Answer: For the business entities having a turnover of over ₹50 crores, Centre has made it mandatory to provide facilities for accepting payments via the prescribed electronic modes.
Enrich Your Learning:
- With effect from January 1, 2020, the Centre has made it mandatory for business entities having a turnover of over ₹50 crores to provide facilities for accepting payments via the prescribed electronic modes.
- Non-adherence will attract a penalty of ₹5,000 per day from February 1, 2020.
The Central Board of Direct Taxes (CBDT) has notified the modes of payment, in addition to the facility for other electronic modes, as:
(i) Debit Card powered by RuPay
(ii) Unified Payments Interface (UPI) (BHIM-UPI);
(iii) Unified Payments Interface Quick Response Code (UPI QR Code).
Purpose of the order:
- The directive is meant to encourage digital economy and move towards a less-cash economy, for which a new provision was inserted in the Income-Tax Act earlier this year.
No charge on payer/recipient:
- As directed by the government, banks or system providers will not impose any charge on anyone making or receiving payment through the prescribed electronic modes.
- Therefore, any charge — including the Merchant Discount Rate — will not be applicable on or after January 1, 2020, on such transactions.