GST for Ecommerce Sellers (2026): TCS, Filing and Credits

If you sell on Meesho, Amazon or Flipkart with a GSTIN, you file two returns regularly - GSTR-1 for your sales and GSTR-3B for the summary and payment

• plus an annual GSTR-9. The marketplace deducts TCS at 0.5% of your net taxable sales before paying you, deposits it against your GSTIN, and you claim it back. TCS is not a cost. It is a prepayment sitting in your ledger waiting to be used, and a lot of sellers never claim it.

One thing to get straight before anything else, because it is the most commonly wrong number on the internet.

TCS is 0.5%, not 1%

The rate was halved from 1% to 0.5% with effect from 10 July 2024, under CBIC Notification No. 15/2024-Central Tax.

Split:

Sale type	TCS
Intra-state (buyer in your state)	0.25% CGST + 0.25% SGST
Inter-state (buyer in another state)	0.5% IGST

Search this today and you will find plenty of 2026-dated guides still saying 1%. They are working from pre-2024 information and nobody updated them. If your accountant or your software is still calculating at 1%, your reconciliation will never match, and you will spend hours hunting a difference that is not there.

Most marketplace sales are inter-state, which means IGST rather than CGST+SGST. Sellers get this wrong on invoices more often than they realise.

TCS is a prepayment, not a fee

This trips up almost every new seller.

When Meesho or Amazon settles your payment, they hold back 0.5% of the net taxable value and deposit it with the government against your GSTIN. Your payout looks smaller. It feels like another platform charge.

It is not. That money is credited to your electronic cash ledger and offsets your own GST liability when you file. You get it back - as long as you claim it.

The word net matters: TCS is calculated on the value after returns, not on gross orders. So a month with heavy returns produces less TCS, which is one of the few places where returns work slightly in your favour.

The monthly cycle

Here is what actually happens, in order:

1. You sell. GST is charged on the sale. You are liable for it, not the marketplace.
2. The platform deducts 0.5% TCS and settles the rest to you.
3. By the 10th, the platform files GSTR-8 declaring what it collected against each seller's GSTIN.
4. Your TCS appears in GSTR-2B on the GST portal.
5. You file GSTR-1 with your sales details.
6. You file GSTR-3B, offset the TCS credit, and pay the balance.

Step 3 is worth understanding, because it is the one you do not control. If the platform files GSTR-8 late, your credit is delayed - not lost, but not available that month either. There is nothing you can do about it except notice.

What you file, and how often

Return	What it covers	Frequency
GSTR-1	Your outward sales, invoice-wise	Monthly, or quarterly under QRMP
GSTR-3B	Summary, TCS offset, tax payment	Monthly, or quarterly under QRMP
GSTR-9	Annual return	Yearly

Small sellers can opt for QRMP (Quarterly Return, Monthly Payment) - file quarterly, pay monthly. Less filing work, same money. Worth asking about if your turnover is modest.

GSTR-8 is not yours. That is the platform's return, filed by Meesho, Amazon or Flipkart. You never file it. You only depend on it.

The monthly job nobody does: reconciliation

This is the whole discipline, and it is fifteen minutes.

Every month, compare three numbers:

• What your settlement report says you sold, on the marketplace panel
• What your books say you sold
• What GSTR-2B shows as TCS credited against your GSTIN

They should agree. When they do not, the usual causes are:

• The platform filed GSTR-8 late, so credit has not appeared yet
• Returns were recorded in a different period than the original sale
• An invoice used CGST+SGST where it should have used IGST
• Your software is still calculating TCS at 1%

Sellers who skip this end up with TCS credit accumulating unused in their ledger while they pay GST in cash. That is your own money sitting idle. The settlement side of it lives in your Supplier Panel under Payments.

Returns and credit notes

When a customer returns a product, the sale reverses. You issue a credit note, and the GST charged on the original sale is reversed in the period the credit note is issued.

Two practical points:

• Credit notes must be issued within the same financial year as the original sale, so do not let them pile up until March.
• Marketplaces generally handle this in their seller dashboards, but the responsibility is yours. Verify it rather than assuming.

Given that returns are the single biggest profit leak on Meesho - reverse shipping alone runs around ₹153 on a sub-500g parcel - this is worth getting right. The full picture is in Meesho return charges and RTO.

The credit most sellers forget

TCS is the obvious credit. The one people leave on the table is input tax credit on platform fees.

Every marketplace charges 18% GST on its fees - shipping, commission, ads, reverse shipping. If you are GST registered, that 18% is claimable as ITC against your output liability.

On a seller doing a few lakh a month, that is a meaningful amount every single month, quietly forfeited by anyone who does not claim it. Every deduction and where the GST sits is broken down in Meesho seller fees explained.

You can check any figure with our free GST calculator, which handles add and remove GST plus the CGST/SGST split.

Do you even need GST to sell?

Widely stated as "mandatory regardless of turnover under Section 24." That was true, and for services it still broadly is. For goods, it changed.

Since October 2023, sellers of goods through a marketplace can use a free Enrolment ID instead of a GSTIN, provided they sell within their own state only, stay under the turnover threshold, and stick to permitted categories.

So both statements you will read are half right, which is why the topic is such a mess online. The conditions and the trade-offs are covered properly in selling on Meesho without GST.

Worth being clear about the cost of staying unregistered: you cannot claim any input tax credit. No TCS credit, no ITC on the 18% GST inside your shipping and platform fees. You absorb all of it.

Deadlines and what late filing costs

• GSTR-1 and GSTR-3B: monthly filers generally by the 11th and 20th of the following month; quarterly filers on the QRMP schedule
• GSTR-8 (the platform's): 10th of the following month
• Late filing: late fees plus interest at 18% per annum on tax paid late

The bigger cost is not the fee. Sequential filing means you cannot file this month until last month is done, so one missed return blocks everything behind it and the problem compounds. Nil returns still have to be filed.

Getting help

If this is your first year with a GSTIN, it is worth having someone handle the filing while you learn what the returns actually contain. Cheaper than a penalty, and considerably cheaper than a year of unclaimed credit.

We do GST registration for online sellers at ₹999 for proprietorships, filed within 24 hours, and monthly return filing as well.

Raising the invoice itself

For direct and B2B orders you issue the invoice yourself. The free GST invoice generator handles the CGST/SGST versus IGST split, HSN fields and totals in words, and downloads as a PDF.

FAQ

What is the TCS rate for ecommerce sellers in 2026?

0.5% of net taxable supplies - 0.25% CGST plus 0.25% SGST for intra-state sales, or 0.5% IGST for inter-state. It was reduced from 1% with effect from 10 July 2024 under CBIC Notification No. 15/2024. Many published guides still incorrectly say 1%.

Is TCS an extra cost to the seller?

No. It is a prepayment of your own GST. The platform deposits it against your GSTIN, it appears in your electronic cash ledger, and you offset it against your liability when you file GSTR-3B. It only becomes a loss if you never claim it.

Which GST returns does an ecommerce seller file?

GSTR-1 for outward sales and GSTR-3B for the summary and payment, either monthly or quarterly under QRMP, plus GSTR-9 annually. GSTR-8 is filed by the marketplace, not by you.

Ecommerce seller GST kaise file kare?

Har mahine do return: GSTR-1 mein sales ki detail, aur GSTR-3B mein summary aur tax payment. Platform aapke settlement se 0.5% TCS kaat kar aapke GSTIN par jama karta hai - wo GSTR-2B mein dikhta hai aur GSTR-3B mein adjust ho jaata hai. Har mahine settlement report, apni books aur GSTR-2B - teeno milaakar check karo.

Where do I see the TCS collected by Meesho or Amazon?

In GSTR-2B on the GST portal, once the platform has filed its GSTR-8 for that month. Reconcile it against your own settlement report every month rather than assuming it matches.

Can I claim GST on marketplace fees?

Yes, if you are GST registered. Platforms charge 18% GST on shipping, commission, ads and reverse shipping, and that is claimable as input tax credit. Sellers using an Enrolment ID instead of a GSTIN cannot claim any of it.

What happens if I file late?

Late fees plus 18% annual interest on any tax paid late. The bigger problem is sequential filing - you cannot file the current period until the previous one is filed, so a single missed return blocks every return after it.

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Not registered yet? We handle GST registration at ₹999 for proprietorships. Already selling and want the full cost picture, GST included, the Meesho A-Z Course covers pricing that survives it.