GST & Business
GST Composition Scheme Eligibility
Decision aidQuick answer: The FinTax24 GST Composition Scheme Eligibility Checker uses your estimated annual turnover, business type, special-category-State flag, inter-State supply flag, e-commerce presence, restaurant-only flag and ITC-buyer need to determine whether your business is eligible, blocked, or borderline — citing Section 10 of the CGST Act and Rule 6(2B) of the CGST Rules.
GST Composition Scheme Eligibility
Determine if your business qualifies for the GST Composition Scheme  checks turnover, business type, inter-State and e-commerce flags.
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Disclaimer: Results are for indicative purposes only and may vary based on actual rates, rules, and policies. Please consult a FinTax24 expert for binding advice.
How to use this calculator
Follow these 5 steps for an accurate result.
- 1
Estimate annual turnover
Project FY 2026-27 aggregate turnover including inter-State stock transfers.
- 2
Pick business type
Manufacturer / Trader / Restaurant service / Other service — sets the threshold + composition rate slab.
- 3
Flag State category
Tick if your principal place of business is in a special-category State.
- 4
Flag inter-State + e-commerce + ITC
Each of these flags is independently blocking — even one disqualifies composition.
- 5
Read verdict + action
See "Eligible / Not eligible / Not eligible (above threshold / inter-State / e-commerce / ITC conflict)" plus the recommended next step.
Key takeaways
- Composition cap is ₹1.5 crore for goods/restaurants (₹75 lakh in special-category States) and ₹50 lakh for other services (₹25 lakh in special-category States).
- Any inter-State supply auto-exits composition — even one consignment triggers exit (Section 10(2)(a)).
- E-commerce sales via Amazon / Flipkart / Zomato block composition (Rule 6(2B)).
- Composition dealers can only issue a bill of supply — buyers cannot claim ITC, which usually disqualifies B2B deals.
Frequently asked questions
Quick answers to common questions about gst composition scheme eligibility.
What is the turnover cap for the composition scheme?
Aggregate turnover up to ₹1.5 crore for manufacturers, traders, and pure restaurant service (₹75 lakh in special-category States). For other services the cap is ₹50 lakh (₹25 lakh in special-category States). These thresholds were notified in Notification 14/2019-CT (as amended) and remain unchanged as of FY 2026-27.
What is the composition tax rate for services?
For services other than restaurant service, the composition rate is 6% of turnover (3% CGST + 3% SGST, or 6% IGST for inter-State — though inter-State is not composition-eligible). For restaurants the rate is 5% (2.5% CGST + 2.5% SGST).
Can composition dealers sell through Amazon or Flipkart?
No. Rule 6(2B) of the CGST Rules disqualifies composition for any taxpayer supplying through an e-commerce operator required to collect TCS at source (Amazon, Flipkart, Myntra, Nykaa, Zomato, Swiggy, etc.).
What happens if my turnover crosses the cap mid-year?
You must file FORM GST REG-01 as a regular taxpayer within 30 days of crossing the cap. Any unclaimed ITC on stock at the time of crossing is lost — composition taxpayers cannot retrospectively claim ITC.
Can I switch back to composition after exiting?
Once you exit composition, you cannot opt back in for one year from the date of exit. Plan the exit timing carefully — most businesses should stay on the regular scheme for at least two years before reconsidering.
Sources & authority: For regulations on gst composition scheme eligibility, refer to gst.gov.in, mca.gov.in, incometax.gov.in, rbi.org.in, CGST Act Section 10, CGST Rules Rule 6, Notification 14/2019-CT.
Last reviewed by: FinTax24 Indirect Tax Desk · Reviewed on:
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