GST TCS — E-Commerce Operator Compliance

Section 52 CGST Act: an ECO is a person who owns/operates a digital or electronic facility for supply of goods or services. TCS applies to: every ECO making net taxable supplies through its platform (i.e., where the ECO is not itself the supplier — third-party marketplace model). Rate: 1% of the net value of taxable supplies (0.5% CGST + 0.5% SGST/UTGST, or 1% IGST for inter-state). Deducted at the time of actual payment to the supplier.

GSTR-8 is the TCS return for Electronic Commerce Operators — filed monthly by the 10th of the following month. It reports: TCS collected from each supplier (GSTIN-wise), the net taxable value, and TCS deposited. The supplier's TCS credit appears in their electronic cash ledger automatically on filing of GSTR-8. The supplier can use this credit to set off their GST liability. ECOs must register for GST mandatorily under Section 24(x), regardless of turnover.

Yes — the TCS deducted by the ECO (from the supplier's receivable) is credited to the supplier's electronic cash ledger once the ECO files GSTR-8 for the relevant month. The supplier claims this as a credit against their own GSTR-3B liability. If the credit exceeds the liability, the supplier can claim a refund under Section 54. GSTR-8 must be filed before the supplier's GSTR-3B for the same period to ensure the credit is available.

TCS under Section 52 is not deducted on: (a) supplies of services notified under Section 9(5) — where the ECO is itself the supplier and pays GST as if it were the supplier (e.g., cab services via app, hotel accommodation booked via app); (b) supplies of exempt goods and services; (c) supplies where the ECO is also the seller (own account supplies — not marketplace model). For Section 9(5) supplies, the ECO pays the full GST — TCS does not apply as the supplier-ECO distinction collapses.

Section 9(5) notification (Notification 17/2021-CT): restaurant services provided through ECO platforms (food delivery apps) — the ECO (Swiggy/Zomato) is liable to pay GST at 5% as if it were the supplier, regardless of whether the restaurant is GST-registered or not. The restaurant is not required to pay GST on sales through these platforms — the platform pays. This shifts GST compliance from thousands of small restaurants to a handful of large aggregators.