REGULAR SCHEME
As per Section 23 of the CGST Act, each and every person is required to obtain the GST registration if their turnover from supply of goods or services exceeds Rs. 20 lakhs. From 1 April 2019, this threshold limit has been increased to Rs. 40 lakhs only if supplier is engaged in supply of goods. If supplier is engaged in services then the threshold limit is same as before that is, Rs 20 Lakh.
COMPOSITON SCHEME
The threshold limit on gross turnover of Rs 1 crore has been increased to 1.5 crore.
Example: A shopkeeper annual turnover is 45 Lakh in Financial Year 2019-20 so GST becomes required for him. Now he register himself under composition scheme. But in current financial year his annual turnover become 1.5 crore then he has to convert himself under REGULAR Scheme.
What is Threshold Limit
In the context of Goods and Services Tax (GST), the term “threshold limit” typically refers to the minimum turnover or sales that a business must reach before it becomes liable to register for GST and start collecting and pay GST to the tax authorities.