Quarterly Returns with Monthly Payment Scheme, commonly referred to as QRMP scheme under GST allows eligible taxpayers to file their Form GSTR-1 and Form GSTR-3B returns on quarterly basis. However, these taxpayers will pay their tax dues on monthly basis with the help of a challan.
Active since 1st January 2021, the Quarterly Return Monthly Payment Scheme or QRMP Scheme under GST was established by the Central Board of Indirect Taxes and Customs under the Goods and Service Tax (GST) system. This scheme has been programmed to enable small business taxpayers to file GST Returns at the end of each quarter and make monthly tax payments.
While taxpayers had to file the GSTR-1 and GSTR-3B on monthly basis earlier, now with the implementation of scheme, taxpayers are allowed to furnish returns quarterly.
Doing so helps lessen the number of returns you need to file every year. Furthermore, the scheme allows you to pay taxes in two methods. They are the self-assessment method and the fixed sum method. However, this scheme is not mandatory, so any taxpayer can decide to use it or do without.
The objective of introducing QRMP Scheme was to support taxpayers to lessen their burden of furnishing tax returns every month and conveniently operate their businesses. This applies to registered taxpayers making a turnover up to Rs. 5 Crores in the last financial year.
The Central Board of Indirect Taxes & Customs has launched this program under the GST administration to streamline the process of tax payments and tax return filing for small businesses.
Opting for this scheme can benefit them in various ways mentioned below:
It will reduce taxpayers' obligations considerably as they will require filing four returns only rather than twelve GSTR-3B returns every year.
This will help in the payment of monthly tax conveniently using Pre-filled Challan or Self-Assessment method in the first two months of each quarter.
Taxpayers can decide when to opt-in as well as opt-out of this QRMP scheme under GST Quarterly Return Scheme at the portal all year round.
As a taxpayer, you can enjoy the ease of a flexible invoicing facility as Invoice Filing Facility (IFF) has been allowed under this program. The IFF facility enables you to furnish four GSTR-1 returns each year. Moreover, you can unload your invoices during the first two months quarterly. As a result, you will not need to wait till last of the quarter to file the return. Moreover, IFF permits you to claim Input Tax Credits fast.
This will also lessen your cost for assessment of tax liability on a quarterly basis compared to the earlier system on a monthly basis.
Following are the eligibility criteria for QRMP Scheme:
You must furnish a return in GSTR-3B, with a total turnover of up to Rs. 5 Crores in the previous financial year, to become eligible for QRMP Scheme under GST.
You can only opt for this scheme if you have the right to file Form GSTR-1 and Form GSTR-3B returns.
The previous GSTR-3B returns have to be filed positively.
The total turnover of last financial year should not exceed Rs. 5 Crores. Otherwise, you will be treated as ineligible for QRMP Scheme from the upcoming quarters.
There must not be any data previously saved in the portal of Form GSTR-1 for the specified tenure during which you are availing of this scheme. If there is, you have to delete the saved data from this form in order to go for this scheme.
You can also opt for QRMP Scheme under GST while obtaining the GST Composition Scheme or a new GST registration.
This QRMP Scheme will be available only if you have the Goods and Services Tax Identification Number or GSTIN.
If you have not furnished the previous outstanding return, you will be unable to furnish further quarterly returns.
Steps to avail of QRMP Scheme for quarterly GST returns are as follows:
Step 1: Visit the official Goods and Service Tax (GST) portal.
Step 2: Choose the Quarterly Return Monthly Payment (QRMP) Scheme.
Step 3: Click on log in and enter your credentials.
Step 4: Select on ‘Services’ option.
Step 5: Click on ‘Returns’.
Step 6: Finally, select the option for quarterly return.
Now, after availing of this scheme, you need to know how to make tax payments according to the QRMP Scheme. The steps to make payments of tax are mentioned below:
Step 1: Visit the Goods and Service Tax official website.
Step 2: Log in to the portal using your credentials.
Step 3: From the ‘Options’ section, go to the Dashboard.
Step 4: After fetching the Dashboard, Click on Payments, and then go to the ‘Create challan’ option.
Step 5: You will find a section called the ‘Reason for Challan’ wherein you have to choose the option ‘Monthly payment for quarterly return.’ Also, choose the time, financial year, and challan type before clicking on ‘Proceed.’
Step 6: Those following fixed sum method and self-assessment methods must select the option of ‘35% challan’ and ‘Challan on self-assessment basis’, respectively.
Step 8: Select your mode of payment and pay the amount generated on challan.
Registered businesses are allowed to make payments for the first two months of a quarter by any of the following methods:
Fixed Sum Method: As per this method, a taxpayer needs to pay a tax amount, as shown in the pre-filled challan in Form GST PMT-06, for a sum equal to 35% of the amount of tax paid.
Self-Assessment Method: According to this method, a taxpayer must pay the tax on outward supplies after considering the input tax credit. Here, the taxpayer should pay their tax liability and deposit it in Form GST PMT-06.
Input Tax Credit claims under QRMP Scheme depend on some scenarios mentioned below:
In case of fixed sum method, ITC claim amount will be considered 35% of the tax amount of the previous quarter.
When it comes to the self-assessment method, the amount of ITC claimed to be considered will be the tax amount for the first two months of the quarter.
The interest rate applicable under QRMP Scheme depends on several scenarios mentioned below:
No interest is to be paid if tax liability shown in GST PMT-06 pre-filled form is cleared within 25th of next month. On the contrary, if you fail to clear it by 25th of next month, then you will be obligated to pay interest at 18% of the tax liability.
No interest is to be paid if the final tax liability of the first two months is equal to or less than the amount funded via pre-filled form GST PMT-06.
Interest will not be charged if the first two months’ final tax liability is more than the amount of tax paid via pre-filled form GST PMT-06.
The late fee or penalty must be paid if the quarterly GSTR-3B is not filed before the due date, and it will result in a late fee, going up to a maximum of Rs. 5,000. However, there will be no involvement of late fees during the tax payment of the first two months of the quarter as per form PMT-06. Even though late fees involved in CGST and SGST remain constant, it varies in IGST.
Now that the concept of the QRMP Scheme under GST is crystal-clear, you can opt for this scheme without hassle. However, make sure that you go through each of its necessary conditions and eligibility criteria before making your decision.
The Quarterly Return Filing and Monthly Payment of Taxes (QRMP) scheme has been introduced by the Central Board of Indirect Taxes & Customs (CBIC). It is a part of GST and is beneficial for taxpayers who have a turnover of less than Rs 5 crore. Under this, small taxpayers can pay taxes on a quarterly basis.
Taxpayers who are eligible under QRMP are assigned the quarterly payment system by GST. The information is sent to such taxpayers through e-mail/SMS.
Payment of liability can be made in the first two months of the quarter in two ways:
Fixed Sum Method
Yes, but you can avail of the Quarterly Return Monthly Payment Scheme only if you can file Form GSTR-1 and Form GSTR-3B returns.
Yes, a newly registered taxpayer can opt for the QRMP Scheme only if his/her Annual Aggregate Turnover is up to Rs. 5 Crores.
Yes. By the time you select the QRMP scheme, you have to file both Form GSTR-1 and Form GSTR-3B on a quarterly basis.