Quarterly Return Filing of Taxes (QRMP) Scheme

Bio

Sandipan Mitra is the CEO and co-founder of Pice. He boasts eight years of experience in the B2B and fintech sector. Sandipan's journey includes significant roles at multiple Indian Unicorns Including Product at PayU, and as founding member / VP, Product at Open Financial Technologies.

5 Sep 24
10 mins

Sandipan Mitra

08 Mins
05-09-24

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Table of Contents

Understanding the QRMP Scheme
Importance of the QRMP Scheme
Steps to Enrol in the QRMP Scheme
QRMP Filing Deadlines
Tax Payment Process under the QRMP Scheme
The Bottom Line

The QRMP scheme allows small businesses with turnover up to ₹5 crores to file GST returns quarterly, reducing the compliance burden.
Under the QRMP scheme, businesses can pay taxes monthly while filing GSTR-1 and GSTR-3B returns quarterly.
The scheme offers two payment methods: Fixed Sum (35% of previous tax) and Self-Assessment, providing flexibility in tax management.
Timely filing of quarterly GST returns is crucial to avoid penalties, with deadlines varying based on the business location.
Newly registered taxpayers can opt for the QRMP scheme starting from the next quarter, depending on the month of registration.

The Quarterly Return of Tax Filing (QRMP) process is a great initiative to make GST return filing easy, ensuring business compliance. The scheme is designed for small taxpayers, allowing them to file their GST returns quarterly instead of monthly.

It further simplifies the process and helps companies better meet their tax obligations. Knowing the quarterly GST return due dates is important to prevent penalties and guarantee timely returns. In this blog, we will discuss the importance of the QRMP process and provide important tips for effective tax filing.

Understanding the QRMP Scheme

The Quarterly Return Filing and Monthly Payment of Taxes, also known as the QRMP Scheme, is a GST initiative that was introduced by the Indian government starting on January 1, 2021, to ease compliance for registered taxpayers through the quarterly GST return due date.

Thus, businesses whose annual turnover is up to ₹5 crores are now eligible to file GSTR-1 and GSTR-3B returns every three months instead of doing it monthly as per previous rules. However, they can still pay their taxes monthly through a simple challan. This scheme was introduced so that the compliance burden would be reduced while making business operations run smoothly without the headache of complex compliance.

Importance of the QRMP Scheme

Here is why the QRMP scheme is important for taxpayers, especially business owners:

Small business owners should know about this scheme as it can help to reduce the number of returns they need to file each year.
Another benefit is that the QRMP scheme reduces the financial burden on small business taxpayers by offering relief on interest and late fees for delayed submissions.
You can also use the Invoice Furnishing Facility (IFF) which is optional in order to file four GSTR-1 returns on an annual basis and upload invoices for the first two months of each quarter instead of waiting until the end. This helps your buyers claim Input Tax Credit (ITC) more quickly.

Eligibility Criteria for the QRMP Scheme

If you are new to tax registration, have just registered or are leaving the Composition Scheme, you can still select the QRMP scheme. You are eligible for the QRMP scheme only under the following conditions:

You can use this option only if you need to file Form GSTR-1 and Form GSTR-3B returns.
Also, you need to file your last due GSTR-3B.
Your aggregate income must be ₹5 crore or less in the previous financial year. If your turnover exceeds this threshold, it will not be eligible for the scheme in the following quarter.
You should not have any saved data in Form GSTR-1 at the time of opting for the scheme. After deleting the reserved information in Form GSTR-1, you can opt for the scheme.

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Steps to Enrol in the QRMP Scheme

Here are the steps to opt for the QRMP scheme:

Step 1: Log in to the GST portal.

Step 2: Go to ‘Services’ > ‘Returns’.

Step 3: Select ‘Opt-in for Quarterly Return’.

Step 4: Choose the option to opt in for quarterly returns.

For Previously Registered Taxpayers:

In case your annual turnover was up to ₹5 crores for FY 2019-20, you filed your GSTR-3B for October 2020 by November 30th, 2020, then you would be auto-migrated to the QRMP scheme for the January-March 2021 quarter.

Now, depending on the turnovers in the current financial year, a quarterly or monthly GST return filing option will be assigned. However, if you have not been transferred automatically you can enrol for the scheme once you meet the eligibility criteria.

In the current financial year:

If your turnover is Rs.1.5 crores or less and you have filed GSTR-1 on a quarterly basis, you will be given the option to file GST returns on a quarterly basis.
If your aggregate turnover is up to ₹1.5 crores and you filed GSTR-1 on a monthly basis, you will be assigned the GST monthly return option.

For the preceding financial year:

If your aggregate turnover was between ₹1.5 - 5 crores, you will be assigned the GST quarterly return option.

For Newly Registered Taxpayers:

If you have registered during the first month of an entire quarter, you can opt for the QRMP scheme. However, if your registration has occurred in the second or third month of the quarter then you can only opt for the QRMP scheme starting from the next quarter.

For instance, if you register in April for the April-June 2024 quarter, you can avail yourself the QRMP scheme immediately. However, if you register in May or June, you will need to file GSTR-1 and GSTR-3B monthly until the next quarter.

QRMP Filing Deadlines

The deadlines for submitting GST refund applications will vary based on the particular refund category. The GST return filing dates from time to time are announced through different channels.

Based on those refund categories, for 2024, the essential GST calendar dates for filing returns under QRMP:

For taxpayers with an annual turnover of up to ₹5 crore opting for the QRMP scheme:

Quarterly Filing:

For April-June 2024:

Category X states/UTs: 22nd July 2024
Category Y states/UTs: 24th July 2024

For July-September 2024:

Category X states/UTs: 22nd October 2024
Category Y states/UTs: 24th October 2024

GSTR-1 Filing Deadlines

For taxpayers with an aggregate turnover of up to ₹5 crore opting for quarterly filing the time limits are:

April-June 2024: 13th July 2024
July-September 2024: 13th October 2024

GSTR-3B Filing Calendar

April 2024: 20th May 2024
May 2024: 20th June 2024
June 2024: 20th July 2024
July 2024: 20th August 2024
August 2024: 20th September 2024
September 2024: 20th October 2024

Tax Payment Process under the QRMP Scheme

The Tax Payment Process under the Quarterly Return Filing and Monthly Payment (QRMP) Scheme is designed to simplify tax payments for small business taxpayers. If you are enrolled in this scheme, you will need to pay taxes for the first two months of each quarter using Form PMT-06, which generates a payment challan. The payment time limit for each month is the 25th of the next month.

You have two types of return filing processes for making these payments:

Fixed Sum Method

Taxpayers can settle their monthly tax liability using the Fixed Sum Method or FSM, also known as the 35% challan method, by paying 35% of the previous quarter's tax if filed quarterly, or the last month's tax if filed monthly.

If you filed your last GSTR-3B return quarterly, you can opt for a pre-filled challan that calculates 35% of the tax that was done as a cash payment during the previous quarter.
In the case of monthly filing of GSTR-3B, the pre-filled challan will reflect the full tax amount paid in cash for the last month of the previous quarter.
However, if you are a new taxpayer, have not filed your last GSTR-3B, or recently opted out of the Composition Scheme, this 35% option will not be available.

Self-Assessment Method:

This method allows you to calculate and pay the actual tax due based on your inward and outward supplies while you claim the Input Tax Credit (ITC) that is available.

The taxes you pay during the initial two months can be used to offset any liability when you file your quarterly GSTR-3B return. This system offers flexibility and helps manage your tax payments efficiently.

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The Bottom Line

It is comparatively easier to comply with GST regulations when you understand how the tax payment takes place under QRMP. Effective management of your tax liabilities will then be possible by applying an appropriate payment method, Fixed Sum or Self-Assessment. Do ensure that you note down the quarterly GST return due date to file within time and save yourself from penalty.

This will not only make tax management easier but also help keep you up to date with GST compliance so that your business practices are on track along with managing the cash flows.

FAQs

Who is eligible to file a quarterly GST return?

Businesses with an annual aggregate turnover of up to ₹5 crores in the preceding financial year are eligible to opt for quarterly GST return filing under the QRMP (Quarterly Return Monthly Payment) scheme. This scheme allows eligible taxpayers to file GSTR-3B and GSTR-1 returns on a quarterly basis while making tax payments monthly. The option to file quarterly returns is aimed at reducing the compliance burden for small and medium enterprises.

What is the due date for the QRMP scheme?

Under the QRMP scheme, the due date for filing the GSTR-3B return on a quarterly basis is either the 22nd or 24th of the month following the quarter, depending on the location of the principal place of business. For example, businesses in certain states have a due date of the 22nd, while others have until the 24th. However, taxpayers must make monthly tax payments using form GST PMT-06 by the 25th of the following month for the first two months of the quarter.

How to select quarterly return in GST?

To select the quarterly return option in the GST portal, log in with your credentials and navigate to the 'Services' tab. From there, go to 'Returns' and choose the 'Opt-in for Quarterly Returns' option. You can then select the relevant financial year, choose the quarterly filing option, and confirm your selection. Ensure that your aggregate turnover is within the ₹5 crore limit to be eligible for this option.

What is the time limit for opting QRMP scheme?

The time limit for opting into the QRMP scheme is typically before the start of the quarter for which the taxpayer wants to file returns quarterly. The GST portal usually opens a window at the beginning of each quarter, allowing taxpayers to switch from monthly to quarterly returns. Once selected, the option remains valid until you change it or your eligibility criteria change.

Is GST quarterly return limit 5 crore?

Yes, the eligibility threshold for filing quarterly GST returns under the QRMP scheme is ₹5 crores in annual aggregate turnover in the preceding financial year. Businesses with turnover up to this limit can choose to file their GSTR-1 and GSTR-3B returns quarterly, while those exceeding this threshold must continue with monthly filings.

Can we file GST refund quarterly?

While GST returns can be filed quarterly under the QRMP scheme, GST refunds must be claimed based on the filing of GSTR-3B and other relevant forms. The refund process is generally linked to the return filing cycle, so even if you are on a quarterly return cycle, you may need to file for a refund within the monthly or quarterly periods, depending on your specific situation and eligibility.

What is the penalty for filing GST quarterly return late?

If you file your quarterly GST return late under the QRMP scheme, a late fee and interest charges will apply. The late fee is ₹50 per day for normal taxpayers (₹25 each for CGST and SGST) or ₹20 per day for taxpayers with nil returns (₹10 each for CGST and SGST). Additionally, interest at the rate of 18% per annum is charged on the outstanding tax amount from the due date until the actual payment date. The late fee can accumulate up to a maximum of ₹5,000 per return.