Verified · 29 Sept 2026
Composition Scheme Calculator – GST Eligibility
Check whether you can opt for the composition scheme, the turnover limit for your state, and the tax you'd pay.
✓ Verified against official notifications · 29 Sept 2026 · How we verify →
Recent change: GST 2.0: 4 slabs collapsed to 5% / 18% with 40% de-merit rate (22 Sept 2025)
You can opt for composition
Composition rate
1%
of turnover (CGST + SGST)
Tax at this rate
₹90,000
on the turnover entered
- Composition taxpayers cannot collect tax from customers or claim input tax credit, and must issue a bill of supply.
- Returns: CMP-08 quarterly and GSTR-4 annually.
FY 2026-27 · GST 2.0 slabs (5% / 18% / 40%) from 22 Sept 2025 · interest on net cash only (s.50 proviso, CBIC Circular 26/2022)Verify on gst.gov.in →Share on WhatsApp
For estimation only. This calculator applies the rules as we understand them on 29 Sept 2026. It is not legal or tax advice. Verify with the official notification or consult a Chartered Accountant / labour-law professional before filing or changing payroll.
Did this tool give you the right answer?
What composition costs and saves
A composition dealer pays a flat rate on turnover and skips monthly returns, but gives up input tax credit and cannot charge GST to customers. A trader in Maharashtra with ₹90 lakh of taxable turnover pays 1%, which is ₹90,000 a year, split ₹45,000 CGST and ₹45,000 SGST, out of their own margin.
| Business | Rate | Turnover limit |
|---|---|---|
| Manufacturer | 1% | ₹1.5 crore (₹75 lakh in some North-Eastern states) |
| Trader | 1% of taxable turnover | ₹1.5 crore (₹75 lakh) |
| Restaurant not serving alcohol | 5% | ₹1.5 crore (₹75 lakh) |
| Service provider (separate scheme) | 6% | ₹50 lakh |
When composition is the wrong choice
- Your buyers are businesses. They cannot claim credit on a bill of supply, so they will either ask for a lower price or buy from a regular dealer.
- Your purchases carry a lot of GST. A trader buying at 18% and selling at a thin margin pays 1% on top of credit they cannot use.
- You sell to other states. Composition dealers cannot make inter-state supplies at all.
Composition suits businesses that sell mostly to consumers inside the state, such as neighbourhood shops and small restaurants.
Rules that apply once you opt in
- File CMP-02 before the financial year starts. The choice covers every GSTIN under your PAN.
- Pay tax quarterly through CMP-08 by the 18th after each quarter, and file GSTR-4 by 30 April after the year.
- Write “composition taxable person, not eligible to collect tax on supplies” on every bill of supply, and display “composition taxable person” at your premises.
- Pay reverse charge tax at normal rates where it applies. Composition does not change it.
- A manufacturer or trader may supply services worth up to 10% of turnover or ₹5 lakh, whichever is higher, without losing the scheme.
Crossing the limit during the year
Eligibility lapses on the day turnover crosses the limit. File CMP-04 within seven days, and from that day charge GST on tax invoices at normal rates. You can then claim credit on stock in hand through ITC-01. The registration checker covers the thresholds for regular registration.
Official sources
Frequently asked questions
What is the composition limit?
₹1.5 crore for goods (₹75 lakh in some North-Eastern states and Sikkim), and ₹50 lakh for service providers under the separate scheme.
What are the composition rates?
1% for manufacturers and traders, 5% for restaurants (no alcohol), and 6% for service providers — split equally between CGST and SGST.
Can composition dealers sell online?
Since 1 October 2023 they can supply goods through e-commerce operators within their state. Supplying services through e-commerce is not allowed.
Can I claim ITC under composition?
No, and you cannot charge GST on your invoices. You issue a bill of supply.