To check whether your business can use India’s GST Composition Scheme, first calculate aggregate turnover for every business location and GST registration linked to the same PAN across India. Then compare it with the current limit for your composition category and state or union territory, screen the business against the scheme’s other conditions, and weigh the tax and invoicing trade-offs before opting in. Being below a turnover limit alone does not establish eligibility.
Run these eligibility checks in order
| Test | What to check | Where to verify |
|---|---|---|
| Taxpayer and registrations | Identify the PAN and every GST registration and place of business associated with it. Do not assess one GSTIN or shop in isolation. | CGST Act and composition rules |
| Aggregate turnover | Work out the statutory, all-India total for the relevant preceding financial year, across the same-PAN registrations. | CGST Act and CBIC FAQs |
| Applicable limit | Confirm the current threshold for the business’s category and state or union territory; do not rely on an old headline figure. | Current Act, applicable state or union territory provisions, and notifications |
| Other conditions | Check the taxpayer’s status, supplies, goods, sourcing and other restrictions that apply to the exact business. | CGST Act, composition rules, and relevant current notifications |
| Business fit and filing | Compare the consequences with regular taxation and confirm the live GST Portal process and applicable timing. | CBIC FAQs, GST Portal registration manual, and current portal instructions |
Calculate aggregate turnover for the whole PAN
The Act’s aggregate-turnover definition is broader than taxable domestic sales. It covers the value of taxable supplies, exempt supplies, exports and inter-State supplies associated with the same PAN, on an all-India basis. It excludes central, state, union territory and integrated taxes, as well as compensation cess. Apply the statutory definition to your records rather than using a single return total as a shortcut. See the CGST Act and CBIC FAQs.
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For an auditable calculation, gather sales ledgers and invoices, exempt-supply and export records, inter-State supply data, and turnover information for every registration under the PAN. Separate inward supplies and amounts excluded by the definition. Reconcile the records across registrations before comparing the result with a threshold. The rules also address the effect of opting for one place of business on other places under the same PAN, so check the composition rules rather than treating each registration as an independent eligibility decision.
Verify the current threshold for your category and location
There is no safe single threshold to apply to every business. The applicable limit depends on the statutory composition route and state or union territory treatment. The general goods route and the separate route for eligible service suppliers have different conditions, so confirm which category fits your business before looking up its limit.
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A GST Portal functionality notice from 2021 described PAN-based checks and limits of ₹1.5 crore or ₹75 lakh for the respective states or union territories at that time. Those are historical figures, not a complete statement of the current threshold schedule. Use the 2021 GST Portal notice only as dated context; check the current Act, applicable state or union territory provisions, and notifications for your category and location before relying on a number.
Check for disqualifications and special conditions
Even a business below its applicable turnover limit can fail another condition. Read the current statutory text and rules against the facts of the business, including its taxpayer status, outward supplies, goods sold or manufactured, stock and sourcing circumstances, and registration footprint. The CGST Act and composition rules set out the legal framework.
CBIC explanatory material names ice cream, pan masala and tobacco products among examples of excluded manufacturers and discusses restrictions involving inter-State supplies and e-commerce. Some answers in the CBIC FAQs and sectoral FAQs are older, so verify the current provision and any later notification rather than treating an FAQ as the final word.
If you sell through an e-commerce operator
Do not assume that every sale through an e-commerce operator automatically bars composition. The treatment can depend on the current law and the exact operator and supply arrangement. Check the applicable statutory text and notifications for your sales channel before opting in.
Decide whether composition suits the business
Eligibility and suitability are separate questions. CBIC FAQs explain that composition taxpayers cannot claim input tax credit on inward supplies and cannot collect composition tax from customers as a regular taxpayer collects GST on a tax invoice. Consider how those restrictions affect your costs, prices, invoicing and customers’ expectations.
| Consideration | Composition scheme | Regular taxation |
|---|---|---|
| Input tax credit on inward supplies | Not available, according to CBIC FAQs | Compare the regular-scheme treatment applicable to your circumstances |
| Tax charged to customers | Composition tax cannot be collected from customers in the way GST is collected on a regular tax invoice, according to CBIC FAQs | Compare the invoice and tax treatment applicable to your circumstances |
| Commercial fit | Assess the effect of the credit and invoicing restrictions on pricing and customer relationships | Assess whether the regular scheme better fits input costs and customer requirements |
Do not choose solely by comparing a headline tax rate or assuming the composition route is automatically cheaper. Include the administrative burden and the possibility that a change in turnover or activity may require a move to regular taxation.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Opt in through the applicable GST Portal process
The route and timing depend on whether you are applying for registration or are already registered under the regular scheme. The GST Portal registration manual describes a composition choice in the registration flow and advises applicants to consider whether likely aggregate turnover will remain below the applicable limit. Existing regular taxpayers use the prescribed option process; the rules and portal materials refer to FORM GST CMP-02. Confirm the live portal instructions and filing window for your circumstances rather than relying on a dated guide.
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Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →Repair Windows errors before they cause bigger problemsFix Now →Scan for outdated or missing drivers - takes under a minuteDriver Scan →A GST Portal forms index dated 2019 lists CMP-02 for opting in, CMP-03 for stock details in relevant cases, and CMP-04 for withdrawal. Because that index is old, treat it as an orientation aid, not proof that the form process or deadlines are unchanged. Check the current composition rules and portal instructions before filing. The forms index is available here.
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Keep checking eligibility after opting in
Composition eligibility is not permanent approval. Monitor turnover and changes in the business’s activities or supply arrangements. The rules provide for moving to the regular-tax regime when conditions cease to be met and prescribe withdrawal procedures; check the current rules for the triggering date, filing requirements and treatment of stock or credit. If your business has multiple GSTINs, inter-State activity, e-commerce sales, goods that may be excluded, or turnover near its applicable limit, have a chartered accountant or GST practitioner review the calculation and eligibility before filing.
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