How to File CMP 04 in GST?

The Composition Scheme under GST offers a simplified taxation structure for small taxpayers. It reduces their tax burden and helps them avoid paying taxes at standard rates. However, businesses sometimes find it necessary to opt out of the scheme.

Whether due to exceeding turnover limits or a change in business activities, businesses need to file CMP-04 to opt out of the scheme.

In this blog, we will discuss what CMP-04 is and how to file GST CMP-04 in GST, focusing on its steps.

What Is CMP-04?

CMP-04 is a form under the Goods and Services Tax regime which allows taxpayers to opt out or withdraw from the Composition Scheme. A composition dealer can file this form in the following three cases:

• If the dealer wants to withdraw voluntarily
• If the dealer cannot fulfil any of the conditions prescribed for availing the Composition Scheme
• A business which has registered under this scheme can file CMP-04 if it exceeds the turnover limit

Step-by-Step Guide to File GST CMP-04 on GST Portal

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Follow the steps below to file GST CMP-04 on the official GST portal:

Step 1: Sign in to the official portal with your valid credentials.

Step 2: Upon signing in, navigate to the section of 'Services' and click on 'Registration'. You can then access the 'Application for Withdrawal from Composition Scheme.'

Step 3: Once you tap on the application page, it will redirect you to the page 'Intimation/Application for Withdrawal from Composition Levy'. Select the specific date under the 'Date' section. It is important to remember that you cannot select a withdrawal date which is earlier than the date when you opted for the Composition Levy. In addition to this, select the reason from the dropdown menu for withdrawal.

Step 4: Below the reason and date sections, you will find a declaration section of ‘Composition Declaration’. Go through the Composition Levy’s terms and conditions and restrictions. If you agree, tick the checkbox.

Step 5: After the ‘Composition Declaration’, you will find a section of ‘Verification.’ If you tick the checkbox, it will imply that you agree to the accuracy of the information that you have provided. Additionally, it also implies that you have not hidden any relevant information from the appropriate authority.

Step 6: For completion of the procedure, tap on the ‘Composition Declaration’ and ‘Verification’ boxes. Then, select the authorised signatory’s name and mention the place of signature. Finally, tap on ‘Save'. 

Step 7: Next, verify or sign the form with a digital signature like DSC/EVC. It is important to note that you will require EMSigner software for the DSC option. In case you select DSC, tap on the option, ‘Submit with DSC’ and then, tap on ‘Proceed'. 

Step 8: The EMSigner page will not be displayed on the screen. Select your preferred signature and tap on ‘Sign'. 

Step 9: You can also sign using the EVC option. In that case, tap on the 'Submit with EVC' option and you will receive an OTP (One-Time Password) to your email address and mobile number. Once you receive it, enter the code to verify the submission of the form.

Upon going through the abovementioned steps, you will receive a 'Success' message on your mobile number. Additionally, you will also receive an ARN (Application Reference Number) on both your email address and mobile number within 15 minutes of completion of authentication or verification.

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Conclusion

Now that you are aware of how to file CMP-04 in GST, consideration of tax obligations and business requirements is essential. Whether you choose to voluntarily opt out, exceed the limit of turnover for traders or fail to fulfil any of the required conditions, filing of GST CMP-04 is crucial to maintain compliance and shift smoothly to the regular GST regime.

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