Tax Query: Will businesses comply with Dynamic QR Code?

1. Are all businesses with turnover exceeding Rs.500 crore expected to comply with the provisions of the Dynamic QR Code?

Ans: The provisions of the Dynamic QR Code will apply to businesses with turnover exceeding Rs.500 crore in any financial year, from the financial year 2017-18 onwards. 

However, invoices issues by certain classes of taxpayers mentioned below are not required to generate Dynamic QR Codes:

1. An insurance company
2. A banking company or a financial institution, including a non-banking financial company
3. A goods transport agency
4. A passenger transportation service
5. A supplier of services by way of admission to an exhibition of cinematography in films on multiplex screens
6. A registered person making OIDAR supplies 

2. Will the Dynamic QR Code need to be generated on export invoices?

Ans: Though exports are made by a registered person to an unregistered person, the provisions of the Dynamic QR Code will not apply. This is because e-invoices need to be generated for export invoices.

3. What details will the Dynamic QR Code contain?

Ans: The Dynamic QR Code will contain:

1. The GSTIN of the supplier 
2. The UPI ID of the supplier 
3. The invoice number and invoice date
4. The total invoice value
5. The GST amount, along with the breakup of CGST, SGST, IGST, Cess, etc. 
6. The payee’s bank account number and IFSC code 

4. In a situation where a Dynamic QR Code has been provided, but the customer makes payment without using it, will it be treated as compliance with the Dynamic QR Code requirements?

Ans: Yes, the invoice will be deemed to have complied with the Dynamic QR Code requirements if the supplier has issued an invoice containing a Dynamic QR Code.

Besides, in the following cases, if the supplier has digitally displayed the Dynamic QR Code, the provisions are also said to be complied with, if-

1. The customer has paid through debit/credit card or UPI, and the supplier provides a cross-reference of these payment details on the invoice, such as the transaction ID, date, time, amount, and mode of payment.
2. The customer has paid through cash, and the supplier provides a cross-reference of the date and amount details on the invoice.

5. In a situation where a supplier provides digital modes of collecting payments, such as UPI Collect, UPI Intent, etc. through a mobile or computer-based application, and the Dynamic QR Code is not displayed. Still, instead, the details of the merchant and the transaction details are displayed, will it be treated as compliance with the Dynamic QR Code requirements?

Ans: If a cross-reference can be provided on the invoice about the payment made using such electronic modes of payment, the invoice will be deemed to have complied with the Dynamic QR Code requirements.

However, if the payment is being made after the generation/issuance of the invoice, then the invoice is required to contain the Dynamic QR Code.

6. In a situation where the payment for an invoice has been made before the invoice has been issued, then is the generation/printing of the Dynamic QR Code on the invoice mandatory?

Ans: No, the generation/printing of the Dynamic QR Code on an invoice is not required in cases where the payment has been made before the issuance of the invoice. However, a cross-reference needs to be provided on the invoice of the payment made through cash/electronic mode or a combination of both. If these conditions are satisfied, then the invoice will be deemed to be compliant with the Dynamic QR Code requirements.

However, if the payment is being made after the generation/issuance of the invoice, then the invoice is required to contain the Dynamic QR Code.

7. Will suppliers who sell through e-commerce operators or any other online applications be required to comply with the Dynamic QR Code requirements if the e-commerce operator/online application has already complied with the same?

Ans: The Dynamic QR Code requirements will apply to each supplier individually, depending on their turnover and type of business. Hence, if a supplier is able to provide a cross-reference on the invoice of the payment received with regard to the said invoice, then the invoice will be deemed to be compliant with Dynamic QR Code requirements. 

However, if the payment is being made after the generation/issuance of the invoice, then the invoice is required to contain the Dynamic QR Code.

For any clarifications/feedback on the topic, please contact the writer at athena.rebello@cleartax.in

Athena Rebello

I’m a Chartered Accountant by profession and a writer by passion. ClearTax lets me be both. I love travel, hot tubs, and coffee. I believe that life is short, so I always eat dessert first. Wait.. life is also too short to be reading bios… Go read my articles!