CMP-08 payment plus one annual GSTR-4. This calculator computes the quarterly tax and checks the main eligibility conditions in one go.
Rates and limits
- Traders of goods: 1% (0.5% CGST + 0.5% SGST) of taxable turnover in the state
- Manufacturers: 1% of total turnover in the state
- Restaurants not serving alcohol: 5% of turnover
- Service providers / mixed suppliers (Section 10(2A)): 6% of turnover, limit ₹50 lakh
- Turnover limit: ₹1.5 crore aggregate turnover in the preceding year (₹75 lakh in Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura and Uttarakhand)
- Goods dealers may supply services up to 10% of turnover or ₹5 lakh, whichever is higher
Who cannot opt in
Manufacturers of ice cream, pan masala, tobacco, aerated water and (from 2022) fly-ash bricks and certain other notified goods; anyone making inter-state outward supplies; casual or non-resident taxable persons; and suppliers of services through e-commerce operators who collect TCS. Sale of goods through e-commerce has been permitted since 1 October 2023.
Worked example
A Sikar kirana trader has quarterly turnover of ₹15 lakh of which ₹2 lakh is exempt (fresh vegetables, loose grain). Taxable turnover ₹13 lakh × 1% = ₹13,000, paid as CGST ₹6,500 + SGST ₹6,500 in CMP-08 by the 18th of the month following the quarter. If the trader also paid a GTA freight bill under reverse charge, that tax (at the normal 5%) is paid in addition and no credit is available.
Composition or regular?
Composition suits businesses selling mainly to consumers with low input credit — restaurants, small retailers, repair shops. If most customers are registered businesses who want ITC, or if input tax on purchases is large, the regular scheme usually works out cheaper despite the extra compliance. The invoice must be a "Bill of Supply" carrying the words "composition taxable person, not eligible to collect tax on supplies".
Frequently Asked Questions
Can a composition dealer charge GST on the bill?
No. Tax is paid out of pocket on turnover and cannot be collected from the customer. Issue a Bill of Supply, not a Tax Invoice.
What returns does a composition dealer file?
CMP-08 quarterly by the 18th of the following month, and GSTR-4 annually by 30 June of the next financial year.
Does aggregate turnover include exempt sales?
Yes. For the ₹1.5 crore eligibility test, aggregate turnover on an all-India PAN basis includes exempt supplies. Traders pay 1% only on the taxable portion though.
Can I buy from other states under composition?
Yes, inter-state purchases are allowed; only inter-state outward supplies are prohibited.
Disclaimer: This tool is for general information and estimation only. Tax rates and rules change — verify with official sources or a professional before acting. Read full disclaimer.