“Aggregate Turnover” under GST

What is the definition of “Aggregate Turnover” under GST?

The term "Aggregate Turnover" under GST, defined in section 2(6) of the CGST Act, 2017, refers to the total value of all taxable supplies (excluding inward supplies subject to reverse charge), exempt supplies, exports of goods or services, and inter-State supplies by individuals with the same Permanent Account Number. This calculation is done on a pan-India basis but excludes central tax, State tax, Union territory tax, integrated tax, and cess.

Where the term “aggregate turnover” is used in GST?

1. As per section 22(1) of the CGST Act, 2017, GST registration is mandatory for every supplier if his aggregate turnover in a financial year exceeds the specified limits. 
2. As per section 10(1) of the CGST Act, 2017, a taxpayer can opt for a composition levy if his aggregate turnover in the preceding financial year did not exceed fifty lakh rupees.

Does Aggregate turnover include inward supplies on which GST is paid on an RCM basis?

No. Aggregate turnover does not include inward supplies on which GST is paid on a Reverse charge basis.

Does Aggregate turnover include outward supplies on which GST is paid on an RCM basis by the buyer?

Yes. Aggregate turnover includes outward supplies on which the buyer pays GST on an RCM basis.

Does Aggregate turnover include the value of exempt supplies and exports with or without tax payment?

Yes. Aggregate turnover includes the value of exempt supplies and exports with or without tax payment.

Does aggregate turnover include the amount of CGST, SGST, IGST, and cess?

No. Aggregate turnover does not include the amount of CGST, SGST, IGST, and cess.

How to calculate aggregate turnover for GST registration limit?

Any supplier must register under this Act in the State or Union territory, excluding special category States, from where they provide taxable goods or services if their aggregate turnover in a financial year surpasses twenty lakh rupees.

For special category states, this limit is ten lakh rupees. For the supplier who is engaged exclusively in the supply of goods, this limit is enhanced to forty lakh rupees.

For the purposes of these provisions, the expression "aggregate turnover" shall include all supplies made by the taxable person, whether on his own account or made on behalf of all his principals.

Also, it is to be noted that aggregate turnover for registration applicability is to be calculated on an all-India basis and not only turnover in that particular state.

How to calculate aggregate turnover for the Composition levy?

As per section 10(1), a registered person, whose aggregate turnover in the preceding financial year did not exceed fifty lakh rupees, may opt to pay taxes under the composition scheme. This aggregate turnover is to be calculated on an all-India basis.

To calculate the aggregate turnover of an individual for assessing their tax liability under this section, the term "aggregate turnover" should encompass the value of supplies made by the individual from April 1st of a financial year until the date they become liable for registration under this Act. However, it should not comprise the value of exempt services provided through extending deposits, loans, or advances, where the consideration is represented by interest or discount.

However, it is pertinent to note that taxes under composition levy will be calculated on turnover in State/union territory and not on an all-India basis.

Conclusion

In conclusion, understanding the concept of "Aggregate Turnover" is crucial for complying with GST regulations. It encompasses various aspects such as taxable supplies, exempt supplies, exports, and inter-State supplies, while excluding certain taxes and inward supplies subject to reverse charge. Knowing how to calculate aggregate turnover is essential for determining GST registration eligibility and opting for the composition levy. By adhering to these guidelines, businesses can ensure compliance with GST laws and streamline their tax obligations effectively.