devesh02's blog
Introduction
Taxpayers with an annual turnover of less than INR 5 crore will not be mandated to submit GSTR-1 and GSTR-3B forms on a monthly basis as agreed in the 42nd GST Council meeting. They will now conduct it on a quarterly basis. Further, on December 5, 2020, the Modi Government finally announced the commencement of the same under the name QRMP Scheme. In this article, we'll talk about the QRMP Scheme, who is eligible to file, and how to file GST returnsusing Forms GSTR 3B and GSTR 1 under the QRMP Scheme.
What is QRMP Scheme?
QRMP scheme stands for Quarterly Return filing & Monthly Payment of Taxes. Taxpayers can make monthly GST payments by challan under the QRMP Scheme.
The two options for making GST returnpayments are self-assessment of monthly liabilities and 35% of the net cash liability of previously filed GSTR-3B of the quarter.
Who is eligible for QRMP Scheme?
A registered person who must submit a return in GSTR-3B and who had an aggregate turnover of up to INR 5 crore the previous financial year is eligible for the QRMP Scheme. It is clarified that the aggregate annual turnover for the previous financial year shall be determined on the common portal using the information provided by the taxpayer for the tax period in the previous financial year.
Benefits of the QRMP Scheme
The burden of compliance on the taxpayer has decreased significantly.
Instead of filing 12 GSTR-3B forms annually, taxpayers just need to submit 4 GSTR-3B returns.
Since this scheme offers an invoice filing facility (IFF), taxpayers would only need to submit GSTR-1 returns 4 times.
Since this scheme offers an invoice filing facility (IFF), taxpayers would only need to submit GSTR-1 returns 4 times. The remaining invoice information can be included in the GSTR-1 quarterly report.
In the first two months of a quarter, conveniently pay monthly taxes using the Fixed Sum Method (pre-filled Challan) or the Self-Assessment Method (actual tax owed after adjusting ITC).
How to opt for the QRMP scheme?
The Scheme will be available on the common site of GST throughout the year. Go to www.gst.gov.in > Login > Services > returns> Opt-in for quarterly return. You can file GST return onlineeven after opting for QRMP scheme.
An individual who has registered may choose to opt-in for any quarter between the first day of the second month of the previous quarter and the final day of the first month of the current quarter.
It is not necessary to choose the scheme separately for each quarter. The Scheme would be valid for upcoming tax periods once it was activated.
Furnish the details of outward supplies with IFF
The details of an outward supply must be provided in Form GSTR-1 by the registered persons choosing the Scheme once every three months. However, the supplier has the choice to provide the information on a monthly basis. The Invoice Furnishing facility ('IFF'), which is optional, has been established to provide data on invoices of supply made to registered persons during the first two months of the quarter.
It should be noted that the taxpayer is only permitted to upload a total of Rs.50 lakhs worth of invoices in each of the two quarter-long months. The invoices can be uploaded in IFF either all at once or continuously between the first day of the month and the 13th day of the following month.
The details uploaded in the IFF will be reflected in Form GSTR-2A and Form GSTR-2B of the interested recipient.
Monthly tax payment under the QRMP scheme
The registered person under the QRMP Scheme would have to deposit the requisite amount on Form GST PMT-06 in order to pay the tax due in each of the first two months of the quarter. The payment should be made by the 25th day of the next month. The money deposited by the registered taxpayer in the first two months will be deducted solely to balance the liability reported in Form GSTR-3B for that quarter.
On the portal, a tool would be made available for creating a pre-filled challan in Form GST PMT-06. The registered taxpayer has two methods listed below for making tax payments each month for the first two months:
Fixed sum method:Under this method, if the last return is submitted on a quarterly basis, an amount equal to 35% of the tax liability paid for the previous quarter must be paid. If the last GST return filingis on a monthly basis, the tax liability for the previous month that was paid in the return must be paid. As long as the tax is paid by the due date, there won't be any interest payable. No late fees would be charged for the delay in payment of tax if you use Form PMT-06 to pay your taxes.
Self-assessment method: In any case, the registered taxpayer can pay the tax due by using Form GST PMT-06 to calculate the tax liability of both inward and outward supplies as well as the available Input Tax Credit. Interest would be applicable to the taxpayer under this method.
Introduction
When a layman intends to start a business, it is often unclear to him which business form is best for the new business entity. The two most common business form an entrepreneur selects is Private Limited Company and Limited Liability Partnership. These are 2 different concepts governed by Indian corporate law.
A Limited Liability Partnership is a corporate body that is constituted under the Limited Liability Partnership Act, 2008. The LLP enjoys perpetual succession and functions as a separate legal entity from its partners. The existence, rights, and responsibilities of the LLP partnership will not be impacted by the change in the partners. The Private Limited Company is prohibited from transferring shares under the Companies Act, 2013. The Private Limited Company is a separate legal entity as LLP and also provides limited liabilities protection to the members. But most entrepreneurs get confused about which one is better and easy to operate. So let us see how registering LLP is better idea than registering a Private Limited Company.
How registering an LLP is better than a Private Limited Company?
It is easy to say the registration of both Private Limited Company and a Limited Liability Partnership is simple. Thus, it is not the issue or question of ease of registering but the question here is the direction and future of business. Sometimes it is beneficial to incorporate as a Private Limited Company. But we will provide you with a comprehensive argument on why LLPis better than Private Limited Company:
LLPs combine both the characteristic of the flexibility of partnership firms with the limited liability protection to members of the Private Limited Company.
In comparison to the cost of forming a Limited Liability Partnership is substantially less than the cost of forming a Private Limited Company.
In comparison to Private Limited Companies, the requirements of statutory compliance are less for LLPs. If an LLPhas not reached the threshold limit of INR 40 lakhs as the aggregate turnover or revenue contribution of INR 25 lakhs for the particular financial year, then there is no need of auditing the financial statement and accounts. However, a Private Limited Company must audit the financial statements and accounts of the company.
A company can only increase the number of owners in a Private Limited Company to a maximum of 200 shareholders due to its condition of restricted ownership. However, LLPs are not subject to any restrictions regarding a maximum number of members in the firm.
The need of holding meetings is substantially more in a Private Limited Company with the requirement of holding 4 Board Meetings. But if we talk about LLP, the firm must hold 1 annual Board Meeting for all the partners.
The incorporation cost of an LLP is very less as compared to the incorporation cost of a Private Limited Company.
In the case of LLP, there are many tax advantages. Such as wealth tax, surcharge, and dividend distribution tax (DDT) are among the taxes that are not imposed on Limited Liability Partnership whereas all these taxes are imposed in Private Limited Companies.
There are some Private Limited Companies which fail to comply with the mandatory compliance such as filing an annual return, filing financial statements and insolvency etc. with MCA can lead to hefty penalties up to INR 1 lakhs. But if the LLP fails to comply with the compliances then the penalty is very low as compared to the Private Limited Company.
Takeaway
There are more benefits of LLP over a Private Limited Company. In the light of these benefits, it is a wise step for entrepreneurs or early-phase start-up to choose LLP business form. Registering as an LLPwill help you in many ways like less statutory compliance, low cost of incorporation, can have end number of shareholders etc.
