Tax Payments under the QRMP Scheme

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Published Date:  05-12-2023   Author:   swati-goyal
captainbiz tax payments under the qrmp scheme

The Quarterly Return Filing and Monthly Payment (QRMP) scheme, a progressive initiative by the Central Board of Indirect Taxes & Customs (CBIC), marks a significant shift in the GST compliance process. Introduced in January 2021, this scheme is tailored for small taxpayers, aimed at reducing their compliance burden. Understanding the QRMP filing procedure is crucial for eligible businesses to benefit from this scheme. This blog serves as a comprehensive QRMP filing guide, outlining the steps to file QRMP and the QRMP submission process, providing a straightforward path for small and medium enterprises to stay compliant within the GST framework.

Understanding the QRMP Scheme

At its core, the QRMP scheme is designed to simplify the GST filing process for smaller businesses. It allows eligible taxpayers to file their GSTR-3B returns quarterly while making tax payments monthly. This balance between less frequent filing and regular tax payments is a cornerstone of the QRMP scheme. By reducing the number of filings from 16 to 8 per year, QRMP considerably eases the compliance workload.

Table: QRMP Scheme Simplification

Filing Under Regular GST Filing Under QRMP Scheme
12 GSTR-3B + 4 GSTR-1 Returns (Total 16) 4 GSTR-3B + 4 GSTR-1 Returns (Total 8)

Eligibility Criteria for QRMP

To leverage the benefits of the QRMP scheme, businesses must first ascertain their eligibility. The scheme is open to registered taxpayers with an aggregate annual turnover of up to Rs.5 crore in the preceding financial year. It’s important to note that exceeding this turnover limit in the current financial year disqualifies taxpayers from continuing in the QRMP scheme.

Table: QRMP Eligibility Criteria

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Eligibility Criterion Requirement
Annual Turnover Up to Rs.5 crore in the preceding FY
Registration Must be a registered taxpayer

Steps to Opt for QRMP Scheme

Opting for the QRMP scheme is a straightforward process, essential for those who wish to simplify their GST compliance. The first step is to log in to the GST portal using your credentials. Navigate to the ‘Services’ section, then to ‘Returns,’ and finally to the ‘Opt-in for Quarterly Return’ option. Here, you can select whether to opt in or out of the QRMP scheme.

Table: Steps to Opt-In/Out of QRMP

Steps Action Required
1 Log in to the GST portal
2 Navigate to ‘Services’ > ‘Returns’
3 Select ‘Opt-in for Quarterly Return’
4 Choose to opt in or opt out of QRMP

Invoice Furnishing Facility (IFF) in QRMP

The Invoice Furnishing Facility (IFF) under the QRMP scheme allows taxpayers to upload invoices monthly, despite the quarterly filing. This facility is particularly useful for uploading B2B invoices, which ensures that your recipients can claim their Input Tax Credit (ITC) timely. Remember, the IFF is only for the first two months of each quarter. This is a key element in the QRMP e-filing steps, allowing for smoother transactions and better credit management for businesses.

Tax Payment Methods under QRMP

When it comes to making tax payments under the QRMP scheme, there are two methods: the Fixed Sum Method (FSM) and the Self Assessment Method (SAM). FSM involves paying a fixed sum based on past tax payments, while SAM requires calculating tax liability based on actual supplies made. Both methods have their specific processes and deadlines, which are integral parts of the QRMP submission process

Detailed QRMP Filing Guide

Filing under the QRMP scheme is a systematic process designed for simplicity and efficiency. Here’s a step-by-step breakdown to guide you through the QRMP filing procedure:

Step 1: Determine Eligibility and Opt-In for QRMP

First, ensure your business is eligible for QRMP, which primarily depends on your annual aggregate turnover. If it’s up to Rs.5 crore, you can opt for this scheme.

  1. Log in to the GST portal.
  2. Navigate to ‘Services’ > ‘Returns’ > ‘Opt-in for Quarterly Return’.
  3. Select ‘Opt-in’ if you meet the criteria.

Step 2: Choose Your Tax Payment Method

For the first two months of each quarter, decide whether to use the Fixed Sum Method (FSM) or the Self Assessment Method (SAM) for tax payments.

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  • FSM involves paying a fixed percentage of your past tax liability.
  • SAM is based on actual supplies made minus input tax credit.

Step 3: Monthly Tax Payment (First Two Months)

Using your chosen method (FSM or SAM), make your tax payments for the first two months of the quarter.

  1. Log in to the GST portal.
  2. Navigate to ‘Services’ > ‘Payments’ > ‘Create Challan’.
  3. Select ‘Monthly payment for quarterly return’ and proceed to make the payment.

Step 4: Invoice Uploading Using IFF (Optional)

If you choose to use the Invoice Furnishing Facility (IFF), upload your B2B invoices monthly for better ITC management.

  1. Access the IFF section on the GST portal.
  2. Upload relevant B2B invoices for the first two months of each quarter.

Step 5: Quarterly Return Filing

At the end of the quarter, file your GSTR-3B and GSTR-1 returns.

  1. Prepare your GSTR-3B and GSTR-1 returns with all the required information.
  2. Ensure accuracy in reporting all transactions for the quarter.
  3. Submit the returns on the GST portal.

Step 6: Final Tax Payment (End of Quarter)

If there is any remaining tax liability, settle it at the time of filing the GSTR-3B return for the quarter.

  • Check for any outstanding tax liability.
  • Create a challan for the remaining amount, if any, and make the payment.

Step 7: Regular Review and Update

Regularly review your eligibility for the QRMP scheme, especially if there are changes in your business turnover.

  • Monitor your turnover each quarter.
  • Update your filing preference on the GST portal if your turnover crosses the Rs.5 crore threshold.

QRMP Submission Process

After completing the initial steps of the QRMP filing process, the submission process for your quarterly returns begins. This crucial stage ensures that your tax liabilities are accurately reported and settled.

Step 1: Preparing for Quarterly Filing

Towards the end of the quarter, start preparing your GSTR-3B and GSTR-1 filings. Gather all necessary documents, including sales and purchase invoices, to ensure accurate reporting.

  • Collect all relevant transaction details for the quarter.
  • Reconcile your books with the GST records to ensure accuracy.

Step 2: Filing GSTR-3B and GSTR-1

File your GSTR-3B and GSTR-1 returns for the quarter on the GST portal. This is a crucial part of the QRMP filing procedure, representing the culmination of your quarterly GST compliance.

  1. Log into the GST portal.
  2. Navigate to the return filing section and select the appropriate quarter for GSTR-3B and GSTR-1.
  3. Fill in the required details, ensuring all data is accurate and complete.

Step 3: Review and Submit Returns

Before submitting, thoroughly review your returns for any discrepancies. This step is critical in the QRMP submission process to avoid future complications.

  • Double-check all entries in GSTR-3B and GSTR-1.
  • Confirm that all taxable transactions for the quarter are accurately reported.

Table: Quarterly GSTR Filing Checklist

Task Description
Document Collection Gather all sales and purchase invoices
Reconciliation Match transactions with GST records
Filing Returns Complete GSTR-3B and GSTR-1 on GST portal
Review Double-check all entries for accuracy
Submission Submit returns after thorough review

Also Read: A Comprehensive Guide: How To File GSTR-3B With Accuracy

Interest and Late Fees in QRMP

Under the QRMP scheme, timely tax payments and filings are crucial to avoid interest and late fees. Interest is charged at 18% per annum for late tax payments and late filing of GSTR-3B. To minimize these charges, it’s essential to follow the QRMP filing procedure diligently and make tax payments by the 25th of the month following each of the first two months of the quarter. Ensure that your final quarterly return is submitted by the due date, typically the 22nd or 24th of the month following the quarter’s end.

Table: Avoiding Interest and Late Fees in QRMP

Action Item Due Date Consequence if Missed
Monthly Tax Payment 25th of following month Interest at 18% per annum
Quarterly Return Filing 22nd/24th of month post-quarter Late fees up to Rs.5,000

Also Read: Penalties And Late Fees For GSTR-3B Filing

Handling Common Issues in QRMP Filing

Encountering issues during the QRMP filing process is not uncommon. Common problems include errors in invoice details, mismatches in ITC claims, or technical glitches on the GST portal. To ensure smooth QRMP submission, regularly reconcile your invoices and maintain accurate records. Use the Invoice Furnishing Facility (IFF) judiciously for accurate B2B invoice reporting. If technical issues arise, refer to the GST portal’s help section or seek assistance from a GST practitioner.

Table: Troubleshooting Common QRMP Filing Issues

Issue Solution
Invoice Mismatches Regular reconciliation and accurate reporting
ITC Claim Discrepancies Careful review of GSTR-2B and IFF entries
Technical Glitches Use GST help resources or professional assistance

Conclusion

Understanding and efficiently implementing the QRMP filing procedure is pivotal for eligible taxpayers to streamline their GST compliance. This guide has walked you through the QRMP submission process, detailing the steps to file QRMP, and providing insights into the QRMP e-filing steps. Remember, the key to successful QRMP compliance lies in timely actions, accurate record-keeping, and staying updated with GST regulations. Follow these best practices to make the most of the QRMP scheme, ensuring your business stays compliant with minimal hassle.

Best Practice Benefit
Timely Filing and Payment Avoids interest and late fees
Accurate Record-Keeping Ensures correct tax liability and ITC claims
Regular Updates on GST Rules Keeps business compliant with latest changes

Also Read: What Is QRMP?

Frequently Asked Questions (FAQs)

  • What is the QRMP filing procedure for new taxpayers?

New taxpayers under the QRMP scheme should first check their eligibility, which is based on their annual turnover. If eligible, they can opt-in through the GST portal. Post opting in, they should follow the quarterly filing schedule for GSTR-3B and GSTR-1, while making tax payments monthly using either the Fixed Sum Method or Self Assessment Method.

  • How do I complete the QRMP submission process?

To complete the QRMP submission process, start by making monthly tax payments for the first two months of the quarter. Then, prepare and file your GSTR-3B and GSTR-1 returns by the end of the quarter. 

  • What are the essential steps to file QRMP?

Essential steps to file QRMP include determining eligibility, opting for the scheme via the GST portal, choosing a tax payment method, making monthly tax payments, using the IFF for B2B invoices, and finally filing GSTR-3B and GSTR-1 returns quarterly.

  • How can small business owners file QRMP?

Small business owners should start by confirming their eligibility for QRMP. Once opted in, they must make tax payments monthly and file GSTR-3B and GSTR-1 quarterly. Utilizing the Invoice Furnishing Facility (IFF) for the first two months each quarter is recommended to manage input tax credits efficiently.

  • What are the QRMP e-filing steps?

QRMP e-filing involves logging into the GST portal, selecting the appropriate form (GSTR-3B or GSTR-1) for the quarter, filling in the details accurately, and submitting the forms online. 

  • How to submit QRMP returns online?

To submit QRMP returns, access the GST portal and navigate to the return filing section. Choose the respective quarter and form (GSTR-3B or GSTR-1), enter all the necessary details, review them thoroughly, and then submit. 

  • What should I do if I face issues during the QRMP filing process?

If issues arise during QRMP filing, first try to identify the problem. Common issues include mismatched invoices or technical glitches. For invoice-related issues, double-check and reconcile your records. For technical issues, consult the GST helpdesk or a professional tax consultant.

  • Are there any tips for smooth QRMP submission?

For smooth QRMP submission, maintain accurate and timely records of all transactions. Regularly reconcile your invoices, especially if using the IFF, and stay aware of the due dates for tax payments and return filings. Proper planning and organization are key.

  • How can I avoid penalties in the QRMP scheme?

Avoid penalties in the QRMP scheme by adhering to the due dates for monthly tax payments and quarterly return filings. Use reminders and GST software tools for timely compliance. Regularly review your tax liabilities to ensure correct and timely payments.

  • What are the advantages of using the QRMP scheme?

The QRMP scheme offers the advantage of reduced filing frequency, easing the compliance burden for small taxpayers. By filing returns quarterly and paying taxes monthly, businesses can manage their cash flow more effectively and have more time to focus on other operational aspects.

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Swati Goyal

Swati Goyal is an experienced financial reporter, who writes on the Australian share market (ASX), as well as global equity movements and trends more broadly. She also covers commodities, currencies, bonds, and the private market space. As a business writer and financial analyst, Swati has also published on FX Empire, TipRanks, Inquisitr, and many more. Swati holds a Bachelor of Commerce. She previously worked as a research analyst and trader at Angel Broking and led an accounts team at Cox & Kings.

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