If you sell through Amazon, Flipkart, Meesho, Myntra, JioMart, or any other online marketplace, a portion of your payout is withheld before it ever reaches your bank account - not by the marketplace as a fee, but as tax collected at source on behalf of the government. TCS on e-commerce under GST is mandatory for the platform to collect and mandatory for you to reconcile, and misunderstanding how the credit works is one of the more common reasons sellers leave cash sitting unused in their electronic cash ledger.
What TCS Under GST Is
Under Section 52 of the CGST Act, every electronic commerce operator (ECO) that facilitates the supply of goods or services through its platform is required to collect a percentage of the net value of taxable supplies made through it by other suppliers, and remit this amount to the government. This is Tax Collected at Source, distinct from TDS under GST (Section 51), which applies to specified government-linked buyers deducting tax on payments for contracts above a value threshold. TCS applies specifically because a marketplace is standing between the seller and the buyer, collecting payment and disbursing it after deductions.
Current TCS Rate
| Supply type | Rate | Applies to |
|---|---|---|
| Intra-state supply | 0.25% CGST + 0.25% SGST (0.5% total) | Net value of taxable supplies made through the ECO |
| Inter-state supply | 0.5% IGST | Net value of taxable supplies made through the ECO |
This 0.5% rate has been in effect since 10 July 2024, following a reduction from the earlier 1% rate. Because TCS rates are set by government notification and can be revised again, always confirm the rate in force for the period you are filing on www.gst.gov.in rather than assuming the rate stays fixed indefinitely.
How the "Net Value" Is Calculated
TCS is not collected on your gross order value - it applies to the net value of taxable supplies, which is the aggregate value of taxable supplies made through the platform during the period, minus the aggregate value of supplies returned during that same period. This is why TCS collected in a given month does not always map cleanly to that month's dispatched orders alone: a return processed in the current period against a sale from an earlier period reduces the net value for the current period, not the earlier one. High-return categories (apparel, footwear) tend to show more month-to-month TCS variance for exactly this reason.
GSTR-8 - the Marketplace's Side of the Filing
Every ECO required to collect TCS files Form GSTR-8, generally due by the 10th of the month following the tax period, reporting the details of supplies made through the platform by each supplier and the TCS collected against each. This filing is what makes the credit visible to you as a seller - until the marketplace files its GSTR-8, the corresponding TCS entry does not appear for you to accept.
Claiming and Using Your TCS Credit
- After the marketplace files GSTR-8, log in to the GST portal and check the "TDS and TCS credit received" tab
- Review the entries against your own sales records for the period and accept them
- Once accepted, the amount is credited to your electronic cash ledger
- Use this cash ledger balance to pay output GST liability when filing GSTR-3B, or apply for a refund if the accumulated credit is not needed against current liability
The credit does not adjust automatically against your GSTR-3B liability - you have to actively accept it and then apply the cash ledger balance during payment, so a seller who never checks this tab can end up paying tax in cash while a TCS credit balance sits unused.
Common TCS Reconciliation Problems
- Multi-marketplace tracking - sellers active on several platforms need to reconcile TCS credit separately per GSTIN per marketplace, since each ECO files its own GSTR-8 independently
- Timing mismatches - TCS reflected for a period may relate to net value after returns spanning multiple original sale periods, so it will rarely tie out exactly to that period's gross sales figure
- Unaccepted credit - credit sitting in the GSTR-8 filing but never accepted on the portal does not reach the cash ledger and is easy to overlook without a monthly check
- Rate change transition - orders spanning a rate change date need the correct rate applied based on when the supply was actually made, not the date TCS happens to be reported
Reconciling TCS Across Marketplaces
If you sell on multiple platforms, treat TCS reconciliation as a per-channel exercise before consolidating: compare each marketplace's GSTR-8-driven credit entry against that channel's own settlement and sales reports, rather than reconciling one combined number against total bank credits. Our Amazon GST reconciliation guide walks through this process for one marketplace in detail, and the same logic extends to Flipkart, Meesho, Myntra, and JioMart with each platform's own report formats. For the GSTR-1 side of multi-marketplace filing, see GSTR-1 filing for Amazon sellers.
Keeping TCS Credit From Going Unclaimed
OneBooks GST imports sales data from Amazon, Flipkart, Meesho, Myntra, AJIO, and JioMart, and prepares GSTR-1 with validation warnings that help surface data gaps before filing - useful context when your own sales figures need to line up against a marketplace's TCS reporting. Use the GST calculator to sanity-check expected TCS on a given order value, and see GSTR-1 automation for how return preparation and reconciliation fit together.
Setting Up a Monthly TCS Check
Rather than treating TCS reconciliation as an annual clean-up task, build it into your monthly GSTR-1 or GSTR-3B routine: once a marketplace's GSTR-8 for the period is visible, pull the TCS credit entries, accept them, and note the total against that channel's net sales for the same period. Over a few months this creates a running record that makes it easy to spot a channel where credit consistently falls short of expectation - often the first sign of a settlement report and a sales report drifting out of sync rather than a marketplace error.
Frequently Asked Questions
What is the current TCS rate on e-commerce sales under GST?
0.5% of the net value of taxable supplies (0.25% CGST plus 0.25% SGST for intra-state, or 0.5% IGST for inter-state), in effect since 10 July 2024. Confirm the current rate on the GST portal since it is set by notification and can be revised.
Is TCS collected on my gross sales or net sales?
On net value - the aggregate taxable supplies made through the platform during the period, minus the aggregate value of returns during that same period.
How do I know how much TCS a marketplace has collected on my behalf?
Check the "TDS and TCS credit received" tab on the GST portal after the marketplace files its GSTR-8 for the period; the entries there show the TCS credited against your GSTIN.
Does TCS credit automatically reduce what I owe in GSTR-3B?
No. You must accept the credit entry on the portal first, after which it is added to your electronic cash ledger, and you then use that cash balance to pay output tax liability when filing GSTR-3B.
What is the difference between TCS and TDS under GST?
TCS (Section 52) is collected by e-commerce operators on supplies made through their platform. TDS (Section 51) is deducted by specified government-linked buyers on payments for contracts above a value threshold. They apply to different situations and different classes of collector/deductor.
Can I get a refund of TCS credit I cannot use against output tax?
Yes, once the TCS amount is credited to your electronic cash ledger, an unused balance can generally be claimed as a refund if it is not needed to offset current GST liability, subject to the applicable refund process.
Where OneBooks GST helps
OneBooks GST imports marketplace sales, returns and settlement reports so marketplace totals can be compared against book totals before anything is filed.
OneBooks GST keeps source data, reviewed output and exports as separate records, so a figure can be traced back rather than reconstructed.
