GST TCS on Marketplace Sales: the 0.5% Rate, GSTR-8 and How You Get It Back

GST TCS (tax collected at source) is a small slice of your sales that Amazon, Flipkart and other marketplaces hold back from your payout and pay to the government for you. As of November 2026 the total rate is 0.5% of your net taxable sales: 0.25% CGST plus 0.25% SGST on sales within your state, or 0.5% IGST on sales to other states. It has been 0.5% since notification 15/2024-Central Tax dated 10 July 2024; before that it was 1%. It is not an extra cost: you get it back through your GST cash ledger.

What is GST TCS under section 52?

Section 52 of the CGST Act makes the e-commerce operator, not an agent, collect a notified percentage of the net value of taxable supplies made through it, where the operator collects the consideration. The amount collected is called tax collection at source, or TCS.

CBIC's own explainer puts it simply: the marketplace pays the seller the price less the TCS, and the base is the net value of what was supplied through the portal. That explainer was written in 2017 and still shows the old 1% rate, so use it for the mechanism and not for the number.

The duty to collect and deposit sits with the marketplace. Your part is to be registered, report your sales correctly and use the credit.

What is the TCS rate in 2026?

The split follows the 10 July 2024 notification. The GST Council's FAQ, last updated 30 November 2018, still shows the original 0.5% per Act and 1% IGST, so that document is out of date on the rate.

How is TCS worked out?

TCS = (taxable sales in the month - taxable returns in the month) x TCS rate.

The FAQ defines the "net value of taxable supplies" as the taxable supplies made through the operator in a month by a registered supplier, less the supplies returned to that supplier in the same month, and says it is calculated at GSTIN level. If returns are higher than sales in a month, the excess is ignored for that month and later months; a negative figure cannot be reported.

For example, in October you sell goods with a taxable value of ₹8,00,000 and customers return goods worth ₹80,000 in the same month. Net value is ₹7,20,000, and TCS at 0.5% is ₹3,600. Run your own numbers in the GST TCS calculator. We read the base as taxable value without GST on top; confirm which base your marketplace uses from your settlement or tax report.

TCS falls due when the supply is made through the operator, not when the money is collected. The FAQ's example: a supply on 30 October is reported in October's statement even if the money comes in November. So a sale at the end of the month can show TCS in a different settlement than you expect.

Who has to register, and what is GSTR-8?

Anyone supplying goods through an e-commerce operator must register for GST, whatever their turnover, and the usual ₹20 lakh threshold does not apply to them. The GST Council FAQ adds one exception, for certain services suppliers below the threshold. If you sell goods on a marketplace, assume you need a GSTIN; the 2024 rule on state registrations is in GST rule 14B for e-commerce.

The marketplace files FORM GSTR-8 electronically, showing outward supplies made through it, returns, and the TCS collected, within 10 days after the end of the month. It also files an annual statement in GSTR-9B by 31 December after the financial year. So for sales in October, GSTR-8 is due by 10 November.

Where does the TCS show up for you?

After the operator files GSTR-8, the TCS deposited appears in your electronic cash ledger under the matching tax head: central, state or integrated tax. It does not appear as input tax credit. You use it when you pay your GST liability. The steps are in how to claim TCS credit.

Your marketplace also shows the TCS in its tax or settlement reports. Which report and what it is called differs by platform and sits inside the seller portal; we have not confirmed the exact report names, so check your own dashboard.

What happens if my sales and the marketplace's GSTR-8 do not match?

The GSTR-8 data is matched against your own GSTR-1. As summarised by a GST tax portal, differences are communicated to both parties, and if they are not resolved your output tax liability can be increased, with interest. That summary was truncated and is not official text; read section 52(8) to 52(11) of the CGST Act with your accountant.

The practical lesson: report the same sales in GSTR-1 that the marketplace reports in GSTR-8, split by the same state. If you find an error in your own GSTR-1 before you file GSTR-3B, see GSTR-1A.

What is not covered by TCS?

The FAQ says TCS is not collected on exempt supplies or on supplies where the recipient pays tax under reverse charge. A composition taxpayer cannot make supplies through an e-commerce operator at all. Check your product's rate in the GST rate finder.

Is TCS the only deduction from my payout?

No. Referral fee, closing fee, shipping fees and GST on those fees also come off your settlement, and income tax TDS under section 194-O may apply as well. The two taxes are different; see 194-O TDS vs GST TCS and the fee guides for Amazon and Flipkart.

This page is general information, not tax or legal advice. Confirm your position with a chartered accountant or GST practitioner.

FAQ

What is the GST TCS rate on Amazon and Flipkart in 2026? The total is 0.5%: 0.25% CGST plus 0.25% SGST for intra-state sales, or 0.5% IGST for inter-state sales, since 10 July 2024. Before that it was 1%.

Do I pay TCS or does the marketplace? The marketplace collects it from your payout and deposits it with the government. You do not pay it separately. It then appears in your cash ledger for you to use.

Is TCS an extra cost for my business? Not by itself. It is an advance deposit against your GST. It reduces your cash payout in the month, which affects cash flow, but you recover it by using it against GST payable or by claiming a refund of the excess.

Is TCS charged on returns? It is charged on sales net of returns in the same month, per GSTIN. If returns exceed sales in a month, the excess is ignored and not carried forward.

When does the TCS show in my GST account? After the marketplace files GSTR-8, which is due within 10 days after the month ends. If it has not appeared by the middle of the month, ask the marketplace whether it has filed.

Can I claim TCS as input tax credit? No. The FAQ routes it to the electronic cash ledger, from where you use it to discharge tax liability, or claim a refund of the excess balance under section 54(1).

Is GST TCS the same as TDS under 194-O? No. TCS is GST collected under section 52 of the CGST Act. 194-O is an income tax deduction. Both can apply to the same sales, with separate returns and credit routes.

Next step

Matching TCS in your cash ledger against settlement reports every month is easy to put off. Blooprint's Amazon account management team works with sellers on settlements, reports and marketplace operations across Amazon and Flipkart.