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Quarterly Return Filing and Monthly Payment of Taxes (QRMP) Scheme under GST

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The Central Board of Indirect Taxes & Customs (CBIC) introduced Quarterly Return Filing and Monthly Payment of Taxes (QRMP) scheme under Goods and Services Tax (GST) to help small taxpayers whose turnover is less than Rs.5 crores. The QRMP scheme allows the taxpayers to file GSTR-3B on a quarterly basis and pay tax every month.

Important Update

6th January 2021

IFF is LIVE on GST portal. Sorting out the B2B documents for IFF reporting becomes essential to pass tax credits to buyers but may get cumbersome. ClearTax has a host of features to aid you in faster and accurate compliance. Click here to explore.

December 2020

The last date to opt in or out of the QRMP scheme for small GST taxpayers is 31st January 2021 for the quarter of Jan-Mar 2021.

ClearTax GST software has in-built solution to help you finish this task easily. Tax professionals or businesses can easily upload CSV file format containing the list of GSTINs and the selected filing frequency either ‘monthly’ or ‘quarterly’ on ClearTax GST. The same will get updated on the GST portal within a few seconds!

For a complete feature set on ClearTax GST software for complying under QRMP scheme, click here. Try out ClearTax GST Now

1. Who is eligible for the QRMP scheme?

A registered person who is required to furnish a return in FORM GSTR-3B, and who has an aggregate turnover of up to 5 crore rupees in the preceding financial year, is eligible for the QRMP Scheme. Further, in case the aggregate turnover exceeds five crore rupees during any quarter in the current financial year, the registered person shall not be eligible for the scheme from the next quarter.







It is clarified that the aggregate annual turnover for the preceding financial year shall be calculated in the common portal taking into account the details furnished in the returns by the taxpayer for the tax periods in the preceding financial year.

The quarterly GSTR-3B filing option will be available from 1st January 2021 onwards. It is clarified that this scheme is optional and can be availed based on GSTIN.

2. How to exercise Option for QRMP Scheme?

A registered person who intends to file his GSTR-3B quarterly should indicate the same on GST portal, from the 1st of the second month of the preceding quarter until the last day of the first month of the quarter for which such option is being exercised.

For example: If A wishes to file quarterly returns for the quarter of Jan-Mar 2021, he should opt for quarterly filing on the common GST portal between 1st November 2020 and 31st January 2021.

Once the registered person has opted for quarterly filing, he will have to continue to furnish his return every quarter for all future tax periods, except in the following situations:

  1. If the taxpayer becomes ineligible for furnishing a quarterly return (for example, if the aggregate turnover crosses Rs.5 crore during a quarter, then from the next quarter he will not be able to file quarterly returns). If the taxpayer opts to furnish GSTR-3B on a monthly basis.
  2. A registered person will not be eligible to opt for furnishing quarterly returns if the last return, which was due on the date of exercising such an option has not been furnished.

For example: If the person is opting for quarterly GSTR-3B filing on 1st December 2020, he will need to furnish his GSTR-3B return for October 2020, which would have been the last return due on the date of exercising the quarterly filing option.

3. Deemed monthly/quarterly filing of GSTR-3B

The taxpayer has to follow the above procedure to opt for the quarterly GSTR-3B. However, the GSTN case of registered persons falling in the categories specified in the table below, who have furnished their GSTR-3B return for October 2020 by 30th November 2020, it shall be deemed that they have opted for monthly or quarterly filing as detailed below-

 

S No.

Class of Registered Persons

Deemed Option

1

Registered individuals with an aggregate turnover of up to Rs.1.5 crore, who have furnished Form GSTR-1 quarterly in the current financial year

Quarterly GSTR-3B

2

Registered persons with an aggregate turnover of up to Rs.1.5 crore, who have furnished Form GSTR-1 monthly in the current financial year

Monthly GSTR-3B

3

Registered persons having an aggregate turnover exceeding Rs.1.5 crore and up to Rs.5 crore in the preceding financial year 

Quarterly GSTR-3B

The taxpayers referred to in the Sl. No. 2 in the above table can change the default option and opt for quarterly GSTR-3B filing between 5th December 2020 and 31st January 2021.

4. How to submit details of outward supplies?

The taxpayers who opted for the QRMP scheme can use the Invoice Furnishing Facility (IFF) which allows quarterly GSTR-1 filers to upload their invoices every month. One should keep the following points in mind before utilising the IFF:

    • The IFF can be utilised only for the first two months of a quarter.
    • The invoices relating to the last month of a quarter are to be uploaded in the GSTR-1 return only.
    • There is no requirement to upload invoices in GSTR-1 if the same has been uploaded in the IFF.
    • The taxpayer has to submit the B2B invoice details of sale transactions (both inter-state and intra-state) along with debit and credit notes of the B2B invoices issued during the month.
    • The total net 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 Invoice Furnishing Facility will come into effect from 01.01.2021.

invoice-furnishing-facility(IFF)

5. How to make monthly tax payments under the QRMP scheme?

The taxpayer has to deposit tax using form GST PMT-06 by the 25th of the following month, for the first and second months of the quarter. The taxpayers can pay their monthly tax liability either in the Fixed Sum Method (FSM), also popular as 35% challan method, or Self Assessment Method (SAM).

Fixed Sum Method (FSM) or 35% challan method:

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

 

S 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

Example for understanding FSM:

Scenario 1: If GSTR-3B for January 2021 to March 2021 was filed on a 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

10,000

 

CGST

3,500

SGST

10,000

 

SGST

3,500

IGST

20,000

 

IGST

7,000

Cess

3,000

 

Cess

1,050

Scenario 2: If GSTR-3 was filed on a monthly basis during the quarter of January 2021 to March 2021

 

Tax paid in cash during Mar’21

 

Tax required to be paid in each of Apr’21 and May’21

CGST

3,000

 

CGST

3,000

SGST

3,000

 

SGST

3,000

IGST

5,000

 

IGST

5,000

Cess

1,000

 

Cess

1,000

Self Assessment Method (SAM):

This is the existing method where a taxpayer can pay the tax liability by considering the tax liability on inward and outward supplies and the input tax credit available. The taxpayer has to manually arrive at the tax liability for the month and has to pay the same in form GST PMT-06. For ascertaining the amount of ITC available for the month the taxpayer can use form GSTR-2B.

There are certain instances where no amount may be required to be deposited, such as –

      1. For the first month of the quarter – where the balance in the electronic cash/credit ledger is adequate for the tax liability of the said month OR where the tax liability is nil.
      2. For the second month of the quarter – where the balance in the electronic cash/credit ledger is adequate for the cumulative tax liability for the first and second months of the quarter OR where the tax liability is nil.

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 a tax period where the said person is registered from the first until the last day of the tax period.

    •  
    •  

6. Due dates for filing quarterly GSTR-3B

The due dates filing quarterly GSTR-3B has been notified as follows:

 

S No

GST Registration in States and Union Territories

Due Date

1

Chhattisgarh, Madhya Pradesh, Gujarat, Dadra and Nagar Haveli, Daman and Diu, Maharashtra, Karnataka, Goa, Lakshadweep, Kerala, Tamil Nadu, Puducherry, Andaman and Nicobar Islands, Telangana and Andhra Pradesh

22nd of the month succeeding such quarter

2

Jammu and Kashmir, Ladakh, Himachal Pradesh, Punjab, Chandigarh, Uttarakhand, Haryana, Delhi, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Mizoram, Manipur, Tripura, Meghalaya, Assam, West Bengal, Jharkhand and Odisha

24th of the month succeeding such quarter

7. Interest under QRMP scheme

    • The interest will be applicable as follows if the taxpayer opts for

Fixed Sum Method (FSM) or popularly known as the 35% challan method

    • :

 

S No

Scenario

Interest 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)

    • *22nd or 24th of the month succeeding such quarter based on the state of the taxpayer.

The interest will be applicable as follows if the taxpayer opts for 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.

It is important to note that the taxpayer has to pay interest @18% if there is any late payment of tax in the third month of a quarter. This is applicable irrespective of Fixed Sum Method (FSM), popular as 35% challan method, or Self Assessment Method (SAM).

8. Late fee under QRMP scheme

The late fee should be paid as follows if the quarterly GSTR-3B is not filed within due date, subject to a maximum late fees of Rs 5,000:

 

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

However, it is clarified that no late fee is applicable for delay in payment of tax in the first two months of the quarter in form GST PMT-06.

9. Issues or Challenges under QRMP with ClearTax Solutions

Whether to opt into QRMP or to continue with monthly returns must be decided for each of the GSTINs of a business (PAN), which can be tedious and time consuming. The segregation of the documents as B2B and non-B2B must also be done where the taxpayer opting into the scheme uses the Invoice Furnishing Facility (IFF). It would help in moving the B2B documents to IFF and rest directly to the quarterly GSTR-1 return. Moreover, the reconciliation between IFF, sales register and GSTR-1 becomes more essential. Further, the taxpayer under QRMP scheme must choose between two methods for tax payment every month, i.e. Fixed Sum/35% challan Method and Self-assessment Method.

All the above challenges listed down can be addressed using a single solution – ClearTax GST software. The following features will help any business as well as tax professional to comply with the rules listed down for the QRMP scheme.

      • Single window to modify QRMP Profile for all your GSTINs in one go
      • Auto Preparation of Quarterly GSTR 1 and GSTR-3B from Sales and Purchases Registers
      • Fetching of Turnover and Filing Frequency from GST Portal (Coming soon)
      • Option to Upload B2B Invoices/CDN in IFF from Sales Register (Coming soon)
      • Automation of Challan Creation, Payment and Track Payment Status (Coming soon)

What’s more:

You can enjoy value added features to save time and efforts manifold!

      • Intuitive Payment Dashboard for Challan Management and Tax Saving Optimization
      • Bulk Challan Status Check, Bulk Email Sharing and Bulk download of Challans
      • Reconciliation of Sales with Monthly IFF and Quarterly GSTR-1

For a detailed understanding about each of the above features, download your copy of ClearTax GST Feature Set on QRMP now!

Download Now

Also, e-Invoicing is India’s biggest tax reform next to GST, which is expected to soon encompass every business. Stay ahead of the curve! Read our article to get an overview of e-Invoicing System.

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