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E-Invoicing – QR code for B2C Transactions

GSTN electronically authenticates all B2B invoices through an electronic invoicing mechanism called e-invoicing. A unique number is generated for each invoice posted on the Invoice Registration Portal (IRP). The GST portal and the e-way bill portal both get real-time transfers of invoice information from the IRP.

Although e-invoicing only applies to B2B bills, the legislation mandates that specific organisations create and print dynamic QR codes for B2C invoices.

E-invoicing for B2C transactions

The term “B2C transaction” refers to any supply made to an unregistered individual or consumer. Invoices from business-to-consumer transactions are ones where the end user will not be claiming input tax credit (ITC).

B2C invoices are currently excluded from e-invoicing. According to Notification No. 14/2020-Central Tax, as revised by Notification No. 71/2020-Central Tax, a taxpayer is required to develop a dynamic QR code in order to facilitate digital payments on all B2C invoices.

The notifications state that as of 1 December 2020, all taxpayers with an annual turnover of more than Rs. 500 crores in any prior financial year (beginning with 2017–18) must generate QR codes on their B2C invoices.

Additionally, the CGST Notification No. 89/2020, issued November 29, 2020, waived the penalty imposed for failure to comply with this condition from December 1, 2020, through March 31, 2021.

Any noncompliance beginning on April 1, 2021, would result in a Rs. 25,000 fine for erroneous invoicing under Section 125 of the CGST Act.

QR code for B2C invoices

Quick response codes (QR codes) are used. It contains encoded data related to an e-invoice. Any mobile device can scan it because it is a two-dimensional barcode.

The taxpayer must self-generate the B2C QR code. IRN generation is not necessary for B2C bills. A B2C invoice sent to IRP will be automatically denied, and if it is sent more than once, the taxpayer’s ability to generate IRNs may be restricted.

Therefore, encouraging the digitization of payments made using any UPI is the primary goal of creating QR codes for B2C e-invoices.

Dynamic QR code: A dynamic QR code can be edited and offers extra features like access control, device-based redirection, scan analytics, and password protection. It provides a less cluttered QR code image that is easier to read.

Who does not require the creation of dynamic QR code for B2C invoices?

Insurance companies, banks and other financial institutions, non-banking financial institutions, goods transport agencies, transportation companies selling passenger tickets, multiplex theatres selling movie tickets, and non-residents offering online information database access and retrieval services are among the exempt suppliers.

Since these are regarded as B2B transactions and e-Invoicing will be used, exporting products or services to unregistered persons does not require a dynamic QR code.

How can I create a QR code for a B2C invoice and its contents?

When it comes to B2B invoices, the IRP—not the taxpayer—generates the QR codes. Under B2C bills, taxpayers can create a QR code using their own devices and algorithms.

The following information must be included in a standard B2B QR code:

  • GSTIN for the provider
  • Supplier UPI ID
  • Supplier-provided invoice number
  • The creation date of the invoice
  • Information about the payee’s bank account and the IFSC
  • CGST, SGST, IGST, and Cess, if any

The customer should be able to make a digital payment by scanning the dynamic QR code.

B2C QR codes also require the same information, except for the following:

The recipient’s GSTIN is not required to be provided because he is not registered; instead, the taxpayer may provide his name.

A taxpayer must add a payment reference link, so the recipient is forwarded to it.The government can control B2C transactions by implementing QR codes on B2C invoices.

Furthermore, it supports the digitization of payments.UPI allows for one-time payment processing. You only need to enter your UPI PIN or password, and the payment will be made in the amount shown on the e-invoice.

Know more about e-Invoicing