Is There GST on UPI MDR?

Published: 3 October 2026

Illustration of an Indian shopkeeper reviewing UPI receipts and payment documents to represent GST on UPI MDR

GST does not appear on the customer’s UPI screen. The question is whether the shop’s MDR, from 15 October 2026, carries GST. NPCI said on 22 September 2026 that payments with no MDR have no GST on MDR. Bills up to ₹2,000 are most merchant payments by volume, so most UPI taps never reach this fee.

Where a shop does pay MDR, briefings describe GST on that fee, not on the sale. A registered shop can set that GST off against GST on its goods, the way input tax is set off against output tax. A composition dealer may not. This page is not tax advice. Your return decides the credit.

A ₹10,000 Example

A standard shop takes ₹10,000. MDR at 0.4% is ₹40. Eighteen percent of ₹40 is ₹7.20. The customer still pays ₹10,000. The shop’s settlement shows the fee, and GST only if the bank adds it on that fee. The homepage calculator shows the ₹40, not the ₹7.20.

₹500 kirana bill: no MDR, so nothing to put GST on.
Small QR shop inside ₹1 lakh a month: reported MDR zero, so no GST on MDR.
₹3,000 standard bill: MDR ₹12. GST, if charged on the fee, is a small add-on to the ₹12, not to the ₹3,000.

A petrol bill on the flat ₹5 list is a ₹5 fee, not 0.4%. Any GST would be on that ₹5, not on the fuel. Confirm the line on the settlement before you book it.

The rate table and calculator stay on the homepage.