The rules regarding when a taxpayer can start using the composition levy option under Section 10 are outlined. If a taxpayer files their intention to use the composition levy at the start of the financial year under sub-rule (3) of rule 3, it becomes effective from the beginning of that financial year. However, if the intimation is filed under sub-rule (1) of the same rule, it becomes effective on the appointed day specified. For those filing under sub-rule (2) of rule 3, the option is only considered after the taxpayer has been granted registration. Once registered, their ability to pay tax under Section 10 becomes effective from the date specified in sub-rule (2) or (3) of rule 10. This ensures that the timing of when the composition levy can be used is clearly defined, depending on when and how the taxpayer files their intention to opt for this method of tax payment.
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4. Effective date for composition levy
(1) The option to pay tax under section 10 shall be effective from the beginning of the financial year, where the intimation is filed under sub-rule (3) of rule 3 and the appointed day where the intimation is filed under sub-rule (1) of the said rule.
