Small taxpayers with aggregate turnover up to Rs. 5 crore can choose between monthly and quarterly GST return filing under the QRMP (Quarterly Return Monthly Payment) scheme. Quarterly filers submit GSTR-1 and GSTR-3B every quarter while making monthly tax payments through challans. Taxpayers with turnover above Rs. 5 crore must file monthly, without exception.
Understanding Filing Frequency Options
The GST framework offers different filing frequencies based on the taxpayer’s aggregate turnover in the preceding financial year. This classification ensures that larger businesses with higher transaction volumes report more frequently, while smaller businesses benefit from reduced compliance burden.
| Taxpayer Category | Turnover Threshold | GSTR-1 Filing | GSTR-3B Filing | Tax Payment |
| Large taxpayers | Above Rs. 5 crore | Monthly by the 11th | Monthly by the 20th | With GSTR-3B |
| Small taxpayers (monthly option) | Up to Rs. 5 crore | Monthly by the 11th | Monthly by the 20th | With GSTR-3B |
| Small taxpayers (QRMP option) | Up to Rs. 5 crore | Quarterly by the 13th | Quarterly by 22nd/24th | Monthly by 25th via challan |
The choice between monthly and quarterly filing is made once per financial year when the taxpayer files their first return for that year. Mid-year changes are not permitted, so the decision should be based on careful analysis of the business’s supply profile and customer requirements.
Quarterly Filing Options for Small Taxpayers
The GST framework originally proposed three types of quarterly returns through the new system, each designed for different business profiles. While the full implementation was deferred, the quarterly filing concept was operationalised through the QRMP scheme.
Sahaj (Originally RET-2)
Sahaj was designed for the simplest business profiles, allowing declaration of only B2C outward supplies (sales to unregistered consumers) and inward supplies subject to reverse charge. It excluded supplies made through e-commerce operators that required TCS and did not permit credit claims for missing invoices. This form suited small retailers and service providers dealing exclusively with walk-in customers who do not require tax invoices.
Sugam (Originally RET-3)
Sugam provided broader coverage, enabling the declaration of both B2B and B2C supplies, as well as reverse-charge inward supplies. Like Sahaj, it restricted e-commerce supplies and failed to issue invoice credits. This form was appropriate for small businesses with a mix of registered and unregistered customers, such as wholesalers who also operate a retail counter.
Normal Quarterly Return
The Normal quarterly option provided comprehensive coverage of all supply types without restrictions, including supplies through e-commerce platforms, Special Economic Zone supplies, and deemed exports. This was the default for taxpayers who needed full reporting capability without the limitations of Sahaj or Sugam.
Under the current QRMP scheme, all quarterly filers effectively use the equivalent of the Normal quarterly return through quarterly GSTR-1 and GSTR-3B filings.
The Invoice Furnishing Facility (IFF)
A critical component of the QRMP scheme is the Invoice Furnishing Facility, which addresses the ITC timing gap created by quarterly filing for B2B buyers.
Under monthly filing, supplier invoices flow into the recipient’s GSTR-2B every month after GSTR-1 is filed. Under quarterly filing without IFF, the recipient would wait until the end of the quarter to see the supplier’s invoices in their GSTR-2B, delaying their ITC claims by up to two months.
IFF solves this by allowing quarterly filers to upload B2B invoice details for the first two months of each quarter (months 1 and 2). These invoices then flow into the recipient’s GSTR-2B in those months, maintaining timely ITC availability. The third month’s invoices are covered by the quarterly GSTR-1 filing.
| Month in Quarter | B2B Invoice Reporting Method | Recipient ITC Availability |
| Month 1 | IFF upload (optional, by the 13th of month 2) | In month 1’s GSTR-2B |
| Month 2 | IFF upload (optional, by the 13th of month 3) | In month 2’s GSTR-2B |
| Month 3 | Included in quarterly GSTR-1 (by 13th after quarter) | In month 3’s GSTR-2B |
IFF has a cap of Rs. 50 lakh per month for uploaded invoices. If B2B invoice volume exceeds this limit, the remaining invoices are reported in the quarterly GSTR-1.
Monthly Tax Payment Under QRMP
Even under quarterly return filing, businesses must make monthly tax payments for the first two months of each quarter. Two methods are available for computing the monthly payment amount.
Fixed Sum Method
Under this method, the taxpayer pays 35% of the tax paid in the last quarter’s GSTR-3B for each of the first two months. This amount serves as an advance against the actual quarterly liability. When the quarterly GSTR-3B is filed, the difference between actual liability and advance payments is settled, either by paying the shortfall or carrying forward the excess.
Self-Assessment Method
The taxpayer calculates the actual tax liability for the month using available ITC data from GSTR-2B and pays accordingly. This method requires more effort but prevents overpayment (when business is slower) or significant underpayment (when business exceeds the previous quarter’s pace).
Monthly payments must be made by the 25th of the month following the relevant month. No return is filed for these payments; only a challan is generated through the GST portal.
Comparative Analysis: Monthly vs Quarterly Filing
| Aspect | Monthly Filing | Quarterly Filing (QRMP) |
| Total returns per year | 24 (12 GSTR-1 + 12 GSTR-3B) | 8 (4 GSTR-1 + 4 GSTR-3B) + IFF |
| Compliance effort | Distributed monthly | Concentrated at quarter-end |
| ITC availability for B2B buyers | Immediate (monthly GSTR-1 data) | Delayed unless IFF is used |
| Cash flow flexibility | Tax paid with each monthly return | Monthly advance + quarterly settlement |
| Filing deadline stress | Spread across the year | Higher pressure at quarter-end |
| IFF requirement | Not needed | Essential for B2B suppliers |
| Administrative cost | Higher (monthly preparation) | Lower (quarterly preparation) |
| Error correction window | Monthly amendments available | Quarterly amendments only |
Choosing the Right Filing Frequency
The optimal filing frequency depends on several business-specific factors. Businesses with significant B2B customers should consider monthly filing or diligent IFF usage, as their buyers need timely ITC. High-volume businesses may find monthly filing easier than accumulating three months of data for quarterly processing. Businesses with seasonal patterns may benefit from quarterly filing during lean periods. Cash-constrained businesses might prefer the fixed-sum method under QRMP to manage monthly outflows more predictably.
The filing frequency can only be changed once per financial year, at the time of filing the first return. Taxpayers should evaluate their supply profile, customer needs, and administrative capacity before making this annual decision.
Key Terms
• QRMP: Quarterly Return Monthly Payment scheme allowing small taxpayers to file GSTR-1 and GSTR-3B quarterly with mandatory monthly tax payments
• IFF: Invoice Furnishing Facility enabling quarterly filers to upload B2B invoices for the first two months of each quarter for timely recipient ITC
• Fixed Sum Method: Monthly tax payment calculated as 35% of the previous quarter’s GSTR-3B liability for each of the first two months
• Self-Assessment Method: Monthly tax payment based on actual liability calculation using available ITC and outward supply data
• Aggregate Turnover: Total value of all taxable, exempt, and export supplies used to determine filing frequency eligibility
Choosing Between Monthly and Quarterly Filing?
Select the filing frequency that best suits your business profile, customer base, and administrative capacity. Use WFYI tools to manage your filing schedule, track IFF uploads, and ensure timely monthly payments under QRMP.
| Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Consult a qualified tax professional for advice specific to your situation. |
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Frequently Asked Questions
Q1: Who is eligible for quarterly GST return filing?
Small taxpayers with aggregate turnover up to Rs. 5 crore in the preceding financial year are eligible for quarterly filing under the QRMP scheme. Taxpayers with a turnover of Rs. 5 crore or more must file monthly.
Q2: Do quarterly filers still need to make monthly tax payments?
Yes. Even under quarterly filing, businesses must make monthly tax payments by the 25th of the following month, using either the fixed-sum method (35% of last quarter’s tax) or the self-assessment method.
Q3: What is the Invoice Furnishing Facility (IFF)?
IFF allows quarterly filers to upload B2B invoice details for the first two months of each quarter, ensuring their B2B buyers receive timely ITC in their GSTR-2B without waiting for the quarterly GSTR-1 filing.
Q4: Can filing frequency be changed mid-year?
No. Filing frequency can be changed only once per financial year, at the time of filing the first return for that year. The system does not permit mid-year switches between monthly and quarterly.
Q5: Which option is better for businesses with B2B customers?
Monthly filing is generally better for B2B-focused businesses, as it provides buyers with immediate ITC availability through monthly GSTR-1 data. If quarterly filing is preferred, consistent IFF usage for B2B invoices is essential to maintain customer relationships.
Q6: Is there a cap on invoices uploaded through IFF?
Yes. IFF has a limit of Rs. 50 lakh per month for uploaded B2B invoices. Invoices exceeding this cap are reported through the quarterly GSTR-1 filing, which may delay the availability of ITC for those specific transactions.
