Concept of Composite and Mixed Supply under GST

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Composite and Mixed Supply under GST is a new concept that is used to make a smooth tax process. However, Composite Supply is more or less similar to the bundle’s service enclosed in the Service Tax law. But, mixed supply is completely a new concept and there is a small margin of difference between composite and mixed supply. In this article we will discuss on Composite Supply under GST

Composite Supply under GST

The rate of specific goods or services is defined in the GST laws, but there are some situations where the supply of goods is connected, i.e., bundled and at that point, it is very much difficult to set the GST rate. So to minimize the bridge, a new concept of Composite and Mixed Supply under GST is introduced to smoothen GST Return Filing.

Composite supply is defined as the bundled products that cannot be separated and the GST rate applies to principal supply only.

For instance, if an Air Conditioner supplier offers the installation and maintenance service, then the GST rate will be applied to only the primary good, i.e., Air Conditioner but not in the services section. It means no separate tax will be levied on the installation and maintenance of AC and the reason is without this good, the service does not stand.

Likewise, a composite supply consists of two or more two products or services that are related to each other but cannot be served individually. A person can only file these taxes if he/ she has a GST Registration certificate.

Mixed Supply Under GST

It is a new concept that means, the combination of two or more goods or services packed together for a single price and they are independent.

This shows that the goods are not dependent on each other and hence comes under Mixed Supply. The taxes levied through mixed supply can be paid through GST Return Filing.

Find whether the goods or services are composite or mixed?

If the goods are naturally bundled and cannot be separated, then it comes under composite supply and if the goods of a pack can be separated, then it will come under mixed supply.

However, if the principal supply is a service such as a train or an airplane service, then such a composite supply will be counted as the supply of services. For example, if you purchase a train ticket of Rajdhani Express, then it comes under composite supply. The reason is the train offers meals and the same cannot be separated from the ticket. So, here rate of GST will be applied on principal supply, i.e., Train ticket.  However, if you are running any business, then GST Registration is a must.

GST on Sale and Leaseback transaction

If you want any other guidance related to GST Registration or GST Return filing, please feel free to talk to our business advisors at 8881-069-069.

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