What is Annual Aggregate Turnover (AATO) Under GST & How to Calculate It?

The term Annual Aggregate Turnover (AATO) is introduced under Goods and Services Tax (GST) law. AATO means the annual turnover of a business at PAN level with a few inclusions and exclusions. Also, a business whose aggregate turnover in a financial year exceeds Rs.40 lakhs (or Rs.20 lakh for special category states, Puducherry, and Telangana) has to mandatorily register under GST. For service providers, this limit is Rs.20 lakhs (for normal category states) and Rs.10 lakh (for special category states).  

This article explains the meaning of annual aggregate turnover, its purpose, components, how to calculate, and turnover in state.

What is Annual Aggregate Turnover (AATO) under GST?

The aggregate turnover computed for the entire financial year between April of a year up to March of next year is called annual aggregate turnover.

As per GST law, “aggregate turnover” refers to the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on Reverse Charge Mechanism (RCM) basis), exempt supplies, exports of goods or services or both and inter-state supplies of persons having the same Permanent Account Number (PAN) computed on an all-India basis.

What is the purpose of calculating AATO?

The annual aggregate turnover at PAN level is required to check the: 

• Threshold limit for GST registration
• Eligibility for the composition scheme

What are the components of Annual Aggregate Turnover (AATO)?

AATO under GST is the total turnover calculated at a PAN level (all GSTINs put together). In simple words, it is the sum of the following:

• Taxable sales value
• Exempt sales value
• Export of goods and services
• Interstate supplies by the business to its sister concern under the same PAN
• Interstate stock transfer or supplies between distinct persons under the same PAN

Points to be noted:

• Taxable sales value shall exclude RCM purchases
• Sales subject to RCM must be included in the taxable supplies
• Do not consider tax components, such as the central tax, state tax, union territory tax, integrated tax and cess.

How to calculate AATO? 

You have to add up all the above mentioned sales and stock transfers value to arrive at the annual aggregate turnover.

Here are the examples on AATO calculations:

Example 1: Annual turnover calculation (for normal category states under GST)

Suppose Mr. A owns a tea estate with an annual turnover of Rs.1.60 crore by selling tea leaves. This activity is exempt from GST. Also, Mr. A supplies plastic bags along with his crop and charges separately for this. His turnover from the sale of plastic bags is Rs.5 lakhs which attracts GST.

Annual aggregate turnover = 1.6 crore + 5 lakh = 1.65  crore

Even though the taxable turnover is only Rs.5 lakhs, Mr. A must register under GST because his aggregate turnover exceeds the threshold limit of Rs. 40 lakh.
Further, Mr. A does not have the option to register as a composition dealer because this aggregate turnover exceeds the threshold limit of Rs.1.5 crore.

Example 2: Annual turnover calculation (for special category states under GST)

First of all let's take a look at the special category states under GST:

Now, moving on to example, let's assume that Mr. B, a farmer living in Nagaland sold Rs.25 lakh worth crops in a year. Also, he sold plastic bags worth Rs.50,000.

Annual aggregate turnover = 25 lakh + 5 lakh = 30 lakh 

So, Mr. B must register under GST as his aggregate turnover exceeds the threshold limit of Rs.20 lakh for special category states.

What is turnover in state under GST?

Turnover in state is different from the aggregate turnover definition. It refers to the turnover of an entity effected within a particular state. . However, the composition levy would be calculated on the basis of turnover in state.

It includes:

• Aggregate value of all taxable supplies (excluding inward supplies on which tax is payable under RCM)
• Exempt supplies made within the state/union territory
• Exports of goods or services
• Inter-state supplies of goods or services made from the state or union territory.

However, it excludes stock transfers and taxes such as CGST, SGST, UTGST, IGST, and cess.

Reference of aggregate turnover across GST law

For further understanding, read our below articles:

• Steps to register under GST
• How to file GSTR-1 on the GST portal
• Step-by-step process to file CMP-08 by composition taxable persons