E-Commerce Operators and Sellers:
E-commerce sellers are individuals, small businesses or large enterprises who are engaged in selling goods or provide services through online platforms or electronic networks. These transactions are carried through digital realm by covering geographical boundaries.
GST applicability on E-Commerce operators:
The applicability of GST to e-commerce sellers varies depending on whether they supply goods or services:
Points to be Noted:
- The GST is to be paid through Forward Charge Mechanism for both Goods and Services.
- Supplier of Passenger Transport service are not liable to get registration, as GST is paid through Reverse Charge Mechanism.
- Supplier of Accommodation Services are liable to get registration only when the turnover limit crosses 20 lakhs. In case of Unregistered supplier GST is to be paid by the E-commerce operator.
e.g. Airbnb, Yatra, Treebo, Make My Trip
TCS Applicability to E-commerce sellers
- Under section 52 of the CGST Act, e-commerce Aggregators must collect and remit TCS at a rate of 1% of the total sale price.
- All sellers and merchants engaged in online sales can claim this TCS from e-commerce Aggregators, regardless of their turnover, provided they are registered under GST.
- Additionally, TDS is deducted at a rate of 1% on the gross sale amount.
- All e-commerce businesses and participants responsible for collecting TCS must utilize Form GST REG-07 to submit their application, which must be signed or verified using Electronic Verification Code (EVC).
Cancellation of GST Registration for E-commerce Operators
If a seller registers under GST solely for TCS purposes, and subsequently the Proper Officer determines that the business is no longer liable for TCS collection, the officer will issue a notice for cancellation under GST REG-08. The cancellation procedure will follow the same steps as for regular taxpayers.
GST returns for E-commerce operators:
GST Return | Description |
|---|---|
GSTR-1 | Monthly return of outward supplies of taxable goods and/or services affected. |
GSTR-2 | Monthly return for inward supply during a tax period, used to claim Input Tax Credit (ITC). |
GSTR-3 | Consolidated monthly return of outward supplies and input tax credit claimed, along with payment of tax by the taxpayer. |
GSTR-8 | Return to be filed by e-commerce operators containing details of supplies effected and the amount of tax collected at source by them. |
GSTR-9 | Annual return required for all GST-registered taxpayers, including e-commerce sellers/operators. |
Frequently Asked Questions
Individuals selling goods on e-commerce platforms and collecting TCS were previously not allowed to opt for composition scheme but this restriction has been removed with effect from October 1, 2023.
Non-Resident are not required to file GSTR-8 for selling goods through e-commerce platform.
Author
Fareed
