QRMP Scheme in GST: Rules, Rates and Compliance

Introduction

The QRMP scheme in GST (Quarterly Return Monthly Payment) is a significant initiative by the Government of India aimed at simplifying tax compliance for small taxpayers. This scheme is specifically designed to ease the burden of frequent return filing while ensuring regular tax payments. Businesses with an aggregate turnover of up to ₹5 crores in the preceding financial year can opt for the QRMP scheme in GST, allowing them to file GST returns quarterly instead of monthly while making monthly tax payments.

Understanding the QRMP scheme in GST is essential for small and medium enterprises (SMEs) looking to streamline their tax compliance. A trader in Delhi, for example, with an annual turnover of ₹4 crores, can benefit from this scheme by reducing the frequency of GST return filings. However, staying updated with the Latest updates on the QRMP scheme is crucial, as changes in regulations, eligibility criteria, and procedural requirements can impact businesses’ compliance obligations.

One of the key aspects to consider is the QRMP scheme in GST exemption criteria. Not all businesses qualify for this scheme, and understanding the eligibility parameters is vital. For instance, businesses exceeding the ₹5 crore turnover limit or those engaged in specific high-tax liability transactions may be ineligible for this scheme. Furthermore, businesses must ensure they are registered under the GST portal and comply with the scheme’s guidelines to continue enjoying its benefits.

Many taxpayers also face confusion regarding how to file the QRMP scheme in GST. The filing process involves choosing the QRMP option on the GST portal, making monthly tax payments through the Fixed Sum Method (FSM) or Self-Assessment Method (SAM), and ensuring quarterly return submissions through Form GSTR-3B. Additionally, taxpayers must furnish outward supplies through the Invoice Furnishing Facility (IFF) to pass on Input Tax Credit (ITC) to their buyers. This step-by-step approach minimizes the administrative burden and enhances compliance efficiency.

However, businesses often encounter difficulties while adhering to the QRMP scheme in the GST compliance guide. Challenges such as incorrect tax calculations, late payments, and discrepancies in ITC claims can lead to penalties or notices from tax authorities. Proper bookkeeping, timely payment reminders, and software integration for GST filing can help mitigate such issues. Taxpayers must also be aware of recent modifications and technological upgrades in the GST portal that may affect compliance requirements.

Another critical aspect is recognizing the Common errors in the QRMP scheme. Many businesses fail to correctly estimate their tax liability, leading to short payments or excess payments that require future adjustments. Additionally, improper use of the Invoice Furnishing Facility (IFF) may impact ITC claims for their buyers, creating disputes and compliance hurdles. Avoiding these common mistakes ensures seamless tax management and prevents unnecessary legal complications.

With the QRMP scheme in GST gaining traction among small businesses, it is imperative to stay informed about the Latest updates on the QRMP scheme, understand the QRMP scheme in GST exemption criteria, follow the correct process on how to file the QRMP scheme in GST, adhere to the QRMP scheme in the GST compliance guide, and avoid the Common errors in the QRMP scheme. This article will provide a comprehensive overview of these aspects, equipping businesses with the knowledge to optimize their GST compliance under this scheme.

Also Read: Everything You Need to Know About the GST Composition Scheme

What is the QRMP Scheme in GST?

The QRMP scheme in GST stands for the Quarterly Return Filing and Monthly Payment of Taxes scheme. It was introduced by the Central Board of Indirect Taxes and Customs (CBIC) to ease the compliance burden on small taxpayers. Under the QRMP scheme in GST, taxpayers with an annual turnover of less than Rs. 5 crore can file their GST returns on a quarterly basis while making monthly tax payments.

This scheme offers several advantages, such as reduced frequency of filing returns and simplified tax payment processes. The taxpayer is required to file GSTR-3B on a quarterly basis and make monthly payments through PMT-06 using two different methods: the Fixed Sum Method (FSM) or the Self-Assessment Method (SAM).

What are the Latest updates on the QRMP scheme?

The Latest updates on the QRMP scheme provide more clarity about the filing procedures and payment methods for taxpayers opting into the scheme. Recent changes include:

1. Deemed Option for Filing GSTR-3B: From January 2021, taxpayers are deemed to have opted for quarterly filing based on their previous filing frequency.
2. Invoice Furnishing Facility (IFF): This optional facility allows taxpayers to upload invoices for the first two months of each quarter, making the quarterly filing process more manageable.

What Are The QRMP Scheme in GST Exemption Criteria?

The QRMP scheme in GST exemption criteria defines the eligibility requirements for taxpayers to opt into this scheme. Key points include:

1. Eligibility: The scheme is available to taxpayers whose aggregate turnover in the preceding financial year does not exceed Rs. 5 crore.
2. Ineligibility: If the taxpayer’s turnover exceeds Rs. 5 crore during any quarter in the current financial year, they will no longer be eligible to file under the QRMP scheme from the next quarter.
3. Other Exemptions: Certain categories of taxpayers, such as non-resident taxable persons, and taxpayers under the composition scheme, are not eligible to avail of the benefits of the QRMP scheme in GST.

How to File the QRMP Scheme in GST?

Filing under the QRMP scheme in GST involves several steps. Below is a detailed guide on how to file the QRMP scheme in GST:

1. Opting for the Scheme
   To begin with, eligible taxpayers must opt for the QRMP scheme in GST. They can do so on the GST portal between the 1st of the second month of the preceding quarter and the last day of the first month of the quarter. For instance, for the April-June quarter, the option must be exercised between 1st February and 30th April.
   
2. Filing GSTR-3B Quarterly
   Once opted, the taxpayer is required to file GSTR-3B quarterly. The QRMP scheme in GST simplifies the filing process as GSTR-3B is filed quarterly, which significantly reduces the compliance burden compared to the monthly filing.
   
3. Invoice Furnishing Facility (IFF)
   Taxpayers opting for the QRMP scheme in GST can use the Invoice Furnishing Facility to upload B2B invoices on a monthly basis. This helps in the timely reporting of sales data for the first two months of the quarter, easing the quarterly GSTR-1 filing.
   
4. Making Monthly Payments
   Even though the returns are filed quarterly, the payment of taxes is done monthly using the PMT-06 form. Taxpayers have two options: the Fixed Sum Method (FSM) or the Self-Assessment Method (SAM).
   

QRMP Scheme in the GST Compliance Guide

The QRMP scheme in the GST compliance guide is crucial for ensuring smooth compliance with the rules and avoiding penalties. Here are the essential compliance steps:

1. Monthly Tax Payments
   Taxpayers must pay their GST liability for the first two months of the quarter using the PMT-06 challan. The amount can either be pre-filled using the Fixed Sum Method (35% of the previous quarter’s tax liability) or manually calculated using the Self-Assessment Method.
   
2. Quarterly GSTR-3B Filing
   The final GSTR-3B for the quarter must be filed by the 22nd or 24th of the following month, depending on the state or Union Territory.
   
3. Use of Invoice Furnishing Facility (IFF)
   For taxpayers who need to report B2B transactions, the IFF allows them to upload invoices in real time. These invoices are considered for the generation of GSTR-2A, which is essential for the recipient businesses.
   
4. Claiming Input Tax Credit (ITC)
   ITC can be claimed based on GSTR-2B. Taxpayers should ensure that the ITC claims align with the data available in their GSTR-2B and GSTR-1 to avoid discrepancies.
   

What Are The Common Errors in the QRMP scheme?

While filing under the QRMP scheme in GST, taxpayers may encounter common errors. Below are some of the Common errors in the QRMP scheme:

1. Incorrect Payment Method
   A frequent mistake is choosing the wrong method for tax payment. The Fixed Sum Method (FSM) is pre-filled with 35% of the previous quarter’s tax, but taxpayers must ensure that the correct method is used, whether FSM or SAM.
   
2. Failure to File GSTR-3B on Time
   Late filing of GSTR-3B can result in penalties. Ensure that the quarterly return is filed within the stipulated due dates (22nd or 24th).
   
3. Failure to Upload B2B Invoices via IFF
   Missing out on uploading invoices in the IFF for the first two months of the quarter can lead to reporting discrepancies.
   
4. Inaccurate ITC Claims
   Errors in claiming ITC can arise when taxpayers fail to reconcile the data between their GSTR-2B and GSTR-1, which may lead to compliance issues.
   
5. Not Updating GSTIN Details
   Businesses should ensure that their GSTIN details are correctly updated in the portal. Incorrect information can lead to discrepancies in quarterly filings.

We should keep in mind these Common errors in the QRMP scheme

What Are The Tax Payment Methods Under the QRMP Scheme?

There are two methods for paying taxes under the QRMP scheme in GST:

1. Fixed Sum Method (FSM)
   The Fixed Sum Method, also known as the 35% challan method, requires taxpayers to pay 35% of the tax paid in cash during the preceding quarter. This method simplifies the monthly payment process for taxpayers.
   
2. Self-Assessment Method (SAM)
   Under the Self-Assessment Method, the taxpayer calculates their tax liability based on inward and outward supplies and pays the tax accordingly. SAM offers greater flexibility but requires careful calculation.
   

Some Important Due Dates Under the QRMP Scheme in GST

For taxpayers under the QRMP scheme in GST, the due dates for filing and tax payment are crucial:

1. GSTR-3B Filing
   The quarterly GSTR-3B must be filed by the 22nd or 24th of the month following the end of the quarter, based on the taxpayer’s state.
   
2. Tax Payment Using PMT-06
   Tax payments should be made monthly through PMT-06 by the 25th of the following month. The taxpayer has to select either the FSM or SAM method for making the payment.
   

Conclusion

The QRMP scheme in GST is a game-changer for small taxpayers, offering a simplified and flexible approach to tax compliance. By allowing businesses to file GST returns quarterly while making tax payments monthly, the scheme reduces administrative burdens and ensures smoother tax management. However, to fully leverage its benefits, taxpayers must have a clear understanding of eligibility criteria, filing procedures, payment mechanisms, and compliance guidelines. Missteps such as incorrect filing missed deadlines, or miscalculations can lead to penalties and disruptions in business operations.

Staying updated with the latest amendments in the QRMP scheme in GST is crucial, as the government frequently introduces changes to enhance efficiency and ease compliance. To navigate the complexities seamlessly, businesses can rely on expert assistance from RegisterKaro, which provides end-to-end support, from GST registration and return filing to compliance audits and advisory services.

Ready to get started? Reach out to trusted platforms like RegisterKaro and make your compliance journey hassle-free, allowing you to focus on what truly matters—growing your business. Contact our support team at support@registerkaro.in today!

Frequently Asked Questions (FAQs)

1. What is the QRMP scheme in GST?
A: The QRMP scheme in GST allows taxpayers with a turnover of up to Rs. 5 crore to file GSTR-3B quarterly and make monthly tax payments.

2. How do I stay updated on the QRMP scheme in GST?
A: Check the GST portal for the Latest updates on the QRMP scheme, including filing changes, deadline extensions, and the Invoice Furnishing Facility (IFF).

3. What is the QRMP scheme in GST exemption criteria?
A: The scheme is available for businesses with a turnover up to Rs. 5 crore. Exceeding this threshold in a quarter makes the taxpayer ineligible for the next quarter.

4. How do I file under the QRMP scheme in GST?
A: Opt for quarterly filing on the GST portal, file GSTR-3B quarterly, and make monthly tax payments via PMT-06. Use the IFF to upload invoices for the first two months.

5. What common errors should I avoid in the QRMP scheme in GST?
A: Avoid errors like incorrect payment methods, late GSTR-3B filings, and missed invoice uploads using the IFF.

6. How do I manage tax payments under the QRMP scheme in GST?
A: Pay taxes via the Fixed Sum Method (FSM) or Self-Assessment Method (SAM) each month through the PMT-06 form.

7. When is the due date for filing quarterly GSTR-3B under the QRMP scheme in GST?
A: The due date for filing quarterly GSTR-3B is the 22nd or 24th of the month following the quarter, based on the state.