The Quarterly Return filing and Monthly Payment of Taxes (QRMP) scheme was introduced under GST to reduce the compliance burden for small taxpayers by allowing quarterly return filing with monthly tax payments. While the scheme works well for many businesses, some taxpayers may find that monthly filing better suits their reporting or cash flow needs.
In such cases, opting out of the QRMP scheme becomes necessary. Understanding the process, timelines, and implications of opting out helps avoid compliance issues and missed deadlines. Using reliable GST software can also support businesses in managing return filing and tax tracking efficiently, especially when shifting to monthly compliance.
What is the QRMP scheme
The Quarterly Return filing and Monthly Payment of Taxes (QRMP) scheme is a GST compliance option introduced to reduce the filing burden for small taxpayers. Under this scheme, eligible registered persons can file their GSTR-1 and GSTR-3B returns on a quarterly basis instead of every month.
Although returns are filed quarterly, tax payments are required to be made every month. This is done through a challan generated on the GST portal, either using a fixed sum method or based on actual tax liability.
The QRMP scheme is available to taxpayers whose aggregate annual turnover does not exceed the prescribed limit in the preceding financial year. Once opted in, the scheme continues automatically for subsequent quarters unless the taxpayer becomes ineligible or chooses to opt out.
Time limits and process to opt in or opt out of the QRMP scheme
Taxpayers can opt in or opt out of the QRMP scheme only within the specified time window for each quarter. The option must be exercised on the GST portal before the relevant quarter begins. Changes made outside these timelines are not applicable for that quarter.
Applicable time limits
The opt-in or opt-out option is available only within the prescribed time window for each quarter.
|
Quarter |
Period covered |
Time limit to opt in or opt out |
|
Q1 |
April to June |
1 February to 30 April |
|
Q2 |
July to September |
1 May to 31 July |
|
Q3 |
October to December |
1 August to 31 October |
|
Q4 |
January to March |
1 January to 31 January |
Steps to opt in or opt out on the GST portal
The option must be selected online through the GST portal for the relevant quarter.
- Visit https://www.gst.gov.in
- Log in using valid GST credentials
- Go to Services and then Returns
- Select the option to opt in or opt out of the QRMP scheme
- Choose the relevant financial year and quarter
- Save and submit the selection
Once the option is submitted successfully, it will apply for the selected quarter in accordance with GST rules.
Implications of opting out of the QRMP scheme
Opting out of the QRMP scheme results in a change in return filing and payment obligations. Taxpayers should understand these implications before making the selection.
- Monthly return filing becomes mandatory: Once opted out, the taxpayer is required to file both GSTR-1 and GSTR-3B on a monthly basis instead of quarterly.
- Change in compliance frequency: Monthly filing increases the frequency of return submissions, which may require closer tracking of transactions and tax liabilities.
- Impact on cash flow management: Since tax is reported and paid monthly, businesses may need to plan cash flows more carefully compared to quarterly reporting.
- No impact on past quarters: Opting out applies only to the selected quarter and future periods. Returns already filed under the QRMP scheme for previous quarters remain unaffected.
- Auto-continuation unless changed: Once a taxpayer opts out, monthly filing will continue for subsequent periods unless the taxpayer becomes eligible and opts back into the QRMP scheme within the allowed timelines.
Understanding these implications helps businesses choose the filing method that best aligns with their compliance capacity and operational needs.
Conclusion
Opting out of the QRMP scheme changes the frequency of GST return filing and tax reporting, making monthly compliance mandatory. For some businesses, this shift offers better visibility into transactions and more regular reconciliation, provided the timelines and filing requirements are followed correctly.
Before opting out, taxpayers should review the applicable time limits and assess whether monthly filing aligns with their compliance capacity and cash flow planning. Making the selection within the prescribed window ensures the change applies to the intended quarter without complications.
Using reliable GST software, like TallyPrime, can help businesses manage the transition smoothly. With TallyPrime, businesses can record transactions accurately, track tax liabilities, and manage GST returns in a structured manner, supporting consistent compliance after opting out of the QRMP scheme.
