- QRMP Scheme: Introduction
- Eligibility for the Scheme:
- How can you use the QRMP Scheme option?
- Invoice Furnishing Facility (IFF): Meaning
- GSTR-3B filing is considered monthly/quarterly.
- Submit details of outward supplies
- Make monthly tax payments under the QRMP scheme
- Fixed Sum Method
- SAM (Self-Assessment Method):
- Steps to Making Tax Payments Under the QRMP Scheme
- QRMP Scheme Access Time Limit
- Due Dates For Payments in the QRMP Scheme
- Late Fees and Their Applicability
Under the Goods and Services Tax (GST), the Central Board of Indirect Taxes and Customs (CBIC) implemented the Quarterly Return Filing and Monthly Payment of Taxes (QRMP) scheme to assist small taxpayers with a turnover of less than Rs.5 crores. The QRMP scheme requires taxpayers to file GSTR-3B quarterly and pay tax on a monthly basis.
QRMP Scheme: Introduction
The QRMP scheme is open to registered taxpayers with an annual turnover of up to Rs.5 crore in the previous financial year. This arrangement requires taxpayers to file the GSTR-3B quarterly while paying their taxes annually. As a result, instead of 16 returns per year, small taxpayers can now file just eight returns per year, i.e. four GSTR-1 returns and four GSTR-3B returns. Even though the GSTR-1 is to be filed quarterly, taxpayers can use the Invoice Furnishing Facility (IFF) under the QRMP scheme to upload their supply invoices monthly on the GSTN. These invoices would appear on their customers’ GSTR-2A and GSTR-2B tax returns, enabling them to demand input tax credits (ITC). These invoices would appear on their customers’ GSTR-2A and GSTR-2B forms, allowing them to claim input tax credits (ITC) on a timely basis. This means that their customers do not miss out on credits for qualifying inputs.
Eligibility for the Scheme:
- The QRMP Scheme is open to any registered person who is required to file a return in FORM GSTR-3B and has an aggregate turnover of up to 5 crore rupees in the previous financial year.
- The total annual turnover for the previous financial year will be measured in the popular portal using the information provided in the taxpayer’s returns for the tax periods in the previous financial year.
- If the registered person’s total turnover exceeds 5 crore rupees in any quarter of the current financial year, he or she will be ineligible for the Scheme from the following quarter.
How can you use the QRMP Scheme option?
- A registered person who intends to enter his or her quarterly GSTR-3B monthly must indicate the same on the GST website, from the 1st of the 2nd month of the previous quarter until the last day of the first month of the first quarter of that term.
For example, if A wants to file a quarterly return for the January-March 2021 quarter, he or she must choose to file a quarterly return for the usual GST quarter between November 1 and January 31.
Once a registrant has opted for a quarterly file, he or she will need to continue to submit his / her quarterly return for all future tax periods, except in the following cases:
- If a taxpayer does not qualify for a quarterly return (for example, if the combined profit exceeds $ 5 million per quarter, then from the next quarter he or she will not be able to file quarterly tax returns). If the taxpayer agrees to provide GSTR-3B on a monthly basis.
- A registrant will not be eligible to submit quarterly tax returns if the final refund, which was due on the date of application, has not been granted.
Example: If a person chooses to file a quarterly GSTR-3B file on December 1, 2020, he or she will be required to submit his or her GSTR-3B return in October 2020, which would be a final refund due to the use of the quarterly input option.
Invoice Furnishing Facility (IFF): Meaning
The Invoice Furnishing Facility (IFF) is a voluntary service given under Rule 59(2) of the CGST Law, 2017. It does not enforce any special compliance conditions.
- This is for quarterly taxpayers who wish to pass on their ITC in the first two months of the year to their beneficiaries (buyers/customers).
- The taxpayer must request descriptions of inter-state and intra-state B2B invoice transactions, as well as debit and credit notes for B2B invoices issued during the month.
- Per month, the total net amount of invoices that can be uploaded is limited to Rs.50 lakh.
- The information sent in IFF will appear on the recipients’ GSTR-2A, GSTR-2B, GSTR-4A, or GSTR-6A, depending on the situation.
- The IFF for a month will expire on the 13th of the following month, and it will not be possible to file it after that date.
GSTR-3B filing is considered monthly/quarterly.
To select the quarterly GSTR-3B, the taxpayer must obey the measures outlined above. However, in the case of GSTN registered persons who fall into the categories mentioned below and who have filed their GSTR-3B return for October 2020 by November 30, 2020, it will be assumed that they have chosen monthly or quarterly filing as detailed below.
|S No.||Persons That Have Been Registered||Deemed Option|
|1||Individuals who have filed Form GSTR-1 quarterly in the current financial year and have an aggregate turnover of up to Rs.1.5 crore||GSTR-3B is issued on a quarterly basis.|
|2||All who have filed Form GSTR-1 monthly in the current financial year and have a total turnover of up to Rs.1.5 crore.||GSTR-3B (Monthly)|
|3||Persons with an annual turnover of more than Rs.1.5 crore but less than Rs.5 crore in the previous financial year are registered.||GSTR-3B is issued on a quarterly basis.|
Between the 5th of December 2020 and the 31st of January 2021, taxpayers referred to in Sl. No. 2 of the above table can adjust the default option and opt for quarterly GSTR-3B filing.
Submit details of outward supplies
Taxpayers who have opted for the QRMP can use the Invoice Furnishing Facility (IFF) which allows GSTR-1 quarterly applicants to upload their invoices on a monthly basis. One should keep the following points in mind before applying the IFF:
- IFF can only be apply for the 1st two months of the quarter.
- Invoices related to the last quarter of the quarter should be uploaded to GSTR-1 return only.
- No need to upload invoices to GSTR-1 if the same is uploaded to IFF.
- The taxpayer must submit the details of the B2B invoices for the transaction (both provincial and local) and the debit notes and credits for B2B invoices issued during the month.
- The total amount of invoices that can be downloaded is limited to Rs.50 lakh per month.
- Details submitted to IFF will be displayed in GSTR-2A, GSTR-2B, GSTR-4A or GSTR-6A recipients as the case may be.
- The Invoice Furnishing Facility will be operational from 01.01.2021.
Make monthly tax payments under the QRMP scheme
For the first and second months of the year, the taxpayer must deposit tax using form GST PMT-06 by the 25th of the following month. Taxpayers have the option of paying their monthly tax bill using the Fixed Sum Method (FSM), also known as the 35 percent challan method, or the Self -Assessment Method (SAM).
Fixed Sum Method
Under this method, a taxpayer must pay an amount of tax equal to 35 percent of the tax paid in cash, as represented in the pre-filled challan (on the basis of prior tax payment) in Form GST PMT-06. The Fixed Sum Method (FSM), also known as the 35 percent challan method, consists of the following steps:
The taxpayer must pay a tax sum specified in a pre-filled challan in the form GST PMT-06, which is equivalent to 35% of the tax paid in cash.
|S No||Kind of Taxpayer||Tax needs to be paid|
|1||For the previous year, who got GSTR-3B quarterly?||In the previous quarter, 35% of tax was paid in cash.|
|2||During the previous quarter, who provided GSTR-3B monthly?||In the last month of the previous year, you paid 100 percent of your taxes in cash.|
SAM (Self-Assessment Method):
This is the current method of estimating a taxpayer’s tax obligation by taking into account the tax liability on inbound and outbound supplies as well as the available input tax credit. The taxpayer must manually calculate his or her monthly tax liability and pay it using form GST PMT-06. The taxpayer will use form GSTR-2B to calculate the amount of ITC available for the month.
There are some cases where no money is needed to be deposited, for example –
- For the first month of the year, if the electronic cash/credit ledger balance is sufficient to cover the tax liability for that month OR if the tax liability is zero.
- For the second month of the year, if the electronic cash/credit ledger balance is sufficient to cover the accumulated tax liability for the first and second months of the year OR if there is no tax liability.
It should be remembered that a registered person would not be eligible for the procedures unless he has filed a return for the entire tax period preceding the month in question. A full tax period is one in which the same entity is registered from the beginning to the end of the period.
Steps to Making Tax Payments Under the QRMP Scheme
- Step 1: Log in to the GST site and navigate through Dashboard> Payments> Create challan payment.
- Step 2: Under ‘Challan Reason’, select the option ‘Monthly Quarterly Payment’. Select a financial year, time, type of call, and click on ‘Proceed’. QRMP payment
- Step 3: Click on ‘Generate 35% challan’ to automatically generate challan on the basis of the past ‘GSTR-3B.
- Step 4: Pay for the system made with 35% challan.
Note: A taxpayer is not required to pay tax within the first two months of a quarter if the balance received by electronic money/credit is sufficient for the tax payable, or there is a tax liability.
QRMP Scheme Access Time Limit
The QRMP scheme can be available year-round, in any quarter.
Registered persons can enter any quarter from the first day of the second month of the previous quarter to the last day of the first month of the quarter.
Note & Example
- Note: The registrant must pay the final refund, because on the day of using that method to receive the QRMP Scheme
- Example: Mr Ram wants to use the QRMP system from July to Sep 2021 Quarter. This may apply from May 1 2021 to July 31 2021.
If Mr Ram used this on June 27, he should have installed GSTR 3B by May 2021 before June 22/24
Taxpayers are not required to use the option on a quarterly basis. The option when used will always be the same as the successful sites and unless the taxpayer changes the option.
Due Dates For Payments in the QRMP Scheme
The tax due in each of the first two months of the quarter should be paid by the 25th of the following month in that quarter for all registered persons under the QRMP scheme. The tax due for the month of January 2021, for example, should be deposited by February 25th, 2021. The tax should be deposited using Form GST PMT-06. The fixed sum method or the self-assessment method may be used to pay the taxes.
Late Fees and Their Applicability
The late fee will be levied if the quarterly GSTR-3B and GSTR 1 are not submitted by the due date, i.e., Rs. 50 per day (CGST: SGST) up to a limit of Rs 5,000.
It is explained, however, that there is no late fee if you pay your tax late in the first two months of the quarter using form GST PMT-06.
This is a positive initiative that will give small taxpayers more enforcement flexibility. Furthermore, as many suppliers are filing GSTR 1 quarterly, this could prove to be a blessing not only for small taxpayers but also for major players who are currently losing credits due to non-reflection of entries in GSTR 2A, resulting in time and money savings. Furthermore, this scheme is expected to plug tax leakages and frauds from the government’s viewpoint, as it could prove to be a significant weapon in combating the ongoing threat of false invoicing and fake credits. As a result, it seems that everybody will benefit from the efficient implementation of the QRMP scheme.
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