Dynamic QR (Quick Reference) code is required to be shown on all Business to Customers Tax invoices issued by a registered taxable person whose turnover exceeds rupees five hundred crores during any of the last three financial years.
- Is there any difference between the QR code issued for e-invoice and the dynamic QR code?
Yes, there is a difference. Dynamic QR code is issued by taxpayers having turnover above rupees five hundred crores during any of the last three years for business-to-customer transactions. QR code for e-invoice is issued for a taxpayer in relation to business-to-business transactions.
2. From when is dynamic QR Code is applicable?
Initially, a Dynamic QR code is required to be issued from 1st of April 2020 wide notification number 72/2019 – Central Tax dated 13th December 2019. It got postponed to 1st of October 2020 wide notification number 14/2020 central tax, dated 21st March 2020, due to the pandemic-like situation and business were not ready to implement the same technologically. The same got postponed to 1st Dec 2020 wide notification number 71/2020 – central tax dated 1st Dec 2020.
As part of providing relief to the taxpayers, notification number 89/2020 – central tax dated 29th Dec 2020 issued waving of penalty under Section 125 of the CGST Act 2017 from 1st December 2020 to 31st march 2021 in case if the taxpayers’ issues tax invoices without dynamic, quick reference code for business-to-customer transactions.
From 1st of April 2021, all taxpayers having aggregate turnover above rupees five hundred crores must issue dynamic, quick reference code for business to customer transactions.
3. Why did the Government introduce the Dynamic Quick Reference Code?
The Government has issued the dynamic, quick reference code to track the invoices and payments received against such invoices.
4. What should be shown in the dynamic QR code?
The dynamic QR code should show the following information
- Supplier GSTIN number
- Supplier UPI ID
- Payee’s Bank A/C number and IFSC
- Invoice number & invoice date,
- Total Invoice Value and
- GST amount along with breakup, i.e., CGST, SGST, IGST, CESS, etc.
The dynamic QR code generated should have the facility for the customer to make digital payment.
5. Dynamic QR codes should be generated for which documents?
Dynamic QR code has to be generated for only tax invoices only as per notification number 72/2019 – Central Tax dated 13th December 2019.
6. In the case of exports, the overseas customer does not have a GSTIN number. Dynamic QR code has to be issued for export transactions?
No, a dynamic QR code is not required to be issued for the export invoices as e-invoice is being already issued for such transactions.
7. In multiple instances, we could see the suppliers or the retailers displays the QR code for enabling the payment by the customers. In such cases, also the Dynamic QR code has to be printed on the tax invoice?
As long as the supplier maintains the payment track, issuing tax invoices with dynamic QR codes for Business to customer transactions is not required.
The payment reference should be linked to the tax invoice/transaction id, date, time and amount of payment, mode of payment like UPI, Credit card, Debit card, online banking etc.
8. There are instances where the customers pay the retailers in cash; even in such cases, dynamic QR code has to be provided?
No, if the customer opts to pay the invoice in cash, it is not required in such cases, but the retailer has to maintain the cross-reference of the same.
9. In some instances, we come across where the retailer collects the payment before the issue of tax invoice, like sharing the OTP in case of Paytm or making payment through a link. Even in such cases, the retailer has to issue a Dynamic QR code?
In such cases, the retailer is not required to issue the tax invoice with a dynamic QR code as the payment is collected before the invoice is issued and cross-reference for the payment and invoice already exist.
10. In case of cash on delivery by the e-commerce operators or supplies made through e-commerce operations, does the tax invoice issues should have the Dynamic QR code?
In the case of supplies through e-commerce operators by e-commerce operators for cash on delivery termed as COD basis, a Dynamic QR code must be issued and printed on the tax invoice.
The Government has provided multiple postponements for the Dynamic QR code rollout, and now it is mandatory to be issued from 1st April 2021. If the taxpayers do not follow the same, then the department officers can issue penalty under Section 122 and Section 125 of the CGST Act 2017. Going by the trend of issue of e-invoice where the threshold has been reduced from rupees five hundred crores as on 1st Oct 2020 to rupees 50 crores from 1st April 2021, the threshold for the issue of dynamic QR code can also be reduced going forward. Based on past experiences, the taxpayers should gear up for the same even though it is not applicable as on date.