TCS in Goods and Service Tax (GST) – Registration, Refund, Rate
TCS means tax collected at source by the E-commerce operator. When a supplier supplies goods and services through online platform of e-commerce operator and the payment for that supply is collected or received by the E-commerce operator at that time tax is collected.
Who have to charge TCS in GST?
TCS under GST is applicable only on E-commerce operators. For example, Amazon, Flipkart, Jabong etc. For instance, X is selling clothes through Amazon. Now, if X made a sale and Amazon receives the payment on behalf of X. At the time of paying the amount of sale to X, Amazon will deduct TCS.
However, the e-commerce operators falling under the below categories are not liable to collect TCS-
- Supplying exempted goods or services.
- Supplies of services notified under section 9 (5) of the Act-
- Hotel accommodation/ clubs (unregistered suppliers)
- Transportation of passengers – radio taxi, motor cab or motorcycle.
- Housekeeping services like plumbing, carpentry etc. (unregistered suppliers)
When to collect TCS?
TCS is collected by an E-commerce operator on making payment to the supplier of the goods or services.
What is the Rate of Tax Collection at Source?
Rates of TCS under GST are-
- CGST- 0.5%,
- SGST- 0.5% and
- IGST- 1% on the net value of taxable supplies.
Net value of taxable supplies means Total value of taxable supplies (-) sales return taxable supplies
Note: If returns are more than the supplies made during any tax period, the same would be ignored in current and adjusted in next tax period.
What are the Registration Provisions under Goods and Service Tax?
E-commerce operator: Every E-commerce operator need to compulsorily register under GST.
E-commerce Suppliers: Supplier supplying goods or services through an operator need to compulsorily register under GST except suppliers who make supplies under section 9(5) of CGST Act. However, service providers having turnover below the threshold limit are not required to register under GST.
What is the Time limit of depositing Tax Collected?
The TCS collected by the E-commerce operator shall be deposited to the Government within 10 Days after the end of the month in which tax is collected. For example, if Amazon collected TCS of amount Rs 1 lakh in January then it shall deposit the tax collected to the government on or before 10th February.
Which Return/Form to file by E-commerce operator?
E-commerce operator has to fill GSTR-8 within 10 days after the end of such month. For instance, the due date of GSTR-8 for the month of January will be 10th February.
The E-commerce operators are also required to file an Annual Return in form GSTR-9B by the end of following financial year before 31st of December.
Is TCS (Tax Collected at Source) refundable or not? or Whether Credit of tax collected available to supplier?
The Tax collected in GST is a type of advance tax. The tax collected by the E-commerce operator once deposited will be shown in electronic cash ledger of the respective suppliers. The supplier can claim the credit after matching and reconciling the details filled by the E-commerce operator in form GSTR-8 with own books of accounts.
When officer can issue Notice to the Operator?
An authorised officer can issue Notice to an E-commerce operator to furnish the details relating to volume of the goods/services supplied, stock of goods lying in warehouses, etc.
How to File GSTR-8?
Here are the following steps to file GSTR-8 online-
Step 1: Login to GST Portal.
Step 2: Go to Services > Returns > Returns Dashboard.
Step 3: Select Financial year, month and click on “PREPARE ONLINE”.
Step 4: The following screen will appear. Fill the required details in the tables:
In the Table no. 3:- Details of TCS collected during the month is to be furnished. In the Table no. 4: “Amendment to details of Supplies attracting TCS”-In this table you can Amend TCS details filled in earlier months. Click on the Table No.-3 and Click on add.
Enter the following details:
- GSTIN of Supplier
- The gross value of supplies made
- Value of supplies returned
- Tax Collected under heads IGST/ CGST/ SGST.
- And click on Save.
Step 5: Go back and click on “Preview GSTR 8” once the details updated. Verify and click on “Proceed to File”.
Step 6: After this fill the challan, pay the tax and click to “File GSTR-8”. File GSTR-8 with Digital Signature or EVC.
For any questions, you may reach us at Discussion Forum
The author of the above article is Punit Chaplot.
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