Quick Response Code for B2C Invoices under GST

Quick Response Code for B2C Invoices under GST

Executive Summary:

• • • Quick Response (QR) Code is a 2-dimensional bar code that can read information digitally and also store information and allows instant access to information.
    • A dynamic QR Code is mandatory for all B2C invoices issued by registered persons with turnover above Rs. 500 crores in any financial year from 2017-18, with effect from 1st December, 2020.

Introduction:

Quick Response (QR) Code is a 2 dimensional bar code with that can read information digitally and also store information as a series of pixels in a square-shaped grid and can be either a dynamic or static code based on the information stored. It allows to access information instantly hence called quick response code. A dynamic QR Code is mandatory for all B2C invoices issued by registered persons with turnover above Rs. 500 crores in any financial year. B2C invoices are those invoices where the end user or customer would not claim any input tax credit.

QR Code for B2C Invoices under GST:

The proviso to Rule 46 inserted vide Central Goods and Services Tax (Fourth Amendment) Rules, 2019 permits the Government to specify the tax invoices which will require Quick Response (QR) Code and in response to the powers conferred by the proviso, the Government through notification no. 14/2020, notified that all registered persons who issue invoices to an unregistered person i.e. B2C invoices and whose aggregate turnover in a financial year exceeds Rs. 500 crores shall have Dynamic Quick Response (QR) Code on such invoice.

Further, the notification was amended to implement the requirement to print QR Code on B2C invoices if the turnover exceeds Rs. 500 crore in any financial year from 2017-18 onwards, from 1st December, 2020. Vide notification no. 06/2021, the Government has decided to waive penalty for non-compliance with the requirement of printing QR Code on B2C invoices, till 30th June, 2021, provided that the invoices have QR Code printed from 1st day of July, 2021.

All registered persons with turnover above Rs. 500 crores in any financial year from 2017-18 and issuing invoices to unregistered persons i.e. B2C invoice shall display QR Code on such invoices from 1st December, 2020, but till 30th June, 2021 no penalty will be imposed for non-compliance provided that the invoices have QR Code displayed from 1st day of July, 2021, else will attract a penalty up to Rs. 25,000.

The QR Code on an invoice should be generated by the registered person and should be such that it can be scanned to make a digital payment and is required to contain the following information:

• a) Supplier GSTIN Number
• b) Supplier UPI ID
• c) Payee’s Bank A/C Number and IFSC Code
• d) Invoice Number & Date
• e) Total Invoice Value and GST amount along with breakup i.e., CGST, SGST, IGST and CESS

The Government has exempted the following class of registered persons from this requirement of providing QR codes on the invoices:

• An insurer or a banking company or a financial institution, including NBFC
• A Goods Transport Agency (GTA)
• A registered person supplying passenger transportation services
• A registered person supplying services by way of admission to the exhibition of cinematographic films in multiplex services
• Online information database access and retrieval (OIDAR) supplies made by any registered person, who has obtained registration under Section 14 of the IGST Act, 2017, to an unregistered person.

The notified registered persons are required to print QR Code on the invoices for digital payments and to capture the online payment details automatically but in cases where the customer opts to pay through other modes or cash without using QR Code, the supplier shall provide a cross reference of the payment (transaction ID along with date, time and amount of payment, mode of payment like UPI, Credit card, Debit card, online banking etc.) on the invoice or a cross reference of the amount paid in cash, along with date of such payment on the invoice as proof of compliance with the requirements.

Conclusion:

The QR Code for B2C invoices is made mandatory to promote digital transactions, especially after the demonetization phase. QR Code do not require any transaction related data and reduces transaction related errors and makes the process of payments simpler, yet posing difficulty for its mass adoption due to lack of awareness, usage of technology as not all are comfortable using the technology.

Regards,
Legal Team

Proind Business Solutions Private Limited
306, Tower B, I-thum, Plot No A-40, Sector 62, Noida, UP, India- 201301
No.: +91 120 4224203
Email: info@proind.in, website: www.proind.in