In this article, we are discussing the new Quarterly Return Monthly Payment (QRMP) Scheme and explained with the help of practical illustrations.
1. Who are Registered Persons Eligible for this QRMP Scheme?
A registered person who is required to furnish a return in FORM GSTR-3B, and who has an aggregate turnover of up to 5 crore rupees in the preceding financial year, is eligible for the QRMP Scheme.
The aggregate annual turnover for the preceding financial year shall be calculated in the common GSTN portal taking into account the details furnished in the returns by the taxpayer for the tax periods in the preceding financial year. This new Scheme will be effective from 01.01.2021.
Further, in case the aggregate turnover exceeds 5 crore rupees during any quarter in the current financial year, the registered person shall not be eligible for the Scheme from the next quarter.
2. How Registered Person Can Opt for QRMP Scheme?
The eligible registered persons i.e. dealers having an annual aggregate turnover of up to 5 crore rupees in the previous financial year, can opt-in for the QRMP Scheme, for “any quarter of the current financial year, from the first day of the second month of preceding quarter to the last day of the first month of the quarter”.
In order to exercise this option, the registered person must have furnished the last return, as due on the date for opting this scheme.
Registered persons are not required to exercise the option every quarter. Where such option has been exercised once, they shall continue to furnish the return as per the selected option for future tax periods, unless they revise the said option.
The facility to avail the QRMP Scheme would be available through-out the year, in the common GSTN portal.
3. What is the criteria for determining the threshold annual turnover limit under this scheme?
The option to avail the QRMP Scheme is GSTIN wise and therefore, distinct persons as defined in Section 25 of the CGST Act (different GSTINs on same PAN) have the option to avail the QRMP Scheme for one or more GSTINs. In other words, some GSTINs for that PAN can opt for the QRMP Scheme and remaining GSTINs may not opt for the Scheme.
4. How will the Transition to the New QRMP Scheme take place from the Existing Monthly Return Filing Regime?
Default Migration: For the first quarter of the Scheme i.e. for the quarter January, 2021 to March, 2021, in order to facilitate the taxpayers, the default migration facility is being enabled and it has been provided that all the registered persons, whose aggregate turnover for the FY 2019-20 is up to 5 crore rupees and who have furnished the return in FORM GSTR-3B for the month of October, 2020 by 30th November, 2020, shall be migrated on the common portal, as below
Therefore, taxpayers are advised to furnish the return of October, 2020 in time so as to be eligible for default migration. The taxpayers who have not filed their return for October, 2020 on or before 30th November, 2020 will not be migrated to the Scheme. They will be able to opt for the Scheme once the FORM GSTR-3B as due on the date of exercising option has been filed.
Above default option has been provided for the convenience of registered persons based on their anticipated behaviour. However, such registered persons are free to change the option as above, if they so desire, from 5th of December, 2020 to 31st of January, 2021.
In case the aggregate turnover exceeds 5 crore rupees during any quarter in the current financial year, the registered person shall not be eligible for the Scheme from the next quarter. Such registered person, whose aggregate turnover crosses 5 crore rupees during a quarter in current financial year, shall opt for furnishing of return on a monthly basis, electronically, on the common portal, from the succeeding quarter. The facility for opting out of the Scheme for a quarter will be available from first day of second month of preceding quarter to the last day of the first month of the quarter.
5. What is the New Invoice Furnishing Facility (IFF) under QRMP Scheme?
In the existing framework i.e. pre-QRMP regime also, the registered persons having an aggregate annual turnover of upto Rs. 1.5 crores have been given an option of filing their quarterly GSTR-1 & GSTR 3B Returns. However, on practical considerations, such registered persons are not able to avail this benefit of quarterly return filing, due to the non-reflection of the corresponding ITC in GSTR 2A/2B of their respective recipients of goods or services. Such recipients of goods or services, including some big corporates or dealers, have become reluctant to purchase their goods or services from such small registered persons who have opted for filing quarterly GST Returns, due to the non-reflection of their corresponding ITC in their GSTR 2A/2B, and as such this benefit of filing quarterly GST Return, has somehow become redundant.
In order to do away with the similar practical difficulty, in the post-QRMR regime, an Invoice Furnishing Facility (IFF) is being enabled in the GSTN portal.
The registered persons opting for the QRMP Scheme would be required to furnish the details of outward supply in FORM GSTR-1 quarterly as per the rule 59 of the CGST Rule.
For each of the first and second months of a quarter, such a registered person will have the facility (Invoice Furnishing Facility- IFF) to furnish the details of such outward supplies to a registered person, as he may consider necessary, between the 1st day of the succeeding month till the 13th day of the succeeding month. The said details of outward supplies shall, however, not exceed the value of fifty lakh rupees in each month. It may be noted that after 13th of the month, this facility for furnishing IFF for previous month would not be available. As a facilitation measure, continuous upload of invoices would also be provided for the registered persons wherein they can save the invoices in IFF from the 1st day of the month till 13th day of the succeeding month. The facility of furnishing details of invoices in IFF has been provided so as to allow details of such supplies to be duly reflected in the FORM GSTR-2A and FORM GSTR-2B of the concerned recipient.
6. How and in what manner the Monthly Payment of Taxes is to be made under QRMP Scheme?
The registered person under the QRMP Scheme would be required to pay the tax due in each of the first two months of the quarter by depositing the due amount in FORM GST PMT-06, by the twenty fifth day of the month succeeding such month. While generating the challan, taxpayers should select “Monthly payment for quarterly taxpayer” as reason for generating the challan. The said person can use any of the following two options provided below for monthly payment of tax during the first two months –
(a) Fixed Sum Method: A facility is being made available on the portal for generating a pre-filled challan in FORM GST PMT-06 for an amount equal to thirty-five per cent of the tax paid in cash in the preceding quarter where the return was furnished quarterly; or equal to the tax paid in cash in the last month of the immediately preceding quarter where the return was furnished monthly.
Monthly tax payment through this method would not be available to those registered persons who have not furnished the return for a complete tax period preceding such month. A complete tax period means a tax period in which the person is registered from the first day of the tax period till the last day of the tax period.
(b) Self-Assessment Method: The Registered Persons, can also pay the tax due by considering the tax liability on inward and outward supplies and the input tax credit available, in FORM GST PMT-06. In order to facilitate ascertainment of the ITC available for the month, an auto-drafted input tax credit statement has been made available in FORM GSTR- 2B, for every month.
In case the balance in the electronic cash ledger and/or electronic credit ledger is adequate for the tax due for the first month of the quarter or where there is nil tax liability, the registered person may not deposit any amount for the said month. Similarly, for the second month of the quarter, in case the balance in the electronic cash ledger and/or electronic credit ledger is adequate for the cumulative tax due for the first and the second month of the quarter or where there is nil tax liability, the registered person may not deposit any amount.
Any claim of refund in respect of the amount deposited for the first two months of a quarter for payment of tax will be permitted only after the return in FORM GSTR-3B for the said quarter has been furnished. Further, this deposit cannot be used by the taxpayer for any other purpose till the filing of return for the quarter.
7. Has any New Form for Filing Quarterly Return under QRMP Scheme, been prescribed?
Under the QRMP Scheme, No New Return Form has been prescribed. The registered persons would be required to furnish their quarterly returns in FORM GSTR-3B, for each quarter, on or before 22nd or 24th day of the month succeeding such quarter. In FORM GSTR-3B, they shall declare the supplies made during the quarter, ITC availed during the quarter and all other details required to be furnished therein. The amount deposited by the registered person in the first two months shall be debited solely for the purposes of offsetting the liability furnished in that quarter’s FORM GSTR-3B. However, any amount left after filing of that quarter’s FORM GSTR-3B may either be claimed as refund or may be used for any other purpose in subsequent quarters. In case of cancellation of registration of such person during any of the first two months of the quarter, he is still required to furnish return in FORM GSTR-3B for the relevant tax period.
8. How and in what manner, the Interest for making Delayed Payment of tax, be calculated under QRMP Scheme?
Interest for making Delayed Payment of tax be calculated under QRMP Scheme will be calculated as under:
A. For registered person making payment of tax by opting Fixed Sum Method
i) No interest would be payable in case the tax due is paid in the first two months of the quarter by way of depositing auto-calculated fixed sum amount as detailed in para 6.1(a) above by the due date. In other words, if while furnishing return in FORM GSTR-3B, it is found that in any or both of the first two months of the quarter, the tax liability net of available credit on the supplies made /received was higher than the amount paid in challan, then, no interest would be charged provided they deposit system calculated amount for each of the first two months and discharge their entire liability for the quarter in the FORM GSTR-3B of the quarter by the due
ii) In case such payment of tax by depositing the system calculated amount in FORM GST PMT-06 is not done by due date, interest would be payable at the applicable rate, from the due date of furnishing FORM GST PMT-06 till the date of making such payment.
Further, in case FORM GSTR-3B for the quarter is furnished beyond the due date, interest would be payable as per the provisions of Section 50 of the CGST Act for the tax liability net of ITC.
B. For registered person making payment of tax by opting Self-Assessment Method Interest amount would be payable as per the provision of Section 50 of the CGST Act for tax or any part thereof (net of ITC) which remains unpaid / paid beyond the due date for the first two months of the quarter.
Interest payable, if any, shall be paid through FORM GSTR-3B.
9. How and in what manner Late Fees for furnishing quarterly Return under QRPM Scheme will be levied?
Applicability of Late Fee – Late fee is applicable for delay in furnishing of return/details of outward supply as per the provision of Section 47 of the CGST Act. As per the Scheme, the requirement to furnish the return under the proviso to Section 39(1) of the CGST Act is quarterly. Accordingly, late fee would be the applicable for delay in furnishing of the said quarterly return/details of outward supply. No late fee is applicable for delay in payment of tax in first two months of the quarter.
10. Can a registered person switch back to the option of filing monthly return once he has opted for QRMP Scheme?
Yes, a registered person can switch back to the option of filing monthly return once he has opted for QRMP Scheme. The facility for opting out of the Scheme for a quarter will be available from first day of second month of preceding quarter to the last day of the first month of the quarter.
Disclaimer: In this document Nothing contained is to be construed as a legal opinion or view of either of the authors whatsoever and the content is to be used strictly for educative purposes only.
Tags: Goods and Services Tax, GST, GST Rules,
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