01/09/2025
Day 3 of the 15 Days eCommerce Challenge focuses on one of the most critical aspects of online selling – GST compliance for eCommerce businesses. Most sellers make mistakes in GST filing which later turn into notices and penalties. In this reel, I am breaking down the important GST points that every seller on Amazon, Flipkart or any eCommerce platform must understand clearly.
Sales in eCommerce can be both B2C (to individual consumers) and B2B (to GST registered businesses). For B2C, invoices are issued without GSTIN and tax depends on the place of supply. For B2B, the buyer’s GSTIN must be mentioned on the invoice, and proper reporting is required. Another crucial point is the treatment of intra-state and inter-state sales. Intra-state supplies attract CGST + SGST while inter-state supplies attract IGST. Since eCommerce platforms deliver PAN India, inter-state sales are extremely common.
Returns, cancellations, debit notes and credit notes must be handled carefully. Returns and discounts are adjusted through credit notes while any undercharged amount is rectified by issuing debit notes. Stock transfers between branches in different states or under FBA (Fulfilled by Amazon) arrangements are also treated as supply and require GST compliance.
In GSTR-1, sellers are required to report outward supplies, adjustments through debit/credit notes, HSN summary, documents issued and supplies made through eCommerce operators. GSTR-3B is the monthly summary return where tax liability, ITC and payment details are declared.
One of the most important compliance steps for eCommerce sellers is reconciliation with TCS. Marketplaces like Amazon and Flipkart deduct TCS at 1% and file GSTR-8. Sellers must reconcile their sales state-wise with these TCS reports. If your Delhi warehouse supplies to customers in Maharashtra or UP, the sales must exactly match the state-wise breakup in the operator’s report. A mismatch is the most common reason for GST notices in eCommerce.
The golden rule is simple – understand B2B and B2C correctly, apply intra vs inter-state rules properly, account for returns with credit notes, and most importantly, reconcile your sales state-wise with TCS reports before filing. This discipline will protect your business from unnecessary penalties and ensure smooth compliance.
