QRMP- A headache we never asked
Half baked solution & probably Worst Innovation of GSTN
ARTICLE ON PROBLEMS / LIMITATIONS in QRMP SCHEME
QRMP- It is introduced as ‘Quarterly Return Filing and Monthly Payment of Taxes (QRMP)’ scheme under GST to help the taxpayers having turnover less than Rs. 5 crores. QRMP as we all know that it is scheme for Small dealers (only applicable to those who are having TO less than 5 crores) for giving relaxation in monthly compliances and a middle way to collect monthly tax from them. However, when you go deeper, It Seems same as earlier. It is monthly system with monthly compliance and additionally Quarterly compliances. The QRMP scheme allows the taxpayers to file GSTR-3B on a quarterly basis but pay tax every monthly. So you have to calculate monthly. Nothing New.
So, majorly following way compliances will be.
| If selected QRMP – Quarterly GST Returns and Monthly Payment System | If remain in Monthly – | |
| System OF RETURN FILLING | Quarterly GSTR1 (M3) With Monthly IFF (optional) (M1,M2) | MONTHLY GSTR1 |
| Quarterly GSTR3B (M3) With Monthly Challan PMT-6 (M1,M2) | Monthly GSTR 3B |
Whatever option you select for 5cr less TO parties, hardly makes difference. IF YOU SELECT MONTHLY then monthly R1 + monthly 3B. IF YOU SELECT QUARTERLY then Quarterly R1 with Monthly IFF & Quarterly 3B With Monthly Challan Who came up with this Messed up idea? Now let’s first understand IFF & problems/ limitations it has.
Disclaimer- Whatever written here is not to criticise but I would like to point out Problems / Limitations that this QRMP SCHEME has in its design. Problems What a professional would have faced for QRMP scheme in Practical life during Jan-Feb 2021.
Invoice Furnishing Facility (IFF)
As you are aware that IFF is Invoice Furnishing Facility (IFF) is an optional facility provided to upload B2B invoices for those quarterly taxpayers who want to pass on input tax credit (ITC) to their recipients (buyers/customers) in first two months of a quarter.
PROBLEMS with IFF ( These are problems as well as limitations of this scheme)
1. Headache of Segregation –
IFF is nothing but GSTR 1 with only B2B & CDNR sheet.( Even You have to file same way GSTR 1 is filled. i.e DSC OR OTP ). In practical life, As a professional, I can say that Clients are sending GSTR 1 monthly only. ( even if you ask IFF. Problem is GSTR -1, which they are sending, has B2C, EXEMPTED, EXPORT data. Because accounting software will not understand IFF & GSTR 1 difference. So it will your job to bifurcate these non-B2B data & remember for 1 or 2 months so as to report in GSTR -1 QUARTERLY filling. Of course, GST software filling solutions will take care of this. But Its cumbersome process. We still have to remember that there is some data to merge in QUARTERLY GSTR -1. If they have gone for full-fledge GSTR 1 then things would have been easy. IFF को “optional GSTR 1” बोल दिया होता और उसमे B2C, export, exempt की module भी होती तो कितना easy हो जाता Quarter end मे. Why they always come with half baked ideas? Here they could have easily provided full-fledge GSTR -1. If so, We don’t have to remember that NON-B2B data is still remaining to add in Quarterly GSTR 1. This half baked Idea of IFF is very frustrating to all professionals. It does not allow B2C and export and Exempted details So We have to remember all this for 2 months and report in QUARTERLY GSTR 1 practically more confusing & time consuming.
2. ITS NOT OPTIONAL in most case-
Since IFF is an optional facility, it poses no additional compliance burden. Yes It is considered optional, but indirectly it has became Monthly Compulsory compliance for many. It is a facility for those quarterly filers who intend to pass ITC to their recipients in first two months of the quarter. But In Majority cases, Where QRMP dealer is issuing a B2B invoices, counter party will hold payment until if this transactions of sales are not showed up in GSTR 2B until 13th after end of month. So, In most of cases, IFF has become Monthly compliance only (with also additional load of segregation of non b2b data). GSTN had No guts to say directly so this is the reason of this scheme to convert all to monthly filing indirectly. Directly they cannot say के सब Monthly हो जाओ, So they brought IFF. Fine.
3. CUT OF DATE OF 13TH ANOTHER PROBLEM –
Of course as a professional, I understand that One has to upload his B2B invoice till 13th then only Counter party can avail ITC. However, I suggest that GSTN could have allowed to file IFF even after 13th of date. Even if Counter party will not get ITC in same month. Because In practical life, If Client has given IFF data late for Jan-2021 month ( i.e after 13TH Feb ) or suppose staff forgot to upload IFF till 13th Feb.,, We as a professional, have to remember these transactions & they will now be reported in next month since IFF screen will not be open after 13th FEB. On other side, GSTR 1 (monthly) is allowed to file even after 11th date. So looking to that, I say that GSTN could have allowed. This could have save Professionals in M2 month from additional burden of remembering what is not filled mistakenly in last month.
4. LIMIT OF 50 LACS – WHY RESTRICT INVOICE based on some random limit?
The total value of invoices that can be uploaded per month is restricted to Rs.50 lakh. This limit is creating huge level of problem that one has never imagined.
> What if dealer has no sales in JAN-2021 and 60 lacs sales in FEB-21. How would he report remaining 10 lacs invoice ? He must wait for march GSTR -1 to report these What if counter party will hold payment for these 10 lacs not showing in his GSTR 2B? Or What if seasonal business and some months are having invoices of value more than 50 lacs ? what to do in those months if such season occurring in first two months of any quarter. ?
> What if one miss chance to file IFF if JAN-21 till 13th and when he upload invoices of Jan+ Feb. in Feb -2021 IFF, It would happen that It might cross 50 lacs. How disheartening he will feel ? This has happened recently. That’s why I am saying that practically it worst kind of innovation of GSTN
> Why GSTN site assumes that Business sale cycle is evenly distributed in year that each month sales would be nearly around 50 lacs ? Why they frame this kind of limit?
Now, Lets understand PMT -6 facility.
PMT–06 challan used for making payment of GST
As we know that Monthly Payment of Taxes in QRMP Scheme can be done in PMT-6 challan. However, It same challan that we used to pay. So as such there is no Compliance. Payment can be made in the first two months by a simple challan in FORM GST PMT-06.
Now let’s discuss Limitations the way idea of PMT-6 & its methods are designed. The flaws in idea of PMT-6
1. WHY EVEN NEED PMT -6 in M1, M2 and a Quarterly GSTR 3B?
GSTR 3B was very smooth. PMT 6 is challan but We still have to compute the way you did GSTR 3B.They should have continued with GSTR 3B for all. Clients will give data same way he used to give data FOR GSTR 3b EARLIER. Same efforts We as professional require to give for PMT-6 also ( If going for Self assessment method). Alternatively, If they really want relaxations for Small dealers. Why can’t bring QUARTELRY 3B without PMT-6 ? As per some report, Small dealers contributes only 7-10% share in Revenue in GST COLLECTIONS So why can’t they bring purely Quarterly 3B without PMT-6?
2. NO SET –OFF IN M1 & M2, CASH LYING in CASH LEDGER –
By the way, nothing is getting set-off. PMT -6 is not even a return. It’s a challan. And Payment made in M1 / M2 will be lying in Cash ledger only. Be it, any method, You used for computation. The cash lying in cash ledger may be not used for payment for any other purpose. However, Still Govt is not getting this cash either. So why PMT-6 needed in M1, M2 ? Why can’t make Quarterly GSTR 3B without this absurd idea of payment of challan in M1, M2. That is why, This PMT6 is useless idea.
3. UNNECESSARY 2 METHODS PROVIDED
In first two months of the quarter, payment of liability can be made by either of the following two methods:
a. Fixed Sum Method: Portal will generate a pre-filled challan in Form GST PMT-06. The system generated pre-filled challan in this case is commonly also known as 35% challan.
b. Self-Assessment Method: The actual tax due is to be paid through challan, in Form GST PMT-06, by considering the tax liability on inward and outward supplies and the input tax credit available for the period as per law.
Different methods of tax calculation will bring more confusion in calculating taxes every month. If fixed sum method is followed for cash payment, there can be scenarios wherein relevant quarter’s cash liability is considerably lesser than the previous quarter’s net cash payment. In such scenarios, excess cash may remain deposited and this will lead to blocking of taxpayer’s working capital. So, Fixed sum will be least choice as it will blocking working capital unnecessarily. I found Fixed sum method is double edge sword, unnecessary of all.
4. INTEREST
In Fixed Sum Method: No interest would be payable which is understood that One is paying on lumsum way.
Self-Assessment Method: Interest amount would be payable as per the provision of Section 50 of the CGST Act for tax or any part thereof (net of ITC) which remains unpaid / paid beyond the due date for the first two months of the quarter. Now, problem is why interest levy in Self – assessment method? I am asking about Intention. Why can’t they give relaxation in this? If they can’t give relaxation then Monthly system & QRMP scheme will have no difference if one is paying under self – assessment method.
5. ALL ITC RESTRICTIONS APPLICABLE IN SELF ASSESSMENT METHOD.
Another problem is that when you compute Challan in Self assessment method for M1 OR M2, You still require to consider GSTR 2B & restrictions of 36(4) still applicable in such case.. Then how come It makes any difference than “Monthly” GSTR 3B scheme? You get my point, Better be in” MONTHLY “ return filling scheme. Again, If they can’t give relaxation in this then Monthly system & QRMP scheme will have no difference if one is paying under self – assessment method.
6. UNANSWERED QUESTION- WHAT IF CHALLAN PAID IN WRONG PATH?
⇒ If a regular taxpayer makes payment through Form GST PMT-06 after selecting the reason “monthly payment for quarterly return” then what is the recourse?
⇒ If a quarterly taxpayer makes payment through Form GST PMT-06 after selecting the reason “any other method” then what is the recourse
7. WHAT IF CREDIT AT THE END OF 3 MONTHS ? WHAT IS PURPOSE OF PMT-6 OF M1 M2?
I explain this point with Case study –
(spare your 2 mins, It will give more insights)
| Jan month M1 Sales 100 ITC 80 Challan paid 20 so Cash balance 20 | Feb. month M2 Sales 100 ITC 75 Challan paid 25 Cash balance 45 | March month M3 Fort March, These are Figures Sales 100 ITC 150 |
| NOW, Quarterly GSTR 3B filling for JAN-MAR – Sales 300 ITC 305 | result ITC balance 5 Cash balance remain 45 | |
As You see above, We paid challan in M1 & M2… (same like “Monthly scheme “). Now, I am having Cash balance at the end of Quarter, which I may be allowed to claim refund. At the end I feel what’s point whole purpose. What is point of whole exercise. ? Again asking, Why can’t bring QUARTERLY 3B without PMT-6 ?
If they have made Quarterly 3B without PMT 6 then there was no payable At All if u see Quarterly 3B.. But reality is different.
8. Why saying Quarterly return ? It all Monthly only. Why wrong promotion?
QRMP is wrongly promoted as LESSER compliance to MSME Rather it is more. In case of MONTHLY Parties, monthly GSTR1 monthly GSTR3b, In case of QUARTERLY parties- Quarterly GSTR1 With Monthly IFF and Quarterly GSTR3B With Monthly Challan ( where same efforts to compute but Hardly name changed. Hats off)
Things would have been very smooth, If they have brought QUARTERLY GSTR 3B without PMT-6 in M1+M2
Then, No above problem would have arise.
Author’s comments –
Actually what has happened to Quarterly dealers – पहले GSTR 3B monthly था + GSTR 1 Quarterly था, अब GSTR 1 monthly हो गया, GSTR 3B Quarterly हो गया with Monthly computation for PMT-6 challan And What has happened with Professionals? Unending headache till quarter end. Merging data of 3 months for GSTR 3B FOR QUARTERLY DEALERS for who earlier given data month wise for PMT -6 and asking Quarterly GSTR 1 where earlier we asked data for only B2B in M1 + M2.
Finally,all will agree that QRMP full form “Quarterly रहेगा पर Monthly परेशानी “
Earlier, People complaint about GSTR 1 / 3B monthly burden of compliances in small dealers.So People asked for QUARTERLY OPTION. So, Govt. introduced QRMP. Now people will beg to bring back GSTR 1 / 3B monthly.
That’s, Marketing strategy by GSTN worked perfectly.
And at last, I would say that
QRMP – Idea is good But half-baked. It is solution first imagined by IT engineers & then come to law. Things getting very difficult in practical life.Better to switch ” Monthly “. It is irritating cycle of 3 months. & QRMP will frustrate all the Tax Professionals and Tax Payers to such an extent that you ultimately convert to Monthly filing.
70% of people, I asked before January, They converted all Taxpayers in Monthly looking to PMT6 & IFF difficulties, & half baked solution QRMP. Now Even rest 30% saying that they will convert ALL clients to” Monthly” from APR 21.
Author Bio
My issue is Qrmp returns for one client Feb 45 invoices uploaded in GSTR1 but its not yet in filed status by portal. GSTR1 IFF.. so answerable to all clients. whats the solution. mar 21 returns filed.. what to do. its coming us expired… Whether to reset the GSTR1?
Headache is for people who use their heads.
This government has NO head.
And the HEAD of government has NO brains.
He thinks that ALL BUSINESSMEN are frauds.
Can’t help. I have almost given up my practice.
I would prefer to take a job of sweeper in D MART for better peace of mind.
Good one Sir!
Is there any option how to show Invoices if in Jan-Feb Turnover is more than 50 Lakhs & most probably March turnover will also exceed 50 lakhs? By default it’s selected for QRMP.
Business Law maker dont know about business.They just making laws for difficulty for Business.Every Time new modification with new tension.First a fall they have to teach department about law and than they should apply on public. QRMP they put parties above 10 cr Turnover to this scheme.they can’t imgine about problem to file GSTR1
Our Feb 21 turnover above Rs.50 lacs,we had to carry forward excess amount for next month and our turnover will again be above 50 lacs in march.
This is funny provision. Must be removed immediately
Article – quite worthy. I was not aware of this 50 lakhs threshold limit. I filed return thrice but it was not getting submitted. I googled, I got your article. My sales this month is 75 Lakhs. Getting frustrated. If I ignore any of the parties, they will not get ITC benefit and this will definitely affect my business. In real sense, department is ruining our business. They don’t know the real essence of business.
First a great WoW to the Author to come out with such a daring opinion. It is our fate to bare the headache as long as the head less people are administering the rules.
I am into 100% B2B busineas. Is there any link or process on GST portal where I can change my IFF option to the old one (monthly).
May sale is more then the IFF restrictions of 50 lakhs but I am unable to file GSTR1 due to this IFF threshold, and as a result my clients may not avail ITC. Please advise.
But now the portal is accepting figures above 50 lacs so it’s a significant change made by it .But they have not mentioned anything in law about 50 lacs .They have changed but did’t amend the law regarding monthly cap
ICAI or its office bearers will never raise a finger against Government. if you ask them they are act of parliament. no one in the council has the guts to call a spade is a spade.
QRMP must be stopped immediately. When GSTR9 C abolished by govt , ICAI president ans team run to Modi and Sitaram to reinstate the same just because of loss of their fee only . Why does ICAI team do not run to Modi/FM to resolve the problems sited above.
First of all, GST Act was introduced. A few forms were made part of the Rules therein. The GSTN failed in framing a workable, digital forms. So they dropped certain forms or changed certain forms or introduced new forms. Then they put the Rules and circulars into cold storage. Again, in order to move with the forms available, they changed the Rules. When these Rules were challenged before the Courts, they amended the laws. In essence, the body is being modified to suit the shirt. What a pity?
this is nothing but greed of the officials and the government. added to this the arrogance of the officialdom.
Agree with all the points mentioned here. First look at the rules for this new scheme and it was clear that this will only be an additional headache. And that’s what it is. FM doesn’t know anything, and the babus working under her are either stupid or plain evil.
i advised my clients to go for monthly instead of Quarterly to avoid this head ache.
DEAR CA HASHIL -ARTICLE BY U
QRMP- A headache we never asked-MANY THKS
GOD BLESS U FOR YR EFFORTS IN PENNING DOWN PAINS -PROBLEMS CREATED
PERSONS APPORVING THIS QRMP ARE CARONA INFECTED SO NEED IMMEDIATE VACCINE-GST IS CALLED-GOOD-SIMPLE-TAX -WE SAY GST LAW GOING BAD TO WORSE
Seriously, GSTN wants to pacify taxpayers, but end up in creating more mess. policymakers are not aware of ground realities
In our mother Telugu there is a saying that “komati lekkalu” which means a businessman (traditionally vysyas in olden days who were alone capable of doing business). They used to count every anna, kassu, paise (was not in existence in those primitive days) in their business. Like this present system of tax collection is progressing. For instance, one may find that GSTIN portal is having paise column though Sec.170 mandates to round off tax to nearest rupee. What the hell GSTIN is doing in their programming by absolute deviating from the law? Are they penalised for contravention of the provisions of law?
What you have written is true nut we have to start living in reality, the country which is divided on religion and the GOI people who are least bothered about small business. NOTE: if protest will be too much we will be also termed parasites.
One thing every Indian should understand in RAMARAJYA there is only one king and all rest are PRAJA and praja can be dealt in any manner they should learn to abide.
IT SEEMS THAT GOVT/ DEPT WANT PEOPLE TO CHOOSE MONTHLY RETURNS THEMSELVES. THAT’S WHY THEY ARE TRYING SUCH HARASSMENTS
Well said. QRMP is a useless thing. The worst part is Department is sending notices in 3A for QRMP dealers for not filing monthly GSTR-3B.
Dear sir
1) i respect ur insights, But government alway want to bring more n more people to comply.
2) It is basically more useful for those small businesses which are B to C.
3) Even in composition scheme , on the face it seems very less compliance burden for small businesses but those who are dealing in B to B it (composition scheme) is not beneficial as receiver will not get ITC benefit , hence he will be discouraged from doing business with composition dealer.
4) your point of small businesses contributing only 7-10% and hence, quarterly payment is welcome but still when they are dealing with B to B due to IFF it seems to be of little use as far as business is concerned.
5) For me when i look at larger view i see that in a year or two it seems, government is looking at monthly payment (3B) and quarterly return (GSTR1) for all businesses just like in TDS. i feel these are just Baby steps in that direction.
i personally feel it is mainly useful for Businesses which cater to B to C and not B to B.
The example for March is an exaggerated one. If itc is 75 only then what will happen to your calculations and observations? In business such adverse circumstances may occur. But that is not the end of all. Your attempt to portray QRMP as a bad scheme appears to be overzealous. Nothing prevents the assessee to opt out the QRMP and stick to the old system, if it is found to be convenient.
QRMP Scheme is worst.It is advisable to opt GSTR1 on 20 th in every month and GSTR 3B on 25th or 30 th. In this way all the dealers can file the return in time
Best line of Article is “Whatever written here is not to criticise”, is it the fear from Government?
Every thing is a problem sir. Dont do business . There will be no problem
Good article Sir!