Like Income Tax, GST also Introduce the concept of Tax Collected at Source (TCS). TCS on GST is applicable from 1st October, 2018.

There are large numbers of sellers on E-Commerce portals, many of them are unaware about the TCS deduction by E-commerce operator and how to get credit of TCS deducted.

What is TCS (Tax Collected at Source)?

TCS is a Tax which is deducted from the payment made to online sellers.

Who is Liable to deduct?

E-Commerce Operator like Amazon, Flipkart or Snap Deal has liable to deduct TCS amount from the payment made to their online sellers.

Rate of deduction and Calculation:

There is no threshold limit for TCS. TCS is deducted at 1% (0.5% CGST & 0.5% SGST or 1% IGST) on the Actual Sale Amount of the month.

Actual Sale = (Total Sale for the Month) – (Sales Return)

For Example: Mr. Amit of Gujarat is a registered vendor of Amazon.

Sale in Gujarat Sales Return in Gujarat Actual Sale (Sales – Sales Return) TCS Calculation
10000 1000 9000 CGST=9000*0.5% = 45
SGST =9000*0.5% = 45

Sale Outside Gujarat Sales Return Outside Gujarat Actual Sale (Sales – Sales Return) TCS Calculation
10000 1000 9000 IGST=9000*1% = 90

Amount Remittance by E-Commerce Operator to Online Seller:

Total Actual Sale Amount – TCS Amount

= (9000+9000) – (45+45+90)

= 17820/-

Who is responsible to make payment to government?

E-Commerce Operator by filling GSTR-8 Return make payment of TCS deducted amount to government.

Credit available for TCS Deducted?

The Registered Sellers of E-Commerce portals can get full credit of TCS deducted by E-Commerce Operator.

How to get the TCS Credit?

The Registered Sellers of E-Commerce portals can get full credit of TCS deducted by filling “TDS and TCS Credit Receivable return” on GST Portal.

Steps to file TCS credit receivable Return:

1. Log in to Portal

2. Go To Services -> Returns ->  TDS and TCS Credit Received

3. Select Financial Year and Tax Period

4. Click Prepare Online

5. Go to tab TCS Credit

6. Accept or Reject the credit

7. File the return using DSC or EVC

After filling the return the Credit will be transfer to your Cash Ledger which you can use for making payment of Tax.

Author Bio

Qualification: CA in Job / Business
Company: SSBI exports
Location: Ahmedabad, Gujarat, IN
Member Since: 01 May 2020 | Total Posts: 3

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4 Comments

  1. JOHNEY says:

    Sir,
    Can we take input on TCS credit auto populated on 2A (part C) and the amount credited to the cash ledger when we accept the TDS or TCS return on the return dashboard both?.(This reflected on 2A and cash ledger)

    1. insight says:

      Dear Joheny,

      For taking credit of TCS & TDS we have to file ” TDS & TCS Receivable” Return. After filling this the amount will be transfer to your Cash Ledger.

      You can not take TCS & TDS Credit to your Credit Ledger. The Reflation of Credit in 2A is for information purpose. So please not add your TDS or TCS Credit to your ITC Ledger.

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