Quarterly Return & Monthly Payment (QRMP) Scheme

Quarterly Return & Monthly Payment (QRMP) Scheme

The QRMP stands for Quarterly Return & Monthly Payment. The GST council meeting held on 5th Oct in which decided to give benefits to small taxpayers . After that meeting this scheme came into effect from 1st Jan 2021 to give benefits to small taxpayers whose turnover is upto 5 crores. Under this scheme taxpayers requires to pay their tax liability on a monthly basis and need to file their returns on a quarterly basis.

Under this scheme, taxpayers are not required to wait so far to get their ITC (Input Tax Credit) because under this scheme they can claim ITC on monthly basis if they wish to do so.

1. Who is eligible for QRMP Scheme?

a) All taxpayers whose aggregate annual turnover (AATO) is up to Rs. 5 Crore in the preceding financial year is eligible for QRMP scheme.

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

      • Registered taxpayer (Normal taxpayer, SEZ Developer, SEZ unit)

      • Taxpayers who have opted out of composition scheme

      • Persons applying for a fresh registration as Normal taxpayer

Note: The scheme is not available for taxpayers whose Annual aggregate turnover (AATO) is more than ₹ 5 Crores.

2. What is IFF? Who can use it?

The Central Board of Indirect Taxes & Customs (CBIC) had notified the Invoice Furnishing Facility on 10.11.2020 via notification number 82 /2020-Central Tax.

The taxpayers who are opting QRMP scheme can avail the benefit of Invoice Furnishing Facility (IFF) to upload invoices on monthly basis. The Invoice Furnishing Facility (IFF) is a facility where quarterly GSTR-1 filers can choose to upload their invoices every month.

Small taxpayers having  aggregate turnover less than Rs. 1.5 Crore who file their GSTR–1 on quarterly basis can use IFF Facility.

Significant points regarding IFF: -

  • You can use the IFF facility only for the first two months of the quarter.
  • The invoices relating to the last month of the quarter needs to be uploaded in the GSTR-1 return only.
  • You are not required to upload invoices in GSTR-1 if the same has been uploaded in the IFF.
  • The total value of invoices that can be uploaded is restricted to Rs.50 lakh     per month.
  • 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.

The following details are to be submitted by the small taxpayers if they opt for Invoice Furnishing Facility:

  • B2B invoice details of sale transactions (both inter-state and intra-state).
  • Debit and credit notes of the B2B invoices issued during the month.

3. From where can I opt in or opt out from the QRMP scheme?

· You can opt out (exit) from the GST portal GST.GOV.IN > Services > Returns > Opt-in for Quarterly Return option to opt in or opt out of the QRMP scheme.

4. What are the pre-conditions to opt for QRMP scheme?

Following pre-conditions must be fulfilled by a taxpayer to opt for QRMP scheme:

• Taxpayer must be registered as a regular taxpayer or opted out of composition scheme

• Taxpayer must have a valid User ID and password

• The Annual aggregate turnover (AATO) in current and preceding FY (if applicable) is up to ₹5 Cr.

• The Form GSTR-3B return for 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. period for which you are opting for QRMP scheme).

5. When can a Taxpayer opt out the QRMP Scheme?

Taxpayer can opt in or opt out of the QRMP scheme any time during the year as per the timelines mentioned in the table given below:

Sr. No. Quarter of a particular year QRMP Scheme can be opt in or opt out during
1. Q1 (April – May – June) 1st February’ to 30th April’
2. Q2 (July – August – September) 1st May’ to 31st July’
3. Q3 (October – November – December) 1st August’ to 31st October’
4. Q4 (January – February – March) 1st November’ to 31st January of next year

6. Which Form to choose?

The taxpayer has to deposit the tax amount using Form GST PMT 06.

7. Date of Payment of Taxes?

The taxpayer must deposit tax by 25thof the following month, for the first and second month of the quarter.

The taxpayers can pay tax liability using any of the following method.

1. Fixed Sum Method (FSM)

The taxpayer must pay an amount of tax mentioned in a pre-filled   challan in the Form GST PMT-06for an amount equal to 35% of the tax paid in cash.

Sr No. Type of Taxpayer Tax to be paid
1. Who furnished GSTR-3B quarterly for the last quarter 35% of tax paid in cash in the preceding quarter
2. Who furnished GSTR-3B monthly during the last quarter 100% of tax paid in cash in the last month of the immediately preceding quarter

2. Self Assessment Method (SAM)

It is traditional method where a taxpayer can pay tax liability by considering the tax liability on outward and inward supplies and input tax credit is available.

                  Case 1- GSTR – 3B filed on quarterly basis

   
Tax   paid in cash during Jan’21 - Mar’21 quarter   
   
Tax required to be paid in each of Apr’21 and   May’21   
   
CGST   
   
1,00,000   
   
CGST   
   
35,000   
   
SGST   
   
1,00,000   
   
SGST   
   
35,000   
   
IGST   
   
2,00,000   
   
IGST   
   
70,000   
   
Cess   
   
30,000   
   
Cess   
   
10,500   

                   Case 2- GSTR – 3B filed on monthly basis

   
Tax   paid in cash during Mar’21   
   
Tax required to be paid in each of Apr’21 and   May’21   
   
CGST   
   
5,000   
   
CGST   
   
5,000   
   
SGST   
   
5,000   
   
SGST   
   
5,000   
   
IGST   
   
10,000   
   
IGST   
   
10,000   
   
Cess   
   
2,000   
   
Cess   
   
2,000   

  8. Due Date of GSTR-3B under QRMP Scheme

9. Interest under QRMP scheme

Under Fixed Sum Method (FSM):

Sr No.ScenarioInterest to be Paid
1   
Tax liability mentioned in pre-filled form GST PMT-06 is paid by 25th of the following month   
   
Nil   
2   
Tax liability mentioned in pre-filled form GST PMT-06 is not paid by 25th of the following month   
   
18% of the tax liability
   
(from 26th of the following month   till the date of payment)
   
   
3   
The final tax liability for the first two months is less than or equal to the   amount paid through pre-filled form GST PMT-06   
   
Nil   
4   
The final tax liability for the first two months is higher than the tax   amount paid through pre-filled form GST PMT-06, and such excess liability has been paid within quarterly   GSTR-3B due date   
   
Nil   
5   
The final tax liability for the first two months is higher than the tax   amount paid through pre-filled form GST PMT-06, and such excess liability has not been paid   within quarterly GSTR-3B due date   
   
18% of the tax liability
   
(from GSTR-3B due date* till the   date of payment)
   
   

Under Self-Assessment Method (SAM):

The taxpayer has to pay interest @ 18% on the net tax liability which remains unpaid or paid beyond the due date for the first two months of the quarter.

10. Late Fee under QRMP scheme

If GSTR – 3B is not filled with due date, then following late fee should be applicable subject to maximum of Rs. 5000.

   
Name of   the Act   
   
Late fee for every
   
day of delay   
   
Late fee for every
   
day of delay
   
(in case of ‘Nil’
   
tax liability)   
   
CGST Act   
   
Rs.25   
   
Rs.10   
   
SGST Act   
   
Rs.25   
   
Rs.10   
   
IGST Act   
   
Rs.50   
   
Rs.20   

11. Advantages & Disadvantages of QRMP

Before opting in or opting out from QRMP make sure that you are aware about the benefits and drawbacks of QRMP

Checkout the advantages of QRMP given below;

· The compliance burden is way more lesser than a normal taxpayer.

· Under this scheme, taxpayer required to file GSTR-3B returns four times only in the entire year (earlier was required to file 12 times a year) since IFF (Invoice Furnishing Facility) is provided under this scheme.

· Also taxpayer is required to file GSTR-1 only four times a year since IFF facility is available.

· Easy & Simple procedure:

The taxpayer can opt in or opt out very easily from QRMP scheme.

The below easy procedure requires to be filed;

Login > Services > opt in or opt out for quarterly return.

· There is no late fee for delayed payment of tax for any of the first two months.

· This scheme can be opted for different frequencies in different states.

       For example, if a taxpayer has multiple GSTINs on the same PAN in different States, they can opt in for different frequencies (monthly or quarterly) in different States

Checkout the disadvantages given below;

· This scheme is not available for all types of taxpayers. The benefit of this scheme is given to small taxpayer only. The taxpayers whose aggregate turnover is below Rs 5 crore, they can only opt this scheme.

· Under this scheme, taxpayers may be liable to pay a higher amount of taxes if they had paid high amount of tax in the previous month.

· Cash deposited in the first month against your liability for the first month cannot be considered for balance for your electronic cash ledger for the second month. The action to be taken in the second month should be considered based on the balance in cash ledger after the deposit made for the first month.

· One cannot utilize amount deposited in month M1 and M2 for any other purpose, before filing FORM GSTR-3B for the quarter in which such deposits have been made. After filing FORM GSTR-3B, such cash may be used for other purposes also.

Conclusion

The Quarterly Report & Monthly Payment (QRMP) scheme is available only to small taxpayers. The taxpayers are only required to file there returns on a quarterly basis. Though they have to pay tax on a monthly basis only.

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