GST and TCS FAQs
What is GST?
Goods and Services Tax (GST) is the latest system of Indirect Taxation in India, which has replaced many individually applied taxes into a single tax. This taxation system has been in effect since July 1, 2017.
What are the different Tax types and how are they applied in the GST taxation system?
There are 4 GST types namely: Integrated Goods and Services Tax (IGST), State Goods and Services Tax (SGST), Central Goods and Services Tax (CGST), and Union Territory Goods and Services Tax (UTGST).
| Type of GST | When is it applicable? |
|---|---|
| CGST | Within same state, i.e. intrastate |
| SGST | Within same state, i.e. intrastate |
| IGST | Between two different states or a state and a Union Territory, i.e. interstate |
| UTGST | Within same Union Territory (UT) |
Different products have different GST rates, how can I configure them against my listings?
Product Tax Codes (PTC) have pre-defined values that correspond to GST rates. We recommend you set the appropriate tax codes to ensure that right GST is charged on the listings. These PTCs can be assigned at a listing level and account level.
To know more about how to set product tax codes please refer to this Seller University Video. The list of PTCs and corresponding rates are provided in this help page. We recommend you to reach out to your tax advisor to determine the appropriate tax rates for your products.
Do I need to update PTC at listing level and account level both?
Yes, if you are selling in different categories with different tax rates because if any of listing does not have a PTC, Amazon will consider the account level PTC that has been updated in your Manage GST details Page.
I have just updated PTC code, how long does it to reflect against my orders?
It takes approximately 72 hours for account level PTC and 10-15 minutes for listing level PTC.
If my product selling cost is 500 and shipping cost is 100, Will I have to pay GST on 500 or 600?
GST is applicable on the full value of consideration. We recommend you to reach out to your tax advisor for more information.
Which report should I refer to find the tax details for my orders?
As a seller on the Amazon.in marketplace ("Amazon"), you are required to report the sales made on Amazon to the Government. To facilitate such a state-wise filing, Amazon provides you with sales reports called Merchant Tax Reports (MTR).
To know more about Merchant Tax Reports, please visit this help page.
How can MTR be used to file GST return (on ClearTax)?
In partnership with ClearTax, Amazon launched a feature on ClearTax to help all Amazon sellers prepare, reconcile and file their B2C tax returns effortlessly and in a compliant manner. You can now import all their transaction data from Seller Central into ClearTax with a simple upload of the Amazon Merchant Tax Report (MTR) available on Seller Central. The system will extract the relevant information, auto-populate your GST return forms, perform validations, highlight any inconsistencies, and allow you to file them on GSTN directly from the Clear Tax Portal.
For more information about this service, click on the link to know more.
I see tax total section on Manager Order’s page. Who is paying this tax – seller or buyer?
Buyers. This section just indicates the amount of taxes that buyers are paying.
Where can I find the invoices generated by Amazon?
Please refer to the Printing Tax Invoices help page to know about how to download single invoices and invoices in bulk.
In case of orders being refunded, where can I find the details about the Credit notes?
The Merchant Tax Reports have columns called “Credit note” and “Credit note date” for refund transactions. We recommend you to follow the Merchant Tax Reports (MTR) for tax reconciliation purposes.
Tax invoices for mobile devices do not show IMEI numbers right now. Where can I find this data?
We recommend you to use MTR On-Demand.
This report will provides itemized details for order transactions on Amazon, and lists out detailed information with respect to the orders such as invoice numbers, serial numbers/IMEI numbers, breakdown of tax details, final status of orders such as Fulfilled, Cancelled, Returned, etc.
What GST percentage will be charged for services provided by Amazon?
18% GST will be charged on services provided by Amazon.
What about HSN codes? Why is Amazon not asking to update HSN? Is it going to remain optional? Isn't it mandatory to have HSN code in the invoice?
Yes, there is certain threshold limit prescribed by the GST Council for HSN declaration in the tax invoice. A placeholder is given to update the HSN against each respective ASIN’s listed.
If you input the HSN, the same will propagate to the invoice. HSN field has been kept as optional field for seller’s listing.
If seller’s annual turnover crosses the threshold notified by GST authorities, seller in their own discretion, to comply with the compliance requirement, can update relevant HSN applicable for their listings. We recommend you to reach out to your tax advisor to get the appropriate HSN codes for your products.
What are the basic return compliance requirements for a Seller?
A Seller has to file the details of the outward supplies made during the month in GSTR – 1 by the 11th of the following month. Additionally, by 20th of the following month, the Seller has to file a consolidated return in GSTR – 3B. The Seller also has to pay net GST liability after availing credit on inputs, input services and TCS by 20th of the following month.
Apart from all of the above, a Seller has to file an annual return by December 31 following the end of the financial year.
I am selling in FBA via multiple FCs, How can I update the GSTIN for each state?
As a seller, when you are registering for FBA through the self-service workflow, you will be able to update the GSTIN details for each state where you intend to register for FBA.
Post registration, you can see the details in Manage GST details Page.
Do I need to pay tax and claim credit for moving material to FBA warehouse, and removals?
There is no tax on stock transfer within the state. However, Inter-state Stock transfer will attract GST at an applicable rate.
I have provisional GSTIN from Rajasthan, but planning to shift warehouse (self-ship) to Madhya Pradesh. Will I be able to change/ add GSTIN on Amazon Seller Central in the future?
Yes, you will have to get a GSTIN for that particular state and update it in Seller Central.
What is TCS?
As per the GST law, all e-commerce operators need to collect an amount at the rate of 1% on the net value of taxable sales. The amount collected through above means is called as Tax Collection at Source (TCS) which is required to be remitted by e-commerce operator to the government on monthly basis. The seller will be able to utilize the TCS credit to offset their output tax liabilities. TCS provision are effective from October 1, 2018.
TCS is calculated on net value of taxable supplies of goods and services which the value of goods sold by the Seller during the month on which GST is payable less (minus) sales returns.
What is the percentage of TCS? What would be the bifurcation?
The rate of TCS is notified by the Government as 1% .
For Intra-state transactions it is SGST% / UTGST% and CGST% – 0.5% each and for Inter-state transactions it is IGST % – 1%.
Is TCS applicable only on sales above a specific threshold?
There is no threshold limit prescribed for TCS and it will be applicable to all taxable products sold on Amazon.in.
Where can I see TCS deduction reflect on seller central?
TCS will reflect in Order’s Payment Summary page at an order level. If you wish to view these details in bulk, you can refer Merchant Tax Reports in Seller Central.
Which Transactions will not have TCS?
Orders on listings with Product Tax code as A_GEN_NOTAX and Free replacement orders will not have TCS deductions.
How can I reconcile the payments post TCS deduction?
TCS collected and paid to the government on behalf of the sellers will reflect in the MTR reports. Sellers will need to refer to the details and file their monthly taxes accordingly.
We request sellers to use Merchant Tax Reports for all tax reporting requirements for the transactions done on Amazon.in.
Do we need to change anything on Product Tax Code (PTC) with implementation of TCS?
We recommend sellers to consult with their tax advisor to identify which products are taxable and update the appropriate Product Tax codes to ensure that right GST rates are updated and TCS is deducted.
By when will Amazon deposit the TCS amount for us to claim it?
Amazon will report details of TCS collected in GSTR- 8 by 10th of the following month. Credit of TCS amount will reflect in Seller’s GST electronic cash ledger. The amount can be utilized for discharging output GST liability, interest, penalty, fees or any other amount payable.
Do I need to undertake any additional compliance for claiming TCS credit?
Seller need to ensure that their GSTIN is correctly updated in their Seller Central account.
The details of the TCS collected would be reflected in sellers GST portal. For verifying the TCS credit at your GST portal: Login --> Select month --> Click on "TDS and TCS credit received" --> Click on 'TCS credit received' --> Select GSTIN wise TCS details and accept --> Accept the declaration and proceed to file --> File TCS credit received summary --> Check for balance in electronic cash ledger.
Once the transaction is accepted, TCS credit will be reflected in electronic cash ledger at seller GST portal.
Sellers to consider Merchant Tax Reports for monthly filing/TCS reconciliation reporting which will also be considered by Amazon for TCS reporting.
What is the mechanism for calculation TCS when there are Returns/Refunds?
Amazon is required to collect TCS on the ‘net taxable value’ of supplies made by the Seller through an e-commerce marketplace.Net taxable value is arrived at after reducing the aggregate value of taxable supplies returned to the Seller. Thus, amount of TCS for a particular month would be collected only after adjusting the returns made during the month.
Following is an illustration of amount of TCS that shall be collected per month by Amazon after considering supply returns:
| Particulars | Amount (in INR) |
|---|---|
| (A) Value of goods/services invoiced to customer for the month | 50,000 |
| (B) Value of goods/services returned by customer during the month | 15,000 |
| (C) Net taxable value on which TCS needs to be undertaken (A) - (B) | 35,000 |
| (D) TCS to be deposited by Amazon to the government (1*% of C) | 350 |
What if I do not have an outward GST liability in the month in which goods are returned? How will I adjust the TCS paid?
If sellers do not have taxable outward supplies in the month in which supplies are returned, then seller should be eligible for adjusting excess TCS paid earlier, against future outward GST liability or refund of excess balance of TCS available in the electronic cash ledger.
