Quarterly Return with Monthly Payments (QRMP) Scheme: Eligibility, Returns & Payment

Introduction:

The QRMP Scheme is the option given under the GST Act to small tax payers by The Central Board of Indirect Taxes and Customs (CBIC) to reduce the burden of compliance. This initiative is taken as part of the ease of doing business. Under this scheme, eligible Tax payer are allowed to file GSTR 3B and GSTR 1 returns on a quarterly basis and pay tax on a monthly basis.

Eligibility:

All the tax payers whose Aggregate Annual Turnover (PAN based) is up to Rs 5 crore in the current financial year and the preceding financial year (if applicable) and have already filed their last due Form GSTR 3B return are eligible to opt for the QRMP Scheme.

For eg : If your aggregate turnover (PAN based) for FY 2019-20 and the current financial year is up to Rs 5 crore and you have filed your Form GSTR-3B for the month of October 2020 (let’s say at least) by 30th November 2020, you will be assigned to the QRMP scheme by the GST system.

The QRMP scheme can be availed of only by those taxpayers who are liable to file Form GSTR-1 and Form GSTR-3B returns and can be opted for by :

• Registered taxpayer (Normal taxpayer, SEZ Developer, SEZ unit)
• Taxpayers who have opted out of the composition scheme
• Persons applying for a fresh registration as a Normal taxpayer

Note:

• The scheme is not available for taxpayers whose Annual Aggregate Turnover (AATO) is more than Rs 5 crore.
• If the AATO exceeds Rs 5 crore during any quarter of the current financial year, then the taxpayer becomes ineligible for the scheme from the next quarter.
• The registered taxpayer can opt in or out of the scheme at any time during the year without any restrictions.

Pre-Conditions For Opting QRMP Scheme:

The following pre-conditions must be fulfilled by a taxpayer to opt for the QRMP scheme :

• A Taxpayer must be registered as a regular taxpayer or opted out of composition scheme.
• A Taxpayer must have a valid User ID and password.
• The Annual Aggregate Turnover (AATO) in current and preceding FY (if applicable) is up to Rs 5 Cr.
• The Form GSTR-3B return for the most recent tax period has been filed.
• There is no data saved on the portal in Form GSTR-1 for the applicable period (i.e., the period for which you are opting for the QRMP scheme).

Obtaining QRMP scheme:

A registered taxpayer (RTP) can opt for the scheme at any time during the financial year. A Registered Taxpayer who intends to opt for the scheme has to indicate the same on the GST common portal from the 1^st of the second month of the preceding quarter until the last day of the first month of the quarter for which such an option RTP is willing to exercise.

RTP can opt in or opt out of the QRMP scheme as per the timelines mentioned in the table below:

Sr No	Quarter of a particular year	QRMP scheme can be opt in/ opt out during
1	Q1 ( Apr – May – June )	1st February to 30th April
2	Q2 ( Jul – Aug – Sep )	1ST May to 31st July
3	Q3 (Oct – Nov – Dec )	1st August to 31st October
4	Q4 ( Jan – Feb – Mar )	1st November to 31st January of Next year

• If RTP is newly registered, then he can opt for the scheme under the following conditions :

1. If the registration is granted on any date during the first month of a quarter, then he will be able to opt for the QRMP scheme from the beginning itself.

For example, a person granted registration up to 31st January, 2021, he will be able to opt for the QRMP Scheme from the quarter Jan-Mar, 2021 itself by 31st January, 2021.

2. If, however, the registration is granted on any of the dates during the later two months of a quarter, they will be able to opt for the QRMP scheme only from the next quarter onwards.

For example, a person granted registration on or after 1st February, 2021, he will be able to opt for the QRMP Scheme only from Quarter Apr-June, 2021 onwards and will have to file Form GSTR-1 and Form GSTR-3B returns monthly for the months of February and March, 2021.

• RTP is not required to exercise the option every quarter. Once the option has been exercised, it will continue as per the selected option for future tax periods, unless RTP revises the option or AATO exceeds Rs 5 crore.
• If RTP has multiple GSTIN on the same PAN in the same or different states, then RTP has the option to opt for the QRMP scheme for a few GSTIN and not opt for the scheme in the case of a remaining GSTIN.

Furnishing of Details of Outward Supply:

• The RTP who have opted for the QRMP scheme can use the IFF facility (Invoice Furnishing Facility) to upload their invoices on GST portal on a monthly basis.
• IFF is used to declare outward supplies to registered persons for first two months of the quarter.
• The invoices related to the last month of the quarter should be declared in GSTR 1 only. There is no need to upload invoices declared under IFF in GSTR 1 again.
• This facility is similar to GSTR 1.
• It allows the filing of only B2B invoices, credit notes, and debit notes.
• The details submitted in IFF will be reflected in the GSTR 2A, GSTR 2B, GSTR 4A, or GSTR 6A of the recipients, as the case may be.
• This will allow recipient taxpayers to take credit for these invoices in the same month, if reported in IFF, by the supplier taxpayer under the QRMP scheme.
• IFF should be filed on or before the 13^th day of the next month.
• IFF is an optional facility. The RTP, at his option, may choose to submit details of outward supply made during the quarter in the quarterly GSTR 1 only, without using IFF.

Payment of Taxes:

 The RTP, who have opted for QRMP scheme, have to pay monthly tax on or before the 25^th of the succeeding month for the first two months of a quarter. The payment needs to be made using GST PMT 06 challan.

There are two methods for payment of taxes on a monthly basis, which are as follows :

1. Fixed Sum Method : Under this method, RTP must pay the amount of tax mentioned in the pre-filled challan generated by the GST portal in the form GST PMT 06 for an amount equal to 35% of the tax paid in cash in the preceding quarter where the return was furnished quarterly or equal to the tax paid in cash in the last month of the immediately preceding quarter where the return was furnished monthly.

Eg 1 : If GSTR 3B for Jan 2022 to March 2023 was filed on a quarterly basis :

Tax paid in cash during Jan 22 to Mar 23 quarter		Tax required to be paid in April 23 and May 23
IGST	10,000	IGST	3,500
CGST	5,000	CGST	1,750
SGST	5,000	SGST	1,750

Eg 2 : If GSTR 3B for Jan 2022 to March 2023 was filed on a monthly basis :

Tax paid in cash in the month of  Mar 23		Tax required to be paid in April 23 and May 23
IGST	10,000	IGST	10,000
CGST	5,000	CGST	5,000
SGST	5,000	SGST	5,000

2. Self – Assessment Method : Under this method, RTP needs to pay tax on his actual tax liability after adjusting the ITC available to him in GSTR 2B and the balance in electronic cash or electronic credit ledger. If the balance in the electronic cash or electronic credit ledger is sufficient to discharge the cumulative tax liability of the first and second months of the quarter, or where the tax liability is NIL, RTP may not deposit any amount using a challan. Under this method, RTP has to generate a challan on the GST portal and then pay tax.

It is to be noted that a registered person will not be eligible for the said procedures unless he has furnished the return for the complete tax period preceding such month. A complete tax period is one where the person is registered from the first until the last day of the tax period.

The RTP may use any of the above methods for payment of taxes at his own discretion for the first two months of a quarter.

Filing of GSTR 3B:

If RTP has exercised the QRMP option, he will have to file GSTR 3B on a quarterly basis. The due date for the same is on or before the 22^nd or 24^th day of the month succeeding such quarter. 22^nd or 24^th depends on the state in which he has taken GST registration.

There is no procedural difference in filing GSTR 3B and claiming ITC under the monthly method and quarterly method.

The RTP has to declare all the supplies made during the quarter, ITC claimed during the quarter, payment of taxes, etc in the quarterly GSTR 3B.

Interest:

• If RTP has opted for the Fixed Sum Method :

For the first two months, if the liability mentioned in the prefilled PMT 06 challan is not paid on or before the 25^th day of the succeeding month, then 18% interest will be levied from the due date of payment till the date of actual payment.

• If RTP has opted for the Self- Assessment Method :

For the first two months, if the tax payable (net of ITC) remains unpaid till the due date of payment, then 18% interest will be levied from the due date of payment till the date of actual payment.

In both methods, if the final tax liability in the third month is not paid on or before the due date of filing of GSTR 3B then 18% interest will be levied from the due date of payment till the date of actual payment.

Late Fees:

Late fees for delay in filing of return is as follows :

Name of the Act	Late fees per day
	Other than Nil tax	Nil Tax
IGST	Rs. 50	Rs. 20
CGST	Rs. 25	Rs. 10
SGST	Rs. 25	Rs. 10

* Maximum late fees will be limited to Rs. 5,000/-.

* Late fees are not applicable for delay in payment of PMT 06 for the first two months.

Conclusion:

Understanding the benefits of the QRMP scheme is very important for all small businesses. It reduces the frequency of filing returns and provides flexibility in tax payment, which in turn provides ease in doing business.