Wednesday, January 6, 2021

Quarterly Return Monthly Payment (QRMP) in GST from 01-Jan-2021

The CBIC has introduced the Quarterly Return Filing and Monthly Payment of Taxes (QRMP) scheme under GST to help small taxpayers whose annual turnover is less than Rs. 5 crores. This scheme allows taxpayers to file their GSTR-3B on quarterly basis, but continuing to pay tax every month.

Eligibility for QRMP

Any registered person with annual aggregate turnover up to Rs. 5 crores in the preceding financial year may be allowed to file his GST returns on quarterly basis, with payment of tax on a monthly basis.

If the aggregate turnover exceeds Rs. 5 crore at any time during the year, the person would not be eligible for QRMP from the succeeding quarter.

Further, a person would be eligible for QRMP in any quarter only if the last return due as on date of availing such option has been filed. 

If a person has multiple registration numbers on the same PAN, they may choose to opt-in for QRMP for only a few out of all the registrations.

Features of QRMP

Any eligible person who has availed the option would have to:

a) furnish details of outward supply in Form GSTR-1 on a quarterly basis

b) facility to furnish invoices relating to the first and second months of such quarter through the Invoice Furnishing Facility (IFF) available on the portal latest by the 13th of the succeeding month. This has been enabled so that the customers of such persons can view the invoices in their GSTR-2A, GSTR-2B and avail input tax credit (ITC) thereon without having to wait for the quarterly GSTR-1 to be filed.

c) pay the GST for a month by the 25th of the succeeding month through challan in Form PMT-06. While generating such challan, the person should select the option "monthly payment for quarterly taxpayer"

What is Invoice Furnishing Facility (IFF)?

Persons availing QRMP may furnish details of outward supplies to a registered person through the IFF table for such month on the GST portal. The IFF can be utilised only for the first two months of a quarter as for the invoices relating to the last month of the quarter, it will be time to file the return for the entire quarter in Form GSTR-1.

There is no requirement to upload invoices in GSTR-1 if the same has been uploaded in the IFF.

The outward supplies in any month being filed through IFF shall not exceed Rs. 50 lakh.

Outward supplies can be reported on IFF only up to the 13th of the succeeding month.

If a taxpayer's annual aggregate turnover is more than Rs. 1.5 crore but below Rs. 5 crores, such person cannot use the IFF utility to report their outward supplies. In such cases, they can opt for the QRMP scheme, but they have to submit their outward supplies in GSTR-1 on a monthly basis.

How is the Monthly Tax Payment amount to be determined?

A registered person may pay tax on monthly basis in either of the following two ways in PMT-06.

a) Self Assessment Method

Calculation taking into account actual sales amount and tax computed as payable under the heads of CGST, SGST, IGST after accounting for the deduction due to available ITC. This is actual computation on monthly basis and paying the amount due in PMT-06.

b) Fixed Sum Method

If a person is unable to determine his tax liability on a monthly basis, to avoid interest on short payment or delayed payment, he may choose to compute his tax payable in the following manner.

(i) Where the previous return was filed quarterly, an amount equal to 35% of the tax paid in cash in the previous quarter, may be paid monthly; or

(ii) Where the previous return was filed monthly, an amount equal to the tax paid in cash in the last month.

Such amount of tax would be paid in the same proportion in CGST, SGST, IGST and Cess, as deposited in the past quarter or month, as the case may be.

How will eligible ITC be ascertained for each month?

ITC will only be claimed as per the auto-drafted statement in Form GSTR-2B for every month. 

How will GSTR-3B be filed?

The quarterly GSTR-3B would be filed by the 22nd or 24th of the month succeeding the relevant quarter end. The due date of 22nd or 24th is determined based on the state of registration of the registered person, as already in place.

The GSTR-3B would declare the amount of tax on outward supply and the ITC. The amount paid in PMT-06 during the first two months of the quarter will be used to offset the liability determined in GSTR-3B for the relevant quarter.

Any amount extra deposited may be claimed as a refund or offset against the liability in future quarters.

Late fee will be payable in case of delay of GSTR-3B. However, there will be no late fee due to delayed payment of tax in PMT-06. Interest would be payable on delayed payment in PMT-06 beyond the due date for the period from the due date to the actual date of payment.

When is the QRMP Option Exercisable?

For any quarter, a person may opt for this option at anytime between the first day of the second month of the preceding quarter to the last day of the first month of the relevant quarter.

Example: To opt for QRMP for Q1 of FY 2021-22, you may avail the option at anytime from 01-Feb-2021 to 30-Apr-2021.

How to Exercise Option on the GST Portal?

If eligible, click on the Returns tab after logging in to the portal and select "Opt-in for Quarterly Return"

Due Dates of Returns in GSTR-3B

a) 22nd of the month succeeding such quarter: 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

b) 24th of the month succeeding such quarter: 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

Further Reading