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Provisions of TCS under GST


Under Section 52, an Electronic Commerce Operator is liable to collect TCS only if the supply has been made through such Operator by other suppliers and the consideration is collected by the Electronic Commerce Operator, not being an agent. every person supplying goods through an ecommerce operator shall be mandatorily required to register irrespective of the value of supply made by him. There are a lot of ecommerce operators in India like Amazon, Flipkart etc.,

“Electronic Commerce Operator” is defined as any person who owns, operates or manages digital or electronic facility or platform for electronic commerce.

“Electronic Commerce” is defined as the supply of goods or services or both, including digital products over digital or electronic network.

“Net Value of Taxable Supplies” means (Aggregate Value of Taxable Supplies of Goods/Services) – Services under section 9(5) – (Aggregate Value of Returned Taxable Supplies/Goods).

The Person who is liable to deduct TCS under GST-

For all e-commerce operators/companies w.e.f.1st October 2018, have to deduct 1% tax collected at source (TCS) before making payments to their suppliers. It said that e-commerce operators have to obtain separate registration for TCS irrespective of whether they are already registered under GST as a supplier or otherwise and have GSTIN.

The CBIC said e-commerce companies, whether domestic or foreign, would have to register themselves in each state/UT as the obligation for collecting TCS would be there for every intra-state or inter-state supply.

In case of foreign e-commerce operators which do not have a place of business in India since they operate from outside but have suppliers and customers in the country, the CBIC said they would be liable to collect TCS on such supply and would be required to obtain registration in each state/union territory (UT).

All the traders/dealers selling goods/services online would need to get registered under GST even if their turnover is less than 20 Lakhs for claiming the tax deducted by Ecommerce operators.

Rate of TCS under GST-

TCS will be charged @ 1% (0.5% on CGST + 0.5% SGST or 1% for IGST).

Example, 1-

Mr. X is a trader who sells ready-made clothes online through Flipkart India. He receives an order for Rs 20, 000 inclusive of tax and commission. Flipkart charged a commission of Rs 150. Flipkart should be deducted 1% TCS on the amount of Rs. 20,000/-.  Flipkart should be deducted Rs. 200 on account of TCS and Rs, 150 on account of commission, balance amount will be paid to Mr. X i.e. Rs. 19,650/-

Registration as TCS deductor under GST-

Separate registration is required to be taken even if you are registered as Tax Payer. Now, you have to take registration as Tax Deductor.

The application for registration filed, by submitting a duly signed application “Form GST REG-07” by the deductor online or through facilitation center.

Time limit for payment of TCS-

The deductor shall be required to pay the deducted amount of TCS within 10 days after the end of the month of collection. Otherwise interest will be paid along with the amount of TDS till the default continue.

Example, 2-

TCS deducted of Rs. 1,000 (1% of Rs. 1,00,000) on account of ecommerce sale, in the month of October 2018, it should be deposited till 10th November 2018.

See the related post : What is CGST SGST and IGST
Credit of TCS deducted-

The deductor is required to file the statement on time, which contains the detail of Outward supplies of Goods & Services and Return of Goods & Services. When deductor pays the amount of TCS, it will be reflected into the GST electronic cash ledger of the deductee. The deductee can use the said credit, for payment of other taxes.

Statement Filing-

The deductor is liable to file monthly statement in “FORM GSTR-8” within a period of 10 days from the end of the month, or also file Annual statement in “Form GSTR-9B” before 31st December following the end of the financial year.



The details of supplies, including the value of supplies, submitted by the ecommerce operator in “Form GSTR-8”, will be matched by the details submitted by the supplier in his return shall be made available electronically to each of the suppliers in Part C of  “Form GSTR-2A” on the GST common portal after the due date of filing of “Form GSTR-8” in terms of Rule (2) of Rule 67 read with sub-section (8) of Section 52 of the Act.

When the Supplies under sub-section (4) do not match with the corresponding supplies of the supplier then, such discrepancy shall be communicated to both the persons in terms of sub-section (9) of Section 52 of the Act.


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