GST Return Filing for E-commerce Sellers

E-commerce sellers follow the regular GST framework along with additional rules for supplies made through e-commerce operators. Key rules include:

• GST: GST registration depends on the applicable GST provisions. Eligible small sellers of goods can supply through qualifying e-commerce operators without registration, subject to prescribed conditions.
• GST TCS: The TCS amount is credited to the supplier's Electronic Cash Ledger after the applicable TCS reporting and credit process is completed.
• Composition Scheme: Eligible composition taxpayers can supply goods through e-commerce operators under the prescribed procedure. The facility applies from October 1, 2023, subject to conditions such as restrictions on inter-State supplies.
• Section 9(5) Services: For certain notified services supplied through an e-commerce operator, the operator is responsible for paying GST. These supplies have separate reporting requirements.
• Marketplace Reconciliation: Sellers should reconcile marketplace sales with their GST returns, settlement statements, returns, cancellations, credit notes, and TCS data.

The GST treatment therefore depends on the seller's business model, type of supply, registration status, and the role of the e-commerce operator.

GST requirements for e-commerce sellers depend on the type of supply and the nature and mode of supply. Goods and services can have different registration, TCS, invoicing, and place-of-supply rules.

The following table highlights the key GST rules that e-commerce sellers of goods and services should consider:

E-commerce sellers may be subject to different GST returns based on their registration status, turnover, tax scheme, and applicable filing requirements.

Note: GSTR-8 is filed by the e-commerce operator, not the seller. The TCS reported through GSTR-8 is made available to the seller through the GST Portal and is credited to the Electronic Cash Ledger after the applicable process. It is not treated as Input Tax Credit.

Monthly vs Quarterly GST Return Filing for E-commerce Sellers

Eligible e-commerce sellers can file GSTR-1 and GSTR-3B monthly or under the QRMP scheme. The table below explains the key differences in filing frequency and tax payment:

Under QRMP, tax for the first two months of a quarter is generally paid through Form GST PMT-06.

Before filing GSTR-1, reconcile your marketplace data with your books of accounts and GST records. This helps reduce differences between your reported sales and the data available from e-commerce operators.

Step 1: Prepare Your E-commerce Sales Data

Collect the records required for the relevant tax period before entering data on the GST Portal. Keep the following information ready:

• B2B and B2C sales invoices
• Sales made through each e-commerce operator
• Customer GSTINs for B2B supplies
• Credit notes and debit notes
• Sales returns and cancellations
• Export invoices, where applicable
• HSN or SAC details
• Applicable tax rates and place of supply
• E-commerce operator statements and TCS details
• Details of advances, where applicable

For e-commerce sales, reconcile the marketplace statement with your sales register before preparing GSTR-1.

Step 2: Log in to the GST Portal and Select GSTR-1

• Visit the official GST Portal at gst.gov.in.
• Log in using your GST credentials.
• Go to Services > Returns > Returns Dashboard.
• Select the relevant financial year and return period.
• Select GSTR-1.
• Choose Prepare Online or use an applicable offline or GSP-based filing method.

The GST Portal supports online preparation, the Returns Offline Tool, and GSP-based filing.

Step 3: Enter the Required GSTR-1 Details

Enter the transaction details in the applicable GSTR-1 tables.

a. B2B Sales

Report taxable supplies made to GST-registered customers with the required invoice details. These may include:

• Customer GSTIN
• Invoice number and date
• Invoice value
• Taxable value
• Place of supply
• Applicable tax rate
• CGST, SGST/UTGST, or IGST
• Other prescribed invoice details

The GST Portal provides invoice-level reporting for supplies made to registered persons.

b. B2C Large Sales

Report eligible inter-State B2C invoices where the invoice value exceeds ₹1 lakh.

This threshold applies from the August 2024 return period. It replaced the earlier ₹2.5 lakh threshold.

Enter the applicable invoice and place-of-supply details in Table 5 for B2C Large (B2CL) supplies.

c. B2C Other Sales

Report other applicable B2C supplies in the relevant GSTR-1 tables.

For consolidated B2C reporting, classify the supplies based on the applicable place of supply and tax rate. The reporting treatment depends on the nature of the transaction and the applicable GST rules.

d. Credit Notes and Debit Notes

Report applicable credit notes and debit notes in Table 9B.

For e-commerce sellers, these records should be reconciled with marketplace returns, cancellations, refunds, and other adjustments.

e. HSN/SAC Summary

Report the applicable HSN or SAC details in Table 12.

The required information can include the applicable code, description, quantity and value details, taxable value, and tax amounts.

f. Supplies Through E-commerce Operators

E-commerce sellers must report applicable supplies made through e-commerce operators in the relevant GSTR-1 tables.

• Table 14: Covers applicable supplies made through ECOs where the operator collects TCS under Section 52 or pays GST under Section 9(5). The supplier reports the applicable details.
• Table 14A: Used to amend details previously reported in Table 14.
• Table 15: Used by the ECO to report supplies on which it is liable to pay GST under Section 9(5).
• Table 15A: Used by the ECO to amend details reported in Table 15.

g. Amendments and GSTR-1A

Use the applicable amendment tables when correcting details reported in an earlier tax period.

After filing GSTR-1, taxpayers can optionally use GSTR-1A for the same tax period to add missed records or amend records already reported in GSTR-1. It remains available until GSTR-3B for that tax period is filed.

Step 4: Review and File GSTR-1

Review the return carefully before filing. Check:

• Total sales against your books
• B2B invoice details
• B2C sales by place of supply
• Credit and debit notes
• HSN/SAC details
• Marketplace sales
• TCS-related information
• Amendments and GSTR-1A, where applicable

Generate the GSTR-1 summary and review the information displayed on the portal. The GST Portal allows saved invoice details to be changed until GSTR-1 is filed.

Complete the GSTR-1 Filing

After checking the return:

1. Submit the GSTR-1.
2. Select the applicable filing option.
3. Verify the return using EVC or DSC.
4. Complete the filing.
5. Save the generated ARN and acknowledgement for your records.

DSC is not mandatory for any class of taxpayer; eligible taxpayers can use DSC or the applicable electronic verification method.

GSTR-1 Due Date for E-commerce Sellers

The general due date for monthly GSTR-1 filers is the 11th of the following month.

For taxpayers filing quarterly under QRMP, GSTR-1 is generally due on the 13th of the month following the quarter.

For example:

The government may extend filing deadlines through notifications. Check the GST Portal for any extension applicable to the relevant tax period.

Note: GSTR-1 is only one part of e-commerce GST compliance. Sellers should also reconcile marketplace sales with TCS data, returns, cancellations, credit notes, settlements, and other GST records before filing the return.

Filing GSTR-3B for an e-commerce business requires accurate sales, GST liability, ITC, and TCS reconciliation. RegisterKaro helps you prepare and file the return after reviewing the relevant GST records and marketplace data.

Step 1: Share Your GST and E-commerce Records

Provide your sales data, marketplace statements, purchase records, GSTR-1 details, GSTR-2B, and TCS information. We review these records to identify differences before filing.

Step 2: Reconcile Sales and Tax Liability

We reconcile your marketplace sales with your books and GST records. This includes sales returns, cancellations, credit notes, GST liability, and applicable reverse charge transactions.

Step 3: Review ITC and IMS Records

We review GSTR-2B and the relevant Invoice Management System (IMS) records before determining eligible ITC. IMS allows recipients to accept, reject, or keep supplier records pending. Records with no action are generally treated as accepted when GSTR-2B is generated.

Step 4: Reconcile and Apply TCS Credit

We match TCS reported by the e-commerce operator with your marketplace records and GST data. TCS is not treated as ITC. Once accepted through the GST Portal's TDS and TCS Credit Received facility, it is credited to the Electronic Cash Ledger.

Step 5: Prepare and File GSTR-3B

We prepare the applicable GSTR-3B tables based on the reconciled data, including outward tax liability, reverse charge, eligible ITC, and other applicable details. We also review the return before filing.

For the applicable tax periods, corrections to outward tax liability should be made through GSTR-1A where required, rather than directly changing the auto-populated outward liability in GSTR-3B.

Step 6: Complete Filing and Maintain Records

After reviewing the final liability and available cash balance, we complete the GSTR-3B filing and help maintain the filed return and supporting records for future reconciliation.

E-commerce sellers should reconcile their sales, marketplace data, TCS, and ITC before filing GSTR-3B.

The core GSTR-3B preparation and filing steps are the same as any registered taxpayer; explore GST Return Filing. For e-commerce sellers, the added focus is TCS credit (via "TDS and TCS Credit Received") and marketplace reconciliation.

Not every seller needs a GSTIN simply because they sell goods through an e-commerce platform.

Eligible small goods sellers can make supplies through a qualifying e-commerce operator without GST registration if they meet the conditions under the prescribed procedure. These conditions include restrictions on inter-State supplies, turnover limits, PAN requirements, and other applicable conditions.

Before making supplies, an eligible unregistered seller must obtain an enrolment number on the GST common portal. The e-commerce operator can allow supplies only after this enrolment number has been allotted.

However, individual platforms may have their own seller onboarding and documentation requirements. These platform requirements should not be confused with GST rules.

Therefore, a seller should first check whether GST registration is legally required, and if eligible for the exemption, complete the enrolment process before making supplies. The seller should then check the registration and documentation requirements of the specific e-commerce platform.

TCS reconciliation should be performed separately from ITC reconciliation. Regularly compare your marketplace, GST, and settlement records to identify differences before filing returns.

During reconciliation, check the operator's GSTIN, taxable value, TCS amount, returns, cancellations, and reporting period. Use GST number search to confirm the operator's GSTIN is valid if something looks off. If the marketplace statement and GST Portal data do not match, identify and resolve the difference before relying on the TCS credit for tax payment.

Regular reconciliation can help prevent incorrect reporting and missed TCS credits.

GSTR-8 connects the TCS collected by an e-commerce operator with the TCS credit available to the seller on the GST Portal.

The e-commerce operator (ECO) files GSTR-8 when it is required to collect TCS under Section 52. The statement reports the applicable taxable supplies made through the platform, supplies returned, and TCS collected.

GSTR-8 is generally due by the 10th of the following month.

How Does GSTR-8 TCS Credit Reach the Seller?

The TCS reported by the ECO through GSTR-8 becomes available to the seller through the GST Portal's TDS and TCS Credit Received facility. The seller can review and accept or reject the reported entries.

Once processed, the accepted TCS credit is reflected in the seller's Electronic Cash Ledger. TCS is not Input Tax Credit (ITC). It can be used to pay eligible GST liabilities.

Late or incorrect GST filing can result in late fees, interest, penalties, or other compliance action. The exact consequence depends on the type of default and the applicable GST provisions.

GST Late Filing Fees and Interest

A late fee applies when you file GSTR-3B after the due date. The general late fee is ₹50 per day for a return with tax liability and ₹20 per day for a Nil return, subject to the applicable maximum limits.

Interest generally applies when GST remains unpaid after the due date. The notified rate for delayed payment of tax is 18% per annum.

Penalties for Incorrect GST Filing

Incorrect reporting can lead to tax recovery, interest, and penalties, depending on the nature of the error.

For example, wrongly claimed ITC or short-paid tax may require reversal or payment of the applicable amount, along with interest and penalty where applicable. Section 74A provides the current framework for determination of tax pertaining to FY 2024-25 onward. Sections 73 and 74 continue to apply to the relevant periods up to FY 2023-24.

For e-commerce sellers, common issues include:

• Differences between marketplace sales and GST returns
• Incorrect credit notes for returns or cancellations
• TCS mismatches with marketplace records
• Incorrect or ineligible ITC claims
• Short payment of GST

Can GST Registration Be Canceled for Non-Filing?

Continuous non-filing can lead to cancellation of GST registration under Section 29(2) of the CGST Act.

• Regular taxpayers: Non-filing for a continuous period of six months can be a ground for cancellation.
• QRMP taxpayers: For taxpayers filing quarterly returns under the proviso to Section 39(1), non-filing for two consecutive tax periods, meaning two quarters, can lead to cancellation.
• Composition taxpayers: Non-filing of the return for a financial year beyond three months from its due date can be a ground for cancellation.

Cancellation does not remove outstanding tax, interest, penalty, or other liabilities for earlier periods. Once a registration is cancelled, restoring it involves a separate process, covered in GST cancellation and revocation.

How Can E-commerce Sellers Avoid GST Filing Issues?

Before filing, reconcile your:

• Marketplace sales with your sales records
• GSTR-1 with GSTR-3B
• Returns and cancellations with credit notes
• TCS records with marketplace statements
• GSTR-2B with eligible ITC

Regular reconciliation helps identify errors before they result in additional GST liability or compliance action.