QRMP scheme
A Summary of the QRMP Scheme
In this post, we will discuss the QRMP (Quarterly Returns with Monthly Payments) Scheme under GST, designed to simplify compliance for small taxpayers. We will cover its key features, benefits, eligibility criteria, and how to avail the scheme. Whether you are looking to reduce your filing burden or streamline your tax payments, this blog will help you understand everything about QRMP and its importance for small businesses.
Let’s look at each section:
- What is the QRMP Scheme?
- Why is the QRMP Scheme Important?
- Eligibility to QRMP Scheme under GST
- Deemed monthly/quarterly filing of GSTR-3B
- How to avail the QRMP Scheme
- When to avail the QRMP scheme and submit returns
- Payment Process of QRMP scheme
- Interest under QRMP Scheme
- Late fee under QRMP scheme
- Issues or Challenges under QRMP
- FAQs
What is the QRMP Scheme?
The Indian government introduced the QRMP (Quarterly Returns with Monthly Payments) Scheme to simplify compliance for small taxpayers. It allows them to file GSTR-1 and GSTR-3B returns every quarter while making monthly GST payments, easing their overall compliance burden.
Why is the QRMP Scheme Important?
Here are the major benefits of opting for the QRMP scheme:
- It reduces the taxpayer’s burden by cutting down GST return filings from 12 GSTR-3Bs to just four annual returns.
- Taxpayers can join or leave the scheme anytime during the year without restrictions.
- It allows easy monthly tax payments through self-assessment and pre-filled challans in the first two months of each quarter.
- You can also enjoy flexible invoicing, filing 4 GSTR-1s yearly while uploading invoices and claiming input tax credits in the first two months of each quarter.
- The scheme lowers compliance costs by shifting from monthly to quarterly assessments.
Eligibility to QRMP Scheme under GST
The Quarterly Returns with Monthly Payment (QRMP) scheme simplifies GST compliance for small taxpayers. Here are the eligibility criteria:
- Annual turnover should not exceed Rs. 5 crores.
- The taxpayer must not be a non-resident taxable person, casual taxable person, or Input Service Distributor.
- The taxpayer should not supply goods through an e-commerce operator, who must collect tax at the source under Section 52 of the CGST Act.
- The taxpayer should have opted for something other than the Composition Scheme under Section 10 of the CGST Act.
- All previous GSTR-1 and GSTR-3B returns must be filed before opting for the QRMP scheme.
Once eligible, taxpayers can file GSTR-1 and GSTR-3B quarterly, with monthly GST payments. The scheme helps small taxpayers by reducing their compliance load, giving them more time to focus on their business.
Deemed monthly/quarterly filing of GSTR-3B
Taxpayers must follow the procedure mentioned above to opt for quarterly GSTR-3B filing. However, for registered persons listed in the table below who filed their GSTR-3B for October 2020 by November 30th, 2020, it will be considered that they have chosen either monthly or quarterly filing, as shown below:
- Registered persons with turnover up to Rs.1.5 crore and filing GSTR-1 quarterly: Deemed to file GSTR-3B quarterly.
- Registered persons with turnover up to Rs.1.5 crore and filing GSTR-1 monthly: Deemed to file GSTR-3B monthly.
- Registered persons with turnover between Rs.1.5 crore and Rs.5 crore in the last financial year: Deemed to file GSTR-3B quarterly.
Taxpayers in Category 2 could have changed their option to quarterly GSTR-3B filing between December 5th, 2020, and January 31st, 2021.
How to avail the QRMP Scheme
Log in to the GST portal:
- Go to Login >> Services >> Returns.
- Select Opt-in for quarterly return.
If you are a previously registered taxpayer:
Imagine your annual turnover was up to INR 5 crores in the financial year 2019-20 and you filed your GSTR-3B return for October 2020 by November 30th, 2020, you were automatically moved to the QRMP scheme for the January-March 2021 quarter. You will be assigned a specific return option for this period.
For the current financial year:
- If your turnover is up to INR 1.5 crores and you filed GSTR-1 quarterly, you’ll be placed on the GST quarterly return option.
- If you filed GSTR-1 monthly, you’ll be placed on the GST monthly return option.
For the previous financial year:
- If your turnover was between INR 1.5 crores and 5 crores, you’ll be assigned the GST quarterly return option.
When you are a registered taxpayer but haven’t been migrated, you can opt for the scheme if you meet the criteria.
If you are a newly registered taxpayer:
If you register in the first month of a quarter, you can opt for the QRMP scheme for that quarter. However, if your registration is in the second or third month, you can only choose QRMP from the next quarter.
For example, if you are registered in April (for the April-June quarter), you can opt for QRMP. But if you are registered in May or June, you can only use QRMP for that quarter and must file GSTR-1 and GSTR-3B monthly in the next quarter.
When to avail the QRMP scheme and submit returns
Taxpayers can choose to opt in or out of the QRMP scheme for a quarter from the 1st of the month before the quarter starts to the last day of the first month of the quarter.
For example, if you want to opt in for the April-June quarter, you can do between February 1st and April 30th.
The GSTR-3B return must be filed by the 22nd-24th of the following month. Before opting for the QRMP scheme, you need to file your last GSTR-3B, which would be due by April 22-24 for the March return. If you opt out of the QRMP scheme, you must submit GSTR-1 and GSTR-3B monthly.
Payment Process of QRMP scheme
- Fixed Sum Method:
- If you file GSTR-3B quarterly, you can get a pre-filled challan with 35% of the previous quarter’s tax.
- For monthly filers, the challan will show the full tax amount from the last month of the previous quarter.
- New taxpayers or those who recently left the composition scheme cannot access the 35% challan.
- Self-Assessment Method:
- You can pay the actual tax due based on your outward and inward supplies and available ITC.
- The tax paid in the first two months can be adjusted against your GSTR-3B for the quarter.
Interest under QRMP Scheme
The interest will be applicable as follows if the taxpayer chooses one of the following methods:
Interest on Tax Payment: Fixed Sum Method (FSM or 35% Challan Method)
| SL.NO | Scenario | Interest to be paid |
| 1 | If the pre-filled GST PMT-06 tax liability is paid by the 25th of the following month | No interest. |
| 2 | If the tax liability in GST PMT-06 is not paid by the 25th of the following month | 18% interest will be charged from the 26th until payment is made. |
| 3 | If the final tax liability for the first two months is equal to or less than the amount paid in GST PMT-06 | No interest. |
| 4 | If the final tax liability is higher but the extra amount is paid by the GSTR-3B due date | No interest. |
| 5 | If the final tax liability is higher and the extra amount is not paid by the GSTR-3B due date | 18% interest from the GSTR-3B due date (22nd or 24th of the month, depending on the state) until payment is made. |
Interest on Tax Payment: Self-Assessment Method (SAM)
- Taxpayers must pay 18% interest on any unpaid or late-paid net tax liability for the first two months of the quarter.
- For the third month of the quarter, 18% interest is charged on late tax payments, whether using FSM (35% challan method) or SAM.
Late fee under QRMP scheme
| Act | Late fee per day | Late fee per day (for ‘Nil’ tax liability) |
| CGST Act | Rs 25 | Rs 10 |
| SGST Act | Rs 25 | Rs 10 |
| IGST Act | Rs 50 | Rs 20 |
Issues or Challenges under QRMP
Deciding whether to opt for the QRMP scheme or stick with monthly returns for each GSTIN under a business (PAN) can be time-consuming. For businesses using the Invoice Furnishing Facility (IFF) under QRMP, B2B and non-B2B documents must also be separated. B2B invoices are moved to the IFF, while non-B2B documents go directly to the quarterly GSTR-1 return.
This makes reconciling the IFF, sales register, and GSTR-1 crucial. Additionally, taxpayers in the QRMP scheme must choose a monthly tax payment method: the Fixed Sum/35% Challan or the Self-assessment Method.
We have reached the end of this post. Please share your queries with us in the comment section below.
FAQs
1. What are the main features of the QRMP Scheme?
Ans: There is no need to make a monthly deposit if you have no tax liability.
Tax deposited within the first two months of the quarter can be used to modify the liability for the quarter in Form GSTR-3B, but it cannot be used for any other purpose until the quarter’s return is filed.
2. Is there a time limit for QRMP?
Ans: No, there is no time limit for the QRMP. The QRMP plan is available throughout the year and in any quarter. People registered for GST can apply anytime between the first day of the second month before the quarter and the last day of the quarter’s first month.
