A retail medical store is a goods business selling products at medicine rates — mostly 5% and 12%. It’s a steady, well-defined GST case, with a couple of retail-specific points around the composition scheme and handling expired-stock returns.
Rates on the counter
Medicines are taxed mainly at 5% and 12%, with some items at 18% and a few at nil — so your counter carries a few rate lines. Selling at the printed MRP means the GST is built into the price; your billing needs to apply the correct rate per product so your output tax is right. Correct HSN on your product list keeps this consistent.
Composition or regular?
A retail pharmacy up to ₹1.5 crore can consider the composition scheme (1% flat, simple quarterly filing) if it sells purely locally and doesn’t need input credit. Many pharmacies instead stay on regular registration to claim input credit on their purchases from distributors. We assess which genuinely works out cheaper for your store.
Expiry, returns and reconciliation
- Expired-stock returns to distributors are handled through credit notes in your returns
- Purchases from distributors need ITC reconciliation against GSTR-2B (if on regular scheme)
- Correct HSN and rate per medicine on the billing system
- Monthly (or quarterly) GSTR-1 + GSTR-3B