Form GST CMP-04: Application for Withdrawal from Composition Levy
Goods and Services Tax Network (GSTN) has recently introduced form GST CMP-04 for withdrawal from composition levy on small taxpayers. This is a major relief for small taxpayers who had registered under composition scheme and were not able to carry out inter-state and business to business supplies. Some of the drawbacks of composition scheme under GST are:
- Non-availability of input tax credit.
- Prohibition on issuing GST Invoice and transfer Input Tax Credit
- Prohibition on Inter-State Supplies
- Prohibition on collection of tax from consumers
- Payment of GST Liability out of taxpayer’s own pocket.
Though a taxpayer is required to file fewer returns and very limited GST compliance burden, however, most of the dealers were waiting for the opportunity for withdrawal from composition levy and register as a normal taxpayer.
This facility is now made available under Registration Tab on GST portal. This facility is available for limited time and taxpayers who want to withdraw composition levy shall do it as soon as possible. The taxpayer needs to file form GST CMP-04 on GST common portal. Most of the information is auto-filled at the time of login and the taxpayer has to merely confirm is a check-box and authorizing by way of Electronic Verification Code (EVC) or Digital Signature Certificate (DSC) in case of private limited company or Limited Liability Partnership Firm (LLPs)
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