# Composition Scheme: Additional Conditions & Procedure
A composition supplier is on a concessional regime — therefore the law imposes several disabilities and disclosures.
## Conduct Requirements
| # | Requirement |
|---|---|
| (i) | Cannot collect tax from recipient. Must issue a Bill of Supply (not a tax invoice). |
| (ii) | Bill of supply must carry the words: "composition taxable person not eligible to collect tax on supplies". |
| (iii) | Must display "composition taxable person" at every place of business. |
| (iv) | RCM is not exempted — must pay tax under RCM at normal rates on inward supplies taxable under RCM. |
| (v) | Cannot claim Input Tax Credit (neither on its own purchases nor on RCM payments). |
## PAN-wide Rule (All-or-None)
All registered persons having the same PAN must opt for composition together. If any one of them is ineligible or opts out, all become ineligible.
## Multi-state Aggregate Turnover Rule
If a person has businesses in multiple States/UTs, the lowest applicable turnover threshold of those States applies for ALL of them.
(Special category States like Manipur have ₹75 lakhs; other States ₹1.5 cr.)
## Opting In and Out
| Situation | Form / Action |
|---|---|
| Opting at the time of registration | Part-B of Form REG-01 |
| Already registered, opting in for a new FY | Form CMP-02 before start of the FY |
| Failure to comply with conditions | File intimation within 7 days of breach; pay normal tax thereafter |
| Voluntary opting out | File a withdrawal application |