B2B firms exempted from using only BHIM, RuPay for accepting payments

The relaxation has been issued for B2B companies, “If at least 95% of aggregate of all amounts received during the previous year, including amount received for sales, turnover or gross receipts, are by any mode other than cash,” the Central Board ...

Agencies
The clarification came in response to representations stating that requirement of mandatory facility for payments through the prescribed electronic modes was not applicable to B2B businesses since they don’t deal with customers directly.
Companies engaged in business-to-business (B2B) transactions have been exempted from installing e-payments facilities such as RuPay or UPI, the Central Board of Direct Taxes clarified on Wednesday.

The relaxation has been issued for B2B companies, “If at least 95% of aggregate of all amounts received during the previous year, including amount received for sales, turnover or gross receipts, are by any mode other than cash,” the Board said in a circular dated May 20.

The clarification came in response to representations stating that requirement of mandatory facility for payments through the prescribed electronic modes was not applicable to B2B businesses since they don’t deal with customers directly.


Further, the prescribed electronic modes have a maximum payment limit per transaction or per day they are not so relevant to B2B as they receive large payments through other electronic modes.

Till now, companies that had little or no retail customer or B2C transactions were still mandated to install e-payment facilities or pay penalty of Rs 5,000 per day. With the clarification, the additional cost element has been removed, experts said.

“This is a much awaited circular… This is another instance which shows that government is responsive to needs and concerns of taxpayers as well as flexible to amend rules to remove genuine hardships of taxpayers,” said Shailesh Kumar, Director, Nangia Andersen Consulting.
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