Complete Procedure for Filing CMP-02 on GST Portal

Registering under the GST composition scheme offers several advantages to taxpayers, including lower tax rates. With reduced tax payments, small businesses can maintain higher liquidity, freeing up working capital and supporting business growth.

To avail all these benefits, they will first have to qualify for this scheme. Once they do, they will need to fill out the CMP-02 form. If you are a GST-registered taxpayer and are willing to reap the benefits of this scheme, this blog is for you.

Read on to learn about the latest updates, eligibility, and how to file CMP 02 in GST.

What Is GST Form CMP-02? 

A normal taxpayer who wants to register under the composition scheme must furnish the GST CMP-02. This form can be filed anytime in a financial year or the middle of the year. When a person files this form under the composition scheme, the rules will be applicable from the succeeding month. Suppose a person furnishes this form and uploads tax invoices in January 2025, the rules will be applicable from February.

Latest Update on GST CMP-02 by the CBIC

As per the latest updates on GST CMP-02 by the CBIC, the registered person under Section 10 of the current financial year needs to go for electronic filing of the intimation in form GST CMP-02. They will need to sign this form by visiting the facilitation centre or the online portal.

The commissioner must verify the form before submission is completed. Moreover, people need to submit Form GST ITC-03 as per sub-rule (4) of rule 44 within the specified time frame.

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CBIC Advisory for the GST Composition Scheme

The CBIC has also issued an advisory for the GST payments under the composition scheme for the people filing the GST CMP-02 form.

Who Can Opt for the GST Composition Scheme?

Usually, every taxpayer is eligible to register under the composition scheme and streamline GST payments. To successfully complete the registration process, you will need to fill out the GST CMP-02 form. However, you must submit the form on or before 31^st March of the current financial year.

You should note that there is no reason to re-apply for a composition scheme for tax payment every year. However, when filing returns under this scheme, you will need to fill out Form GST ITC-03, to claim reversal of Input Tax Credit on stocks of semi-furnished goods, input products and finished goods.

How to Pick up the Composition Scheme Under GST?

Once a taxpayer successfully logs in to the GST portal, they will need to follow a set of steps to register under the composition scheme. These include:

Step 1: Move to the official unified portal of GST.

Step 2: Log in at the taxpayer’s interface using your credentials.

Step 3: Move to the ‘Services’ tab on the homepage.

Step 4: Select ‘Registration’ to move to the application form for opting composition scheme.

Step 5: Fill out the form by accurately entering all the information.

Step 6: Cross-check the inputs to minimise errors and submit the form.

You should also find out if you are eligible to apply under the composition scheme before beginning the application process.

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Who Are Eligible Taxpayers for the Composition Scheme?

Listed below are the categories of taxpayers who are not eligible to register under the composition scheme:

• GST-registered taxpayers with an average turnover of up to ₹1.5 crore in the previous financial year on a single PAN.
• A taxable person with an average turnover of up to ₹75 lakh in the previous financial year on a single PAN and enrolled in the states of Manipur, Arunachal Pradesh, Meghalaya, Nagaland, Mizoram, Tripura, Sikkim and Uttarakhand.
• Registered taxpayers with an average turnover of up to ₹50 lakh in the previous financial year on a single PAN and involved in mixed taxable supplies or supplying services.

Apart from this, you should be aware of the group of taxpayers who cannot apply under the composition scheme as per GST rules.

Who are Not Eligible Taxpayers for the Scheme?

Following are the groups of taxpayers who are not eligible to register under the composition scheme:

• People involved in the supply of some specific goods mentioned under the GST Act
• A taxable person who is involved in the inter-state supplies of goods
• Assessee who pays taxes under Section 52 and supplies goods via e-commerce operators
• Casual dealers involved in selling various consumer products
• A non-resident taxable person conducting business in India
• Manufacturers of products such as ice cream and other edible ice products 
• A person who is registered under GST as a TDS Deductor or Tax Collector
• A person who is registered under GST as an Input Service Distributor (ISD)

Stock Intimation Details Submission

It is compulsory for all taxpayers registered under the composition scheme to submit the stock intimation details as per the mentioned guidelines on the official portal.

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Step-by-step Guide to File GST CMP-02 on GST Portal

With the digitisation of the processes, GST CMP-02 can be easily filed online. The steps for filing this form on the GST portal are as follows:

Step 1: Navigate to the official GST website and log in using your credentials.

Step 2: Move to the ‘Services’ section and choose ‘Registration’ from available options.

Step 3: Next, click on the ‘Application to Opt for Composition Levy’ button.

Step 4: Go through the composition declaration and verification requirements and tick the checkbox.

Step 5: After that, select the ‘Name of Authorised Signatory’ from the dropdown list.

Step 6: Next, enter the name of the place and click on the ‘Save’ button.

Step 7: Submit a DSC if you are a company or an LLP.

Step 8: Once done, a pop-up message appears on your screen containing a warning. Click on the ‘Proceed’ button.

Upon submission of your application, you will see a success message on your screen. Moreover, you will receive an acknowledgement on your mobile number and registered email ID.

Conclusion

Learning how to file CMP-02 in GST along with the complete details of the form is essential as any mistake can lead to severe penalties. It is advisable to keep checking the latest updates from the tax authorities regarding the CMP-02 form. This will help you stay updated regarding this form and adhere to the regulations to reap maximum benefits.

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