QRMP Scheme: Quarterly Filing with Monthly Payment
Who can opt into QRMP, IFF mechanics, PMT-06 monthly payment, and the fixed-sum method.
QRMP Scheme: Quarterly Filing with Monthly Payment
The QRMP (Quarterly Return Monthly Payment) Scheme is a simplified GST compliance option for small taxpayers with an aggregate annual turnover of up to ₹5 crore. It allows them to file their GSTR-3B return quarterly while making GST payments monthly, significantly easing the compliance burden compared to monthly filing. This scheme also includes the Invoice Furnishing Facility (IFF) for B2B supplies, ensuring recipient businesses can claim Input Tax Credit (ITC) promptly.
Who is eligible for the QRMP Scheme?
Any registered person under GST whose aggregate annual turnover is up to ₹5 crore in the preceding financial year is eligible for the QRMP Scheme. This threshold is crucial; if your turnover exceeds ₹5 crore, you are not eligible and must file monthly. The scheme is designed to benefit small and medium enterprises by reducing the frequency of return filing. Eligibility is assessed at the beginning of each financial year.
How does the Invoice Furnishing Facility (IFF) work under QRMP?
The Invoice Furnishing Facility (IFF) allows QRMP taxpayers to upload details of outward B2B supplies (invoices) in the first two months of a quarter, enabling recipient businesses to claim Input Tax Credit (ITC) promptly. This facility is optional and can be used for B2B invoices up to a cumulative value of ₹50 lakh in each of the first two months. It is not mandatory to use IFF if there are no B2B supplies or if the value is low. The details furnished through IFF are reflected in the recipient's GSTR-2A and GSTR-2B.
How are monthly GST payments made under the QRMP Scheme?
Under the QRMP Scheme, taxpayers must make monthly GST payments using Form PMT-06, even though returns are filed quarterly. There are two primary methods for calculating the monthly payment: the Fixed Sum Method and the Self-Assessment Method. The payment for the first two months of the quarter is due by the 25th of the following month. For example, for the April-June quarter, payment for April is due by May 25th, and for May, by June 25th.
What are the Fixed Sum Method and Self-Assessment Method for payments?
The Fixed Sum Method and Self-Assessment Method are the two ways QRMP taxpayers can calculate their monthly GST payments.
The Fixed Sum Method is a simpler approach where the taxpayer pays a pre-determined amount. This amount is either:
- 35% of the tax paid in cash in the preceding quarter's GSTR-3B, if the last return was filed quarterly.
- 100% of the tax paid in cash in the preceding month's GSTR-3B, if the last return was filed monthly. This method is suitable for businesses with consistent tax liabilities. No interest is charged if the payment is made by the due date, even if the actual liability is higher, provided the GSTR-3B is filed on time.
The Self-Assessment Method requires the taxpayer to calculate their actual tax liability for the month, considering both outward supplies and available Input Tax Credit (ITC). This method is more accurate for businesses with fluctuating sales or purchases. Taxpayers using this method must ensure their calculation is correct, as interest may be levied if the actual liability is underpaid.
Here's a comparison of the two methods:
| Feature | Fixed Sum Method | Self-Assessment Method |
|---|---|---|
| Calculation | Based on previous quarter's/month's cash payment | Based on actual current month's liability |
| Complexity | Simpler, less calculation required | More complex, requires monthly calculation |
| Suitability | Businesses with stable tax liability | Businesses with fluctuating tax liability |
| Interest | No interest if paid on time (even if underpaid) | Interest applicable if actual liability is underpaid |
| ITC Utilisation | Cannot utilise current month's ITC for payment | Can utilise current month's ITC for payment |
| Flexibility | Less flexible, fixed percentage payment | More flexible, pays actual liability |
When can I opt in or opt out of the QRMP Scheme?
Taxpayers can opt into or opt out of the QRMP Scheme from the first month of any quarter, up to the last day of the first month of the quarter. For example, to opt into the scheme for the April-June quarter, you must do so between February 1st and April 30th. Once opted in, you remain in the scheme for subsequent quarters unless you opt out or become ineligible. The option can be exercised on the GST portal.
Relevant Statutory Citations:
- Notification No. 84/2020 – Central Tax, dated 10th November, 2020: This notification introduced the QRMP Scheme.
- Rule 61A of the CGST Rules, 2017: Specifies the conditions and procedure for opting for the QRMP Scheme.
- Rule 59(2) of the CGST Rules, 2017: Deals with the Invoice Furnishing Facility (IFF).
- Form GST PMT-06: The challan used for making monthly payments under the QRMP Scheme.
How SP & SC helps
Navigating the intricacies of GST compliance, especially schemes like QRMP, can be challenging. Our expert team at SP & SC Legal and Taxation Services provides comprehensive support for GST return filing, ensuring you meet all statutory requirements efficiently and accurately. We can assist with QRMP scheme selection, IFF utilisation, monthly payment calculations, and timely GSTR-3B filing. Visit our GST Return Filing services page to learn more.
Frequently asked questions
What happens if my turnover exceeds ₹5 crore during a financial year while I am in the QRMP Scheme?
If your aggregate annual turnover exceeds ₹5 crore during a financial year, you will become ineligible for the QRMP Scheme from the next quarter. You will then be required to file your GSTR-3B returns monthly. The GST portal will automatically change your filing frequency.
Is it mandatory to use the Invoice Furnishing Facility (IFF)?
No, the Invoice Furnishing Facility (IFF) is optional. It is provided to enable recipient businesses to claim Input Tax Credit (ITC) on B2B supplies in the first two months of a quarter. If you have no B2B supplies or prefer to declare all outward supplies in the quarterly GSTR-1, you are not required to use IFF.
Can I change my payment method (Fixed Sum vs. Self-Assessment) during a quarter?
No, once you select a payment method for a quarter, you must stick to it for that entire quarter. You can change your payment method for the subsequent quarter when you make the payment for the first month of that new quarter.
What is the due date for filing the quarterly GSTR-3B under the QRMP Scheme?
The due date for filing the quarterly GSTR-3B under the QRMP Scheme is the 22nd or 24th of the month succeeding the quarter, depending on the state or union territory of the registered person. For example, for the April-June quarter, the GSTR-3B is due by July 22nd or July 24th.
What if I miss a monthly payment under the QRMP Scheme?
If you miss a monthly payment under the QRMP Scheme, interest will be levied on the unpaid tax amount from the due date of payment until the date of actual payment. If you used the Fixed Sum Method, interest would only be applicable if the final tax liability declared in GSTR-3B is higher than the fixed sum paid. If you used the Self-Assessment Method, interest is always applicable on any underpaid amount.
Can a newly registered taxpayer opt for the QRMP Scheme?
Yes, a newly registered taxpayer can opt for the QRMP Scheme if their projected aggregate annual turnover for the current financial year is up to ₹5 crore. They can exercise this option at the time of registration or before filing their first return.