GST & TCS Rules for Amazon and Flipkart Sellers in 2026

Selling products on Amazon or Flipkart can make it easier to reach customers across India, but marketplace sales also come with GST and TCS compliance requirements.

If you sell through an e-commerce operator, you may see TCS deducted from your marketplace settlements. Understanding how this amount is calculated, where the credit appears, how returns affect TCS, and how marketplace reports should be reconciled can help prevent cash-flow issues and GST mismatches.

Quick answer: For e-commerce transactions covered by Section 52, the current GST TCS rate is 0.5% of the net value of taxable supplies—0.25% CGST + 0.25% SGST/UTGST for intra-State supplies, or 0.5% IGST for inter-State supplies. The reduced rate has applied since 10 July 2024.

However, GST registration requirements for online sellers should not be reduced to a simple registration from the first sale rule. The applicable requirement depends on the nature of the supply, the e-commerce arrangement and relevant GST provisions or exemptions.

What Is TCS Under GST for E-Commerce Sellers?

TCS stands for Tax Collected at Source.

Under Section 52 of the CGST Act, an e-commerce operator that is required to collect TCS collects tax on the net value of taxable supplies made through the platform by other suppliers, where the consideration is collected by the operator.

In simple terms:

Customer places an order → Marketplace processes the transaction → TCS is collected → TCS is reported to the GST system → Amount is reflected in the seller's Electronic Cash Ledger.

TCS is therefore not simply a marketplace fee or an additional business expense. The amount collected is credited to the seller's GST Electronic Cash Ledger and can be used according to the GST rules applicable to that ledger.

What Is the TCS Rate for Amazon and Flipkart Sellers in 2026?

The GST TCS rate applicable under Section 52 is currently 0.5% of the net value of taxable supplies covered by the provision.

The rate was reduced from 1% to 0.5% with effect from 10 July 2024.

Example

Suppose your eligible net taxable supplies through a marketplace are ₹1,00,000 during a period.

At a 0.5% TCS rate: ₹1,00,000 × 0.5% = ₹500 TCS

The exact marketplace settlement will also depend on other adjustments such as returns, fees, commissions, shipping charges and other commercial deductions.

That is why sellers should not calculate GST reconciliation using only the final bank settlement amount.

Does TCS Apply to Amazon and Flipkart Sales?

For transactions covered by Section 52, an e-commerce operator collects TCS on the net value of taxable supplies made through the platform by other suppliers when the consideration is collected by the operator.

The important point is that TCS is calculated on the relevant net taxable supply value, rather than simply applying the percentage to every amount appearing in a marketplace settlement report.

Returns and other adjustments can affect the net value used for TCS purposes.

Do Amazon and Flipkart Sellers Need GST Registration?

This is one of the most searched questions—and one of the areas where outdated information can cause confusion.

Section 24 of the CGST Act contains compulsory registration provisions for persons supplying goods or services through an e-commerce operator that is required to collect TCS under Section 52. However, GST law also contains specific provisions and notifications that can affect registration requirements in particular situations.

Therefore, an online seller should not rely on a blanket statement such as:

“Every Amazon seller must have GST registration from the first sale.”

Instead, determine:

• What products or services you sell

• Whether your supplies are taxable

• Whether the marketplace is covered by Section 52

• Whether a specific exemption or special procedure applies

• Whether you make intra-State or inter-State supplies

• Whether you also sell through your own website

• Whether you operate across multiple e-commerce platforms

If you are unsure whether GST registration is mandatory for your Amazon or Flipkart business, get the position checked before listing or scaling your sales.

How Does TCS Credit Work for E-Commerce Sellers?

One common misconception is that TCS deducted by Amazon or Flipkart simply disappears from the seller's settlement.

It does not.

The TCS collected by the e-commerce operator is reported through GSTR-8 and is reflected in the seller's Electronic Cash Ledger. The GST portal treats TCS as a cash-ledger amount rather than ordinary input tax credit.

This distinction matters for bookkeeping and GST return reconciliation.

In simple terms:

Marketplace sale → TCS collected → GSTR-8 reporting → Electronic Cash Ledger → Eligible GST payment/refund process

The seller should regularly check whether the TCS appearing in the GST portal agrees with the marketplace records.

What Is GSTR-8?

GSTR-8 is the statement filed by an e-commerce operator for TCS collected under Section 52.

The marketplace reports relevant details of supplies and TCS collected through this return.

For sellers, the important task is not filing GSTR-8 themselves. Instead, sellers should use marketplace settlement information and GST portal data to verify that their TCS has been reported correctly.

This is especially important when a business sells through more than one platform.

How Should Amazon and Flipkart Sellers Reconcile GST and TCS?

Monthly reconciliation is one of the most important controls for an e-commerce business.

Ideally, compare at least these three sources:

1. Sales recorded in your books

Your accounting system should reflect your actual marketplace sales, returns, credit notes and other relevant transactions.

2. Marketplace settlement reports

Review the reports downloaded from Amazon, Flipkart or other platforms.

These may contain:

• Gross sales

• Returns

• Refunds

• Marketplace fees

• Commission

• Shipping charges

• Other deductions

• TCS

• Net settlement

3. GST portal data

Compare the TCS reported by the e-commerce operator with the amount appearing in your GST records and Electronic Cash Ledger.

Why is this reconciliation important?

A seller may have ₹1 lakh in marketplace sales but receive a significantly lower bank settlement after commissions, shipping, refunds, TCS and other deductions.

Using the bank credit as the basis for GST accounting can therefore produce inaccurate figures.

Amazon vs Flipkart GST and TCS: Is There a Difference?

From a GST TCS perspective, the underlying Section 52 mechanism does not become a different tax merely because you use Amazon instead of Flipkart.

However, the format and structure of marketplace reports can differ.

If you sell through Amazon, Flipkart, Meesho and your own website simultaneously, maintaining separate sales and settlement records becomes even more important.

Does TCS Apply to Your Own Website?

Generally, Section 52 TCS is different from selling your own products through your own website.

CBIC's GST FAQ explains that where a person sells their own products through a website, Section 52 TCS is not required merely because the website is being used for the seller's own sales. The transactions remain subject to the applicable GST rules.

This distinction becomes important for D2C brands that sell through:

• Amazon

• Flipkart

• Their own website

• Social commerce channels

• Other marketplaces

Your accounting system should identify these channels separately.

Common GST & TCS Mistakes Made by E-Commerce Sellers

Mistake 1: Treating TCS as a marketplace expense

TCS should not simply be booked as a normal selling expense.

It needs to be appropriately tracked because it is reported against the seller and reflected in the Electronic Cash Ledger.

Mistake 2: Reconciling only the bank settlement

The amount credited to your bank account may be after several marketplace adjustments.

Always reconcile sales, returns, deductions, TCS and settlements.

Mistake 3: Using gross sales without considering returns

TCS under Section 52 is based on the relevant net value of taxable supplies, so returns and adjustments need to be considered.

Mistake 4: Treating TCS as normal input tax credit

TCS reflected in the Electronic Cash Ledger should not be confused with regular ITC appearing in the relevant GST credit statements.

Mistake 5: Managing multiple marketplaces in one combined figure

Amazon, Flipkart and your own website can have different settlement structures.

Separate channel-wise accounting makes reconciliation easier.

Mistake 6: Waiting until year-end

A year-end reconciliation of 12 months of marketplace transactions can become unnecessarily complicated.

Monthly reconciliation is a better approach.

GST Compliance Checklist for Amazon and Flipkart Sellers

Use this checklist every month:

• Verify GST registration applicability for your business model

• Download Amazon/Flipkart settlement reports

• Reconcile marketplace sales with accounting records

• Check returns, refunds and cancellations

• Verify TCS reported by the marketplace

• Check the Electronic Cash Ledger

• Reconcile GST sales data with marketplace records

• File applicable GST returns on time

• Track Amazon, Flipkart and own-website sales separately

• Review unusual TCS or settlement mismatches promptly

Frequently Asked Questions About GST and TCS for Amazon & Flipkart Sellers

Q1) What is the TCS rate for e-commerce sellers in 2026?

Ans: The current GST TCS rate under Section 52 is 0.5% of the relevant net value of taxable supplies covered by the provision: 0.25% CGST + 0.25% SGST/UTGST for intra-State supplies, or 0.5% IGST for inter-State supplies. The reduced rate took effect on 10 July 2024.

Q2) Do I need GST registration to sell on Amazon or Flipkart?

Ans: GST registration requirements depend on the applicable GST provisions, the nature of your supplies and whether the e-commerce operator is required to collect TCS. Section 24 contains compulsory registration provisions for relevant e-commerce supplies, while specific exemptions or procedures may apply in certain cases.

Q3) How do I check my Amazon or Flipkart TCS credit?

Ans: Check the TCS reported by the marketplace against your GST records and Electronic Cash Ledger. The TCS collected by the e-commerce operator is reported through GSTR-8 and reflected in the seller's Electronic Cash Ledger.

Q4) What is GSTR-8?

Ans: GSTR-8 is the statement filed by an e-commerce operator for TCS collected under Section 52. Sellers should reconcile their marketplace records with the TCS reported by the operator.

Q5) Does TCS apply to sales through my own website?

Ans: Section 52 TCS is generally not collected merely because you sell your own products through your own website. The GST treatment of the underlying sales still applies.

Q6) What happens if my marketplace TCS does not match my GST records?

Ans: A mismatch should be investigated rather than ignored. Common causes include returns, cancellations, timing differences, incorrect accounting, marketplace adjustments or differences between settlement reports and GST data.

Q7) Is TCS an extra cost for e-commerce sellers?

Ans: TCS is not simply a marketplace fee. It is a tax collection mechanism under Section 52, and the amount collected is reflected in the seller's Electronic Cash Ledger.

Q8) Should Amazon and Flipkart sales be reconciled every month?

Ans: Yes. Monthly reconciliation makes it easier to identify missing TCS, sales differences, returns, settlement discrepancies and accounting errors before they accumulate.

Key Takeaways for Amazon and Flipkart Sellers

If you sell online in 2026, keep these five points in mind:

1. The current Section 52 TCS rate is 0.5% where applicable.

2. TCS is based on the relevant net value of taxable supplies.

3. TCS collected by the marketplace is reflected in the Electronic Cash Ledger.

4. GST registration requirements should be checked against your exact business model rather than relying on generic marketplace advice.

5. Monthly GST, sales and TCS reconciliation can prevent avoidable compliance and cash-flow problems.

Need Help With GST and E-Commerce Accounting?

Managing Amazon and Flipkart sales becomes more complicated as your order volume, product range and number of sales channels increase.

Instead of checking marketplace settlements manually at the end of the year, businesses can use a structured e-commerce accounting and GST reconciliation process to keep sales, settlements, TCS and GST records aligned.

Finaccle Advisory helps businesses with e-commerce accounting, GST registration, GST compliance and marketplace reconciliation across India.

If you are selling through Amazon, Flipkart, your own website or multiple online channels, our team can review your current process and identify reconciliation gaps.

Get Your GST & TCS Compliance Checked

Need help with Amazon or Flipkart GST reconciliation?

Talk to a Finaccle GST expert about your business, marketplace sales and TCS reconciliation requirements.

Call: +91 7285878602

Book a Consultation: https://www.finaccle.in/contact-us