Tax and GST for e-commerce sellers
Selling through a marketplace requires GST registration from the first sale — the ₹40 lakh threshold does not apply — and the platform reports your turnover to the department in GSTR-8 whether or not you file anything. The recurring work is reconciliation: your settlement report is a net payout after commission, shipping, returns and TCS, and both your GST returns and your income tax return have to be built on gross sales rather than on what landed in the bank.
यह पेज आपके लिए है यदि
- You sell on Amazon, Flipkart, Meesho or a similar marketplace
- You run your own Shopify or WooCommerce store with a payment gateway
- Your stock sits in a platform fulfilment centre, possibly in another state
- Your declared turnover does not match what the platform reported
- You have TCS or TDS credits from platforms that you have never claimed
क्या अलग है
जो केवल आप पर लागू होता है
There is no turnover threshold for you
Section 24(ix) requires registration for anyone supplying through an e-commerce operator, at any turnover. The ₹40 lakh figure everyone quotes applies to ordinary businesses selling on their own account, and it is the single most common registration mistake among new online sellers.
The department already has the platform's version of your turnover
Marketplaces file GSTR-8 monthly, reporting each seller's supplies and the 1% TCS collected. A gap between that and your own returns is visible automatically, it does not need anyone to complain, and it accumulates quietly every month until a notice arrives covering several years at once.
Your payout is not your revenue
What reaches your bank is net of commission, fulfilment fees, shipping, return adjustments and TCS, and it arrives days or weeks after the sale. Recording the payout as revenue understates turnover and every deducted expense at the same time, which is precisely what puts your income tax return out of step with GSTR-8.
Stock in another state creates a registration there
Enrolling in a platform's fulfilment programme frequently means your inventory is held in a warehouse in a state you have never visited — and holding stock in a state requires GST registration in that state. Sellers routinely opt in without realising this, and it is the obligation most often missed.
You have two credits in two different systems
The platform collects 1% TCS under GST section 52, which lands in your electronic cash ledger, and deducts 0.1% TDS under income tax section 194-O, which appears in your 26AS. They are different credits in different systems, and sellers commonly claim one and forget the other entirely.
हम कैसे काम करते हैं
आपके मामले में यह कैसे चलता है
We decompose settlement reports into gross sales and expenses
Every payout is broken back into gross sale, commission, fulfilment fee, shipping, return adjustments and TCS. The books then record the gross sale with each deduction as its own expense — which is what makes your GST returns and your income tax return agree with what the platform reported.
Recording the net payout as revenue is the single structural error in marketplace accounting, and it understates turnover and expenses simultaneously so the margin still looks plausible.
We reconcile against GSTR-8 every month, not at year end
The platform files GSTR-8 monthly, reporting your supplies and the TCS collected. Any gap between that and your own returns is visible to the department automatically. Catching it in the month is a correction; catching it at the annual return is an explanation covering several years.
We also claim both credits — the GST TCS in the electronic cash ledger and the section 194-O TDS in 26AS — because they sit in different systems and sellers commonly claim one and forget the other.
We check where your stock actually is
Enrolling in a fulfilment programme often puts your inventory in a warehouse in a state you have never visited, and holding stock in a state requires registration there. We check this at the point you join the programme rather than when the mismatch surfaces.
Where a second registration is needed we take it and run the returns for it, so the aggregate still ties back to one income tax return.
जो अक्सर ग़लत होता है
- Waiting for the ₹40 lakh threshold, which does not apply to marketplace sellers
- Recording the net payout as revenue instead of gross sales
- Never claiming the GST TCS sitting in the electronic cash ledger
- Claiming the GST TCS but forgetting the section 194-O TDS, or the reverse
- Holding stock in a fulfilment centre in another state without registering there
- Netting returns against later sales instead of issuing credit notes in the right period