Taking another step towards the goal of increasing “Ease of doing business” in India and providing relief to small taxpayers; the GST Council in their 42nd Meet on 5th October 2020 proposed a quarterly return filing system for small taxpayers to be implemented w.e.f. 1st January, 2021. QRMP or Quarterly Return Monthly Payment Scheme is an optional scheme that CBIC has rolled out for small scale businesses having aggregate turnover up to 5 crore rupees to furnish return on a quarterly basis along with monthly payment of tax. Thus, the small taxpayers would only need to file 8 returns (4 GSTR 1 and 4 GSTR 3B) in a year as compared to 16 returns a year at present.
This scheme would bring in a big relief to those taxpayers who may have been losing their eligible credits due to compliance of Rule 36(4) where their suppliers are filing GSTR 1 quarterly. Now, with the introduction of QRMP scheme, Invoice Furnishing Facility (IFF) will help the taxpayers to opt for quarterly filing of returns (GSTR-1 as well as GSTR-3B) and simultaneously upload the invoices on a monthly basis which will be duly reflected in the GSTR-2A and GSTR-2B of the customer based on which the customer can avail the input tax credit timely.
The CBIC on 10th of November, 2020 issued following in respect of QRMP scheme:
|1||Notification No. 81/2020-Central Tax, dated 10-11-2020||Notifies amendment carried out in sub-section (1), (2) and (7) of section 39 of the CGST Act vide Finance (No.2) Act, 2019.|
|2||Notification No. 82/2020-Central Tax, dated 10-11-2020||Makes the Thirteenth amendment (2020) to the CGST Rules 2017.|
|3||Notification No. 84/2020-Central Tax, dated 10-11-2020||Notifies class of persons under proviso to section 39(1) of the CGST Act.|
|4||Notification No. 85/2020-Central Tax, dated 10-11-2020||Notifies special procedure for making payment of tax liability in the first two months of a quarter.|
|5||Circular No. 143/13/2020-GST dated 10.11.2020||Explain the scheme in simple terms.|
|ü A registered person who is required to furnish a return in FORM GSTR-3B, and who has an aggregate turnover of up to Rs. 5 crores in the preceding financial year
ü Any person obtaining a new registration or opting out of the Composition Scheme can also opt for this Scheme.
|ü Return for the preceding month as on the date of exercising option has to be furnished
ü Once option is exercised, it will continue to remain until it is changed, or the taxpayer becomes ineligible.
Note: The RPs opting for the scheme can avail the facility of Invoice Furnishing Facility (IFF), so
that the outward supplies to registered person are reflected in their respective Form GSTR 2A & 2B.
|Timeline for exercising option under QRMP Scheme during FY 2020-21|
|Sl. No.||Period – Quarter||Timeline|
|1||April – June||1st Feb 2021 to 30th April 2021|
|2||July – Sept||1st May 2021 to 31st July 2021|
|3||Oct – Dec||1st August 2021 to 31st Oct 2021|
|4||Jan – March||1st Nov 2021 to 31st Jan 2022|
In order to facilitate the taxpayers, it has been decided that for the first quarter i.e., January 2021 to March 2021, the registered persons having turnover up to Rs 5 cr and who have furnished the return in FORM GSTR-3B for October 2020 by 30th November 2020, shall be migrated on the common portal as indicated below:
|S. No.||Class of registered person having aggregate turnover||Default Option|
|(a)||Up to 1.5 crore rupees & furnished FORM GSTR-1 on monthly basis in the current financial year||Monthly Return|
|(b)||Up to 1.5 crore rupees & furnished FORM GSTR-1 on a quarterly basis in the current financial year||Quarterly Return|
|(c)||More than 1.5 crore rupees and up to 5 crore rupees in the preceding financial year||Quarterly Return|
Methods of Monthly Payment of Taxes
|Fixed Sum Method||Self-Assessment Method|
|ü A pre-filled challan facility in PMT-06 either 35% (if quarterly return had been filed in previous quarter) and 100% of previous month (if monthly return has been filed for the previous quarter).
ü Filing of up-to date tax returns is mandatory for using this fixed sum method.
ü Not available if return for a complete tax period is not filed.
|ü Manual computation of taxes to be paid in cash.
ü Tax liability = Liability on outward supplies plus RCM on Inward supplies minus Eligible ITC.
ü If cash balance is available in Electronic Cash Ledger and utilizable, then only balance deposit would be sufficient.
Under Fixed Sum Method:
|Tax due in 1st month||PMT-06 filed on 25th||Tax due for 2nd month||PMT-06 filed on 25th||Total liability in the quarter (net of available ITC)||Diffe-rence [5-(3+1)]||GSTR-3B filed on due date||Interest Payable?||Remarks|
|35||NO||35||YES||150||80||YES||YES||Interest payable on 35 for no. of days delay in filing 1st month PMT-06|
|35||YES||35||NO||150||80||YES||YES||Interest payable on 35 for no. of days delay in filing 2nd month PMT-06|
|35||YES||35||YES||150||80||NO||YES||Interest payable on 80 for no. of days delay in filing 3B|
|35||NO||35||NO||150||80||NO||YES||Interest to be calculated separately for no. of days delay in 1st month PMT-06, 2nd month PMT-06 and for GSTR 3B|
Under Self-Assessment Method:
|Return filing due dates w.e.f 1st Jan 2021|
|Category of Taxpayers||GSTR-1||Invoice Filing Facility||PMT- 06 for M 1||PMT-06 for M 2||GSTR-3B|
|Taxpayers who are required to file monthly returns:
(whose ATO TO is more than 5 Cr. Or who have not opted from QRMP Scheme)
|11th of the following month||NA||NA||NA||20th of the following month|
|Taxpayers who have opted for QRMP Scheme||13th day of the month following the quarter||1st to 13th day in M 1 and M 2||25th day of the month following M 1||25th day of the month following M 2||22nd or 24th day of the month following the quarter|
This scheme is a welcoming move that will provide more flexibility in compliance for small taxpayers. Further, this may prove to be a blessing for not only the small taxpayers but also for large players who are currently losing credits due to non-reflection of entries in GSTR 2A since many suppliers are filing GSTR 1 quarterly, thus eventually leading to savings in both time and money. Also, from the government’s perspective, this is scheme is expected to plug revenue leakages and frauds as it could turn out to be a significant tool to curb the ongoing menace of fake invoicing vis-a-vis fake credits. Therefore, it seems that everybody would be in a win-win situation after the successful implementation of the QRMP scheme.
Ans: The facility to avail the Scheme on the common portal would be available throughout the year. A registered person can opt in for any quarter from first day of second month of preceding quarter to the last day of the first month of the quarter. For example, registered person intending to avail of the Scheme for the quarter ‘July to September’ can exercise this option during 1st of May to 31st of July. However, registered persons are not required to exercise the option every quarter.
Ans: Yes, the option to avail the QRMP Scheme is GSTIN wise (some GSTINs for a PAN can opt for the QRMP Scheme and remaining GSTINs may not opt for the Scheme) and once it is exercised it would be valid for future tax periods.
Ans: The registered persons opting for the Scheme would be required to furnish the details of outward supply in Form GSTR-1 on quarterly basis. Invoice furnishing facility (‘IFF’) has been introduced in respect of reporting the invoice for details of supply made to registered persons for the first two months of the quarter. The supplier can upload these invoices on monthly basis. Notably, the taxpayer can upload maximum of Rs 50 Lakhs invoices in each of the two months of quarter. The IFF facility is optional. The details of invoices furnished under this facility in the first two months are not required to be furnished again in Form GSTR-1.
Ans: To avail the benefit of this scheme, it has been clarified that all the registered persons, whose aggregate turnover for the FY 2019-20 is up to Rs 5 crore and who have furnished the return in Form GSTR-3B for the month of October 2020 by 30th November 2020, shall be automatically migrated on the common portal.
Ans: The registered person under the QRMP Scheme would be required to pay the tax due in each of the first two months of the quarter by depositing the due amount in Form GST PMT-06 and the amount of tax shall be deposited by the 25th day of next month.
Ans: The registered persons opting for the QRPM Scheme would be required to furnish Form GSTR-3B, for each quarter, on or before 22nd or 24th day of the month succeeding such quarter for Class A States and Class B States respectively.
Ans: The facility for opting out of the Scheme for a quarter will be available from first day of second month of preceding quarter to the last day of the first month of the quarter. It is also clarified that such registered person, whose aggregate turnover crosses 5 crore rupees during a quarter in current financial year, shall opt for furnishing of return on monthly basis from the succeeding quarter.
The article is written by CA Mannu Kashliwal, Anand Sharma and Bichitra Bijoy Bhattacharjee. Special thanks to CA Ashish Chaudhary for vetting the article. Please provide your feedback or views to the writer at [email protected]