AGGREGATE TURNOVER UNDER GST
A business whose aggregate turnover in a financial year exceeds Rs 20 lakhs has to mandatory register under Goods and Services Tax. This limit is set at Rs 10 lakhs for North Eastern and hilly states flagged as special category states.
The law says that “aggregate turnover”: –
Means the aggregate value
- of all taxable supplies, excluding the value of inward supplies on which tax is payable by a person on reverse charge basis,
- exempt supplies,
- exports of goods or services or both and inter-state supplies of persons having the same Permanent Account Number,
To be computed on an all-India basis but excludes Central tax, State tax, Union territory tax, Integrated tax and cess.
Let us consider a practical scenario to gain a better understanding of the aggregate turnover:
Mr. Anil Kumar is a farmer. His annual turnover is of INR 66, 00,000 lakh. This being an agricultural income, the turnover would be exempted from GST. However, Mr. Anil Kumar also supplies cardboard cartons along with his yield for which he charges separately. He yields INR 1, 20,000 from the sale of cardboard cartons. This turnover of INR 1, 20,000 would be
chargeable to GST. As defined by law, Mr. Anil Kumar needs to get registered under GST because his aggregate turnover exceeds the threshold limit of INR 20, 00,000 lakh. Though, as his aggregate turnover is less than Rs. 1.5 Crore he may opt for the composition scheme and register himself as a composite dealer.
Hey, For more basics of GST refer our other blogs by clicking here: –
- What is GST?
- Advantages and Disadvantages of GST?
- E-Way bill?
- Exemption List under GST?
- Types of GST Taxes?
Which states are considered as special category states as per GST?
Below is the list of states which are assigned special status and are called special category states under GST Law:
- Arunachal Pradesh
- Jammu & Kashmir
- Himachal Pradesh
The threshold limit of aggregate turnover for all the above states is Rs. 10 lakh.
What is to be included while calculating the aggregate turnover?
For calculating the aggregate turnover, value in respect of all the following supplies on all India bases shall be calculated
- Total value of supply from taxable goods and/or services,
- Total value of supply from exports of goods and/or services,
- Total value of supply from exempted goods and/or services,
- Total value of supply from nil rated goods and/or services,
- Total value of supply from non-gst goods and/or services,
- Total value of interstate supplies between distinct persons having same PAN.
What is the Impact of Aggregate Turnover under GST on the Current Situation?
Most of the industry experts have anticipated that GST will expand the taxpayer base in India. The small business owners who were only in the manufacturing sector pre-GST have suffered due to lowering of GST registration exemption limit; as in pre-GST regime, the registration under Central Tax (Excise Duty) had the basic exemption limit of Rs.1.5 crores. Registration under GST will certainly upsurge the compliance cost for small businesses in the short run. However, in the long run, it will surely be of their benefit since the data accumulated by the government will help them to come up with better and more practical policies for small businesses in the future.
Have you filed your GST Returns Yet?
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Geetika Goyal (Team Itslyf)
AGGREGATE TURNOVER UNDER GST
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