Aggregate Turnover Under GST
GST Law & Practice Notes
B.Com 6th Sem CBCS Pattern
What is Aggregate Turnover under GST?
In common parlance, turnover is the total value of sales in money value of a business. The aggregate turnover is a crucial parameter for deciding whether GST registration is required or not. The aggregate turnover is different from turnover in a state. The aggregate turnover is used for determining the threshold limit for registration as well as eligibility for composition scheme. However, the composition levy would be calculated on the basis of turnover in the state. Aggregate turnover is very important under GST Act because it is the basis of GST liability assessment.
According to Sec 2(6) of the GST Act, “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 all India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess.
Aggregate Turnover” includes
As per Sec 2 (6) of the GST Act, 2017, “Aggregate Turnover” includes:
a) The value of exported goods/services.
b) Exempted goods/services or both which attracts nil rate of tax or wholly exempt from tax and includes non-taxable supply.
c) Inter-State supplies between distinct persons having same PAN
d) Supply on own account and on behalf of principal.
Aggregate Turnover” Excludes
But “Aggregate Turnover” does not include:
a) Inward supplies on which the recipient is required to pay tax under Reverse Charge Mechanism (RCM).
b) Central tax (CGST),
c) State tax (SGST),
d) Union territory tax and
e) Integrated tax (IGST)
f) Compensation Cess
Aggregate Turnover and GST Registration Limit:
Aggregate turnover is important for any business because it decides whether or not a business need to register and pay under GST Act. The threshold limit for registration under GST Act is Rs. 40 lakhs for goods and Rs. 20 lakhs for services. It also determines whether or not business is eligible for composition scheme.
The Central Government vide Notification No. 14/2019-Central Tax, dated 07th March, 2019 notified that an eligible registered person, whose aggregate turnover in the preceding financial year did not exceed 1.5 Crores, may opt to pay tax under Composition scheme. However, the said aggregate turnover shall be 75 lakh in case of persons registered under following States:
- Arunachal Pradesh