Composition SchemevsRegular Scheme
GST Composition vs Regular Scheme
Under GST, small businesses can choose between the Composition Scheme (simpler, lower compliance) and the Regular Scheme (standard GST with input credit). The right choice depends on your turnover, customers, and whether you need to claim input tax credit. Here's a clear comparison.
| Factor | Composition Scheme | Regular Scheme |
|---|---|---|
| Turnover limit | Up to ₹1.5Cr (goods) / ₹50L (services) | No upper limit |
| Tax rate | 1% – 6% (fixed, low) | Standard rates (5-28%) |
| Input tax credit | Not available | Available |
| Can collect GST from customer | No | Yes |
| Returns filing | Quarterly (simpler) | Monthly + annual |
| Invoice type | Bill of supply | Tax invoice |
| Interstate sales | Not allowed | Allowed |
| E-commerce sales | Not allowed | Allowed |
| Best for | Small B2C businesses | B2B, larger, interstate businesses |
| Compliance burden | Low | Higher |
Choose Composition if…
- You're a small B2C business
- Your turnover is under the limit
- Your customers don't need GST credit
- You want minimal compliance
Choose Regular if…
- You sell B2B or interstate
- You want to claim input tax credit
- You sell on e-commerce platforms
- Your turnover is large
Still not sure which to choose?
Every business is different. Book a free consultation and our experts will recommend the right option for your specific situation.
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