The Quarterly Return Filing and Monthly Payment of Taxes (QRMP) Scheme was introduced by the CBIC from 1st January 2021, to help small taxpayers by way of reducing their compliance burden.
1. What is the QRMP Scheme?
A registered taxpayer with an aggregate annual turnover of up to Rs.5 crore in the preceding financial year can opt for the QRMP scheme. This scheme allows taxpayers to file the GSTR-3B quarterly, but to pay taxes on a monthly basis. Thus, small taxpayers can now file only eight returns in a year, i.e., four GSTR-1 returns and four GSTR-3B returns instead of 16 returns in a year.
Under the QRMP scheme, an Invoice Furnishing Facility (IFF) is also available to taxpayers, to upload their supply invoices monthly on the GSTN, even though the GSTR-1 is to be filed quarterly. These invoices will be reflected in the GSTR-2A and GSTR-2B of their customers, who can use the input tax credits (ITC) on a timely basis. This prevents their customers from losing out on eligible input credits.
2. Due Dates For Payments Under the QRMP Scheme
All registered persons under the QRMP scheme should pay the tax due in each of the first two months of the quarter by the 25th of the next month in that quarter. For example, the tax due for the month of January 2021 should be deposited by 25th February 2021.
A taxpayer should deposit the tax using Form GST PMT-06. The taxes can be paid either using the fixed sum method or the self-assessment method. Both the methods are discussed in detail below.
3. Methods of Making Payments Under the QRMP Scheme
Registered persons can make payments for the first two months of the quarter by using either of the following methods:
- Fixed Sum Method- Under this method, a taxpayer shall pay an amount of tax as reflected in the pre-filled challan (on the basis of the previous tax payment) in Form GST PMT-06, for an amount equal to 35% of the tax paid in cash.
|Tax paid in Quarter Jan-Mar’21||Tax to be paid in each month, for Apr’21 and May‘21|
However, if a taxpayer has been filing his return monthly for Jan-Mar’21, then he/she can opt to pay an amount equal to the tax paid in the last month of the preceding quarter.
|Tax paid in Mar’21||Tax to be paid in each month, for Apr’21 and May‘21|
- Self Assessment Method (Actual Tax Due): Under this method, a taxpayer will pay the tax on outward supplies after taking into consideration the input tax credit available. In this case, the taxpayer will manually arrive at the tax liability and deposit the same in Form GST PMT-06. The taxpayer can refer Form GSTR-2B to arrive at the amount of ITC available.
- The amount deposited by the taxpayer for the first two months of the quarter shall be solely debited for the purpose of offsetting the liability in that quarter’s Form GSTR-3B. Any amount remaining after filing that quarter’s Form GSTR-3B may either be claimed as a refund or used for any other purpose in the subsequent quarters.
- In the case of cancellation of registration of a taxpayer during any of the first two months of the quarter, he would still be required to furnish his Form GSTR-3B for that relevant tax period.
4. Applicability of Interest Under the QRMP Scheme
Interest is applicable under the QRMP scheme if:
- Payment is not made in Form GST PMT-06: If the payment is not made within the due date, interest will be applicable from the due date of furnishing Form GST PMT-06 until the date of making payment.
- Non-filing of Form GSTR-3B: If the return in Form GSTR-3B is not filed within the due date, then interest is applicable as per the provisions of Section 50 of the Central Goods and Services Tax (CGST) Act for the tax liability, net of ITC.
- The tax due in the first month is not paid on or before the 25th of the next month.
- The tax due in the second month is not paid on or before the 25th of the next month.
- The total tax liability for the quarter (net of ITC) reported in the Form GSTR-3B, which is not filed on or before the due date.
In this case, interest will be charged separately for the number of days delayed in the first month, second month, and the GSTR-3B.
Rate of interest- 18% of the net tax liability which remains unpaid or paid after the due date for any of the months of the quarter.
Also, a late fee is applicable if there is a delay in filing the returns (GSTR-3B/GSTR-1). A late fee of Rs.50 per day is charged (Rs.20 for nil returns), subject to a maximum of Rs.5,000. However, no late fee is charged for a delay in payment of tax for the first two months of the quarter.
5. Steps to Make Tax Payments Under the QRMP Scheme
Step 1: Log in to the GST portal and navigate through Dashboard> Payments> Create challan.
Step 2: Under ‘Reason for Challan’, select the ‘Monthly payment for quarterly return’ option. Select the financial year, period, type of challan and then click on ‘Proceed’.
Step 3: Click on ‘Generate 35% challan’ to auto-generate the challan on the basis of the previous periods’ GSTR-3B.
Step 4: Pay the system generated 35% challan.
Note: A taxpayer is not required to make any tax payment during the first two months of the quarter if the balance in the electronic cash/credit ledger is sufficient for the tax due, or there is a nil tax liability.