Latest updateUPI remains free for P2P transactions. Merchant transactions up to ₹2,000 remain free. Applicable P2M transactions above ₹2,000 can attract MDR once NPCI notifies the post-Diwali start date (originally 15 October 2026) under the current framework.
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Business Payments Received Through UPI

Written by UPITax Editorial TeamEditorial review: UPITax Editorial TeamPublished: 16 September 2026Last updated: 13 October 2026Last verified: 13 October 2026
Quick answer

UPI collections are business receipts. They form part of turnover and must be recorded, whether they arrive by QR code, payment link or a personal UPI handle.

UPI P2M charges →

Tax side and charges side

AspectPositionWhere to read more
Income taxCollections form part of turnover and feed into taxable business incomeUPI tax
GSTDepends on the supply and your registration status, not on UPIGST on UPI payments
MDRA payment charge on specified merchant transactions, not a taxUPI MDR
Small merchantsEligible small merchants can remain outside MDRUPI P2M charges

Do not collect business money on a personal handle

  • Mixed accounts make turnover impossible to reconcile and personal transfers hard to distinguish.
  • A dedicated merchant handle or current account keeps collections, refunds and settlements traceable.
  • Merchant classification with your acquiring bank or aggregator also determines how charges apply to you.

Merchant categories and MDR structure

✓ Official source — NPCI · View · Verified 13 October 2026

Monthly routine that keeps you clean

  • Download the UPI/settlement statement and reconcile to sales.
  • Record refunds and failed-transaction reversals separately from sales.
  • Note charges deducted by the acquirer — they are a business cost, not a tax.
  • Keep the GST treatment of each supply documented where you are registered.

Sources and verification

Facts on this page are checked against official sources — NPCI, RBI, the Income Tax Department, the Ministry of Finance, PIB and the GST portal. See the full list on the official sources page, the fact-checking process, or report an issue through corrections. Last verified: 13 October 2026.

Related pages

UPI P2M charges →UPI MDR explained →GST on UPI payments →UPI charges calculator →

This page is educational information, not professional tax, legal or financial advice. Rules can change — verify against the latest official notification or consult a qualified professional before acting.