- Small taxpayers having aggregate turnover up to 50 lakhs can pay tax which shall not be less than 1% of aggregate turnover and they are not allowed to take input credit.
- Tax payers making inter-state supply or paying tax on reverse charge basis shall not be eligible for composition scheme. The composition scheme can only opted by traders and manufacturers, not by service providers.
Job worker is the person who processes or works upon the raw materials or semi-finished goods supplied to him, so as to complete a part or whole of the process resulting in the manufacture or finishing of an article or any operation which is essential for the aforesaid process.
In GST job worker is required to take registration if aggregate turnover exceeds threshold limit.
Only registered principal can supply the taxable goods to job worker without payment of tax. He can further send goods from one job worker to another job worker.
If the goods of principal are supplied directly from the job worker then it is included in the principal’s turnover, provided the job worker must be registered and the principal has to declare such place as an additional place of business or goods must be notified.
Treatment of credit on inputs/capital goods
In respect of the inputs in goods and capital goods, the principal could claim the credit on inputs only when the supplied goods to job worker are returned to principal in 180 days from the date of being sent out. In case of the goods are sent to job worker directly the days will be counted from the date of receipt of inputs by job worker. Further an amount equivalent to the input tax credit availed on such inputs has to be paid along with interest, in case the inputs are not received back within the specified time. The credit can be reclaimed when the inputs are actually received back.