The Central Board of Indirect Tax and Custom (CBIC) has released a circular on 21 March 2020, stating that all businesses with turnover of more than Rs.500 crores are required to generate B2C invoices with their GST details captured as dynamic QR codes.

In this article, we’ll be covering the implications of the above mandate and how Cashfree Payments can help your business stay GST compliant.

Why is a dynamic QR code required for B2C invoices?

A dynamic QR code is a unique code generated for every transaction and expires once the transaction is complete. This dynamic QR code carries all the information about the transaction such as, the invoice number, invoice date, invoice amount, and the GST details of the business. 

Business to Consumer invoice or B2C invoice is an invoice generated by a business to a consumer or end-customer. For any B2C invoice, the recipient or the consumer will not be able to claim any tax benefit or input tax credit for the transaction made. 

The latest mandate by the CBIC to fetch the GST details of business as dynamic QR codes in the UPI transactions have the following implications, such as,

  • To allow customers to make digital payments with easy by scanning the dynamic QR code using any PSP application and entering only the UPI Pin to complete the transaction rather than all the transaction details
  • To capture GST details of merchants in all the UPI transactions so that the government can plan out further policies related to GST incentives and tax benefits
  • To get a hold of all the B2C transactions which were earlier not included in the e-invoicing of B2B transactions (B2B transaction invoices already have a QR code in it)

Any failure to comply with the above mentioned mandate after October 1, 2021, may attract a penalty of Rs.25,000 leviable for incorrect invoicing under Section 125 of the CGST Act. 

What are the details that need to be fetched in the dynamic QR codes?

The dynamic QR code will capture the following information about your business:

  • Supplier GSTIN number
  • Supplier UPI ID
  • Payee’s Bank A/C number and IFSC
  • Invoice number & invoice date
  • Total Invoice Value
  • GST amount along with breakup i.e. CGST, SGST, IGST, CESS, etc.

How can Cashfree Payments help you stay GST compliant?

The hardest part is to generate unique QR codes for every transaction. Cashfree Payments makes it easy by helping you create dynamic GST QR codes for all B2C invoices. These unique dynamic QR codes can be generated via APIs. 

You can read more about how to generate these dynamic GST QR codes here. Please sign up with us if you are interested in try this feature out.