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GST 04

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  1. Opting Out of Composition Scheme:

    • Taxpayers who initially registered under the composition scheme but later decide to opt out and switch to the regular GST scheme need to file GST CMP-04.
    • This decision could be due to various reasons, such as crossing the turnover threshold, finding the regular scheme more beneficial, or other business considerations.

  2. Details Included in GST CMP-04:

    • Basic details of the taxpayer, including GSTIN (Goods and Services Tax Identification Number).
    • The effective date from which the taxpayer wishes to opt out of the composition scheme.
    • Reason for opting out.
    • Declaration stating that the taxpayer will comply with the provisions of the GST law applicable to regular taxpayers.

  3. Filing Process:

    • The form must be filed online on the GST portal.
    • After filing GST CMP-04, the taxpayer must also file GST ITC-01 to claim input tax credit on stock held on the day immediately preceding the date from which the taxpayer opts out of the composition scheme.

  4. Due Date for Filing:

    • GST CMP-04 should be filed within 7 days from the date of occurrence of the event warranting opting out of the composition scheme.

  5. Consequences of Filing:

    • Once GST CMP-04 is filed, the taxpayer will no longer be eligible for the benefits of the composition scheme and will be required to file regular GST returns (such as GSTR-1, GSTR-3B) and comply with all the requirements applicable to regular taxpayers.

Benefits of Filing GST CMP-04

  • Compliance: Ensures that the taxpayer complies with GST laws and avoids penalties or interest due to incorrect filing status.
  • Input Tax Credit: Allows the taxpayer to claim input tax credit on the stock held when switching from the composition scheme to the regular scheme.
  • Transparency: Provides a clear transition process for taxpayers moving between different schemes under GST.

Penalties for Non-Compliance

  • Failure to file GST CMP-04 when required can result in penalties and interest. The taxpayer might also lose eligibility to claim input tax credits on stock held during the transition.

In summary, GST CMP-04 is a crucial form for composition taxpayers who need to switch to the regular GST scheme, ensuring a smooth transition and compliance with the GST law

Uses and Benefits
  • Who should file GST-04? Taxpayers registered under the composition scheme. Typically, small businesses with an annual turnover not exceeding a specified limit (currently ₹1.5 crore) are eligible for this scheme.
  • Purpose of GST-04: It is a quarterly return that needs to be filed by composition dealers. It includes details of outward supplies (sales) made during the quarter. It also includes details of tax paid at the prescribed composition rate.
  • Details included in GST-04: Summary of outward supplies. Details of imports of goods/services. Summary of inward supplies (purchases) from unregistered persons. Details of inward supplies attracting reverse charge. Summary of advances paid. Details of any amendments made to previously furnished details.
  • Due date for filing GST-04: The due date for filing GST-04 is 18 days after the end of the quarter.
  • Penalties for non-compliance: Failure to file GST-04 within the due date can attract penalties and interest. The late fee for filing after the due date is ₹200 per day (₹100 CGST + ₹100 SGST), subject to a maximum limit.

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Additional Disclosure

  1. Exporter/Importer Details:

    • Provide detailed information about the exporter or importer, including name, address, GSTIN (if applicable), and contact details.

  2. Description of Goods/Services:

    • Clearly specify the goods or services being exported or imported, including HS code (for goods) or SAC code (for services), quantity, unit price, and total value.

  3. Export/Import Details:

    • State whether the transaction involves export or import.
    • For exports: Mention details such as export invoice number, export invoice date, shipping bill number, port of export, and export date.
    • For imports: Provide details like import invoice number, import invoice date, bill of entry number, port of import, and import date.

  4. Currency Conversion:

    • If the transaction involves foreign currency, disclose the exchange rate used for conversion into Indian Rupees (INR).

  5. Customs Duty and IGST:

    • Specify the amount of customs duty paid (if applicable).
    • Declare the Integrated Goods and Services Tax (IGST) applicable on the transaction.

  6. Declaration of Accuracy:

    • Certify the accuracy and completeness of the information provided in the GST-04 form.

  7. Compliance with GST Rules and Regulations:

    • Ensure compliance with all applicable GST laws, rules, notifications, and circulars related to export or import transactions.

  8. Documentation:

    • Attach necessary supporting documents such as export invoices, shipping bills, import invoices, bill of entry, etc., as per the requirements of GST-04.

  9. Internal Controls and Procedures:

    • Describe any internal controls and procedures in place to ensure accurate reporting and compliance with GST regulations for export or import transactions.

  10. Certification and Sign-off:

    • If required, provide a certification from a Chartered Accountant or Tax Practitioner affirming the accuracy and completeness of the information provided in the GST-04 form.

Terms & Conditions

Documents & Detail Required

  1. Export Transactions:

    • Export Invoice: Detailed invoice issued for export sales, including all mandatory details such as exporter and consignee details, HS code of goods, quantity, value, etc.
    • Shipping Bill: Document issued by the customs authorities which contains details of the goods being exported, consignor and consignee details, port of export, etc.
    • Export Order or Contract: Document showing the terms of the export transaction between the exporter and the foreign buyer.
    • Customs Declaration Form: Form filed with customs authorities declaring the details of goods to be exported.

  2. Import Transactions:

    • Import Invoice: Invoice received for goods imported into India, including details such as importer and supplier details, HS code of goods, quantity, value, etc.
    • Bill of Entry: Document issued by customs officials that provides details of imported goods, duty payable, customs clearance details, etc.
    • Import Order or Contract: Document showing the terms of the import transaction between the importer and the foreign supplier.
    • Customs Declaration Form: Form filed with customs authorities declaring the details of goods being imported.

  3. Other Supporting Documents:

    • Packing List: Detailed list of items included in the shipment, including package dimensions, weight, and contents.
    • Insurance Certificate: Proof of insurance coverage for goods being transported.
    • Transportation Documents: Such as airway bill, bill of lading, or road consignment note, depending on the mode of transport.

  4. Financial Documents:

    • Payment Proof: Evidence of payment for imported goods or receipt of payment for exported goods.
    • Exchange Control Documents: If applicable, documents related to foreign exchange transactions associated with import or export payments.

  5. GST-04 Form:

    • The filled and signed GST-04 form itself, providing all necessary details of the export or import transactions, including GSTIN, transaction details, and compliance declarations.

  6. Additional Declarations and Certifications:

    • Any additional declarations or certifications required under GST regulations, including certifications from Chartered Accountants or Tax Practitioners if specified.

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FAQ'S

: What is GST CMP-04?

A1: GST CMP-04 is a form used by taxpayers who wish to opt out of the composition scheme under GST and revert to the regular GST scheme.

Who needs to file GST CMP-04?

Taxpayers registered under the composition scheme who want to switch to the regular GST scheme need to file GST CMP-04. This could be due to reasons like crossing the turnover threshold or finding the regular scheme more beneficial.

When should GST CMP-04 be filed?

GST CMP-04 should be filed within 7 days from the date of the event that requires the taxpayer to opt out of the composition scheme.

What information is required in GST CMP-04?

GST CMP-04 requires the following information: Basic details of the taxpayer, including GSTIN. The effective date from which the taxpayer wishes to opt out of the composition scheme. Reason for opting out. Declaration stating that the taxpayer will comply with the provisions of the GST law applicable to regular taxpayers.

How is GST CMP-04 filed?

GST CMP-04 is filed online on the GST portal. The taxpayer needs to log in to their account on the GST portal and submit the form with the required details.