Home > GST > GST on E-commerce Sellers – 14 Questions Answered

GST on E-commerce Sellers – 14 Questions Answered

Who is considered as e-commerce operator?

CGST act defines electronic commerce as – ” Electronic Commerce means the supply of goods or services or both, including digital products over digital or electronic network.”

And defines electronic commerce operator as – “Electronic Commerce Operator means any person who owns, operates or manages digital or electronic facility or platform for electronic commerce”

As per the above definition a person who is providing a platform for others to sell goods or services is considered an e-commerce operator. Main examples of such operators selling goods are Amazon, Flipkart, Snapdeal and operators selling services are Uber, Ola, Swiggy, Urban Clap.

A person selling goods or services through his personal website is NOT an e-commerce operator and therefore below provisions do not apply to them. He has to charge GST and file returns as a normal dealer.

A businessman has registered on Justdial/Indiamart. A buyer calls such seller and makes a purchase. This transaction is not done through Justdial/Indiamart and therefore cannot be considered as an e-commerce operator transaction. The difference in this model is that the transaction is not taking via platform and also Justdial/Indiamart is charging the business for listing or premium listing and not charging a specific percentage of commission on sales.

E-commerce Operators Registration Requirement

E-commerce operators have to register regardless of the turnover. Threshold limit of Rs. 20 lakh/10 lakh is not applicable to e-commerce operators. They are not allowed to register under the composition scheme.

E-commerce sellers Registration Requirement

Persons who sell goods/services through an e-commerce operator are e-commerce sellers. They may be selling goods/services through one or more e-commerce operators and may also sell through their shops/office along with such platforms.

Such sellers can be classified into three categories for the purpose of applicability of GST provisions. They are

1) Selling goods – Such sellers are required to get registered under GST even if there turnover is less than the threshold limit of Rs. 40/20/10 lakh. It means they are required to register before selling through the e-commerce platform. All platforms like Amazon, Flipkart etc. required GSTIN at time of registration as a seller on their platform.

2) Selling services other than mentioned in Section 9(5) – Such sellers are required to register and collect GST only if there turnover is more than the threshold limit of 20/10 lakh. And if they are not registered then GST is not liable on such transaction done through e-commerce operator.

3) Selling services mentioned in Section 9(5) – Such sellers are not liable to register under GST even if their turnover is more than the threshold limit.

A person who is selling goods/service through e-commerce operator cannot take registration under composition scheme. He needs to get registered under regular scheme only.

What is section 9(5) and Services covered under Section 9(5) of CGST Act?

Section 9(5) states that the government may specify the categories of services on which e-commerce operator is liable to collect and pay GST as if e-commerce operator is providing the service. All the provision will apply to such e-commerce operator and not the persons selling services through him.

The categories of services specified by the government under this section

  1. Services by way of transportation of passengers by a radio-taxi, motorcab, maxicab and motorcycle for example – Ola, Uber. So, if a person is operating five cars through uber and has a turnover of Rs. 25 lakh then also he is not required to register.
  2. Services by way of providing accommodation in hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes, except where the person supplying such service through electronic commerce operator is liable for registration due to turnover beyond threshold limit. For example – Goibibo, MakeMyTrip. Therefore if a hotel has a turnover of more than Rs. 20/10 lakh then section 9(5) is not applicable and the hotel itself is liable to get registered and pay GST.
  3. Services by way of housekeeping, such as plumbing, carpentering, except where the person supplying such service through electronic commerce operator is liable for registration due to turnover beyond the threshold limit.

Who is liable to collect and pay GST – E-commerce operator or e-commerce sellers

1) Selling Goods – The e-commerce seller is liable for the collection of GST and pay to the government.

2) Selling services other than mentioned in Section 9(5) – The e-commerce seller is liable for collection of GST and pay to the government.

3) Selling services mentioned in Section 9(5) – The e-commerce operator is liable to collect and pay GST to the government.

Industry Wise analysis and Comparison

Industry Examples of E-commerce Operator Seller Registration Requirement GST Collection
Selling Goods Amazon, Flipkart, Snapdeal Seller required to register. Seller is required to collect GST.
Hotel (Turnover of hotel less than 20/10 lakh) Goibibo, OYO, MakeMyTrip Hotel is not required to register. E-commerce operator will collect GST.
Hotel (Turnover of the hotel more than 20/10 lakh) Goibibo, OYO, MakeMyTrip Hotel is required to register. Hotel is required to collect GST.
Cab Aggregator (Irrespective of turnover) OLA, Uber Car owner required to register only if his turnover other than through cab aggregators is more than 20/10 lakh. Cab aggregator is required to collect GST even if the car owner is registered.
House Keeping Services (Turnover of hotel less than 20/10 lakh) Urban Clap Service provider is not required to register. E-commerce operator will collect GST.
House Keeping Services (Turnover of hotel less than 20/10 lakh) Urban Clap Service provider is required to register. Service Provider is required to collect GST.
Other Service including Food aggregators* Swiggy, Uban Eats, Urban Clap (Beautician) Service provider is required to register if turnover is more than 20/10 lakh. Service provider is required to collect GST if registered. If not registered then GST not applicable.

*Restaurant is considered as a service and not composite supply as per Schedule II of CGST Act.

Also Read – TCS by e-commerce operator

About Prateek Agarwal

Prateek Agarwal is a Practicing Chartered Accountant from Jaipur and been in practice for more than 7 years. He writes mainly about GST and Finance.

13 comments

  1. VISHAL CHANDAK

    Hi, I wish to start an eBay type of platform. The platform will mask the identity of both buyers and sellers. On record the transaction will happen such that the operator buys from the seller and then sells to the buyer. The individual turnover of the sellers would be less than 10 lakhs. Do the sellers still need to have a GST registration. The operator will have a GST registration.

    • Rohit Pithisaria

      It is mandatory for the seller to register under GST if he wants to sell on the eCommerce platform even if the total turnover is less than 20 or 40 lakhs.

  2. Nitesh ahlawat

    Hello sir I want to know what is GST? What type of Gstin required to sell on e-commerce portal like amazon or flipkart? How many times a e-commerce seller needs to fill the GST in a year and how?

    • Rohit Pithisaria

      You have to get registered yourself as a Normal taxpayer (not composition) for online selling on Amazon, Flipkart etc. You are required to file GSTR3B every month and GSTR1 on a quarterly basis. Let us know if you need any help in GST registration or return filing.

  3. I have five cars purchased under firm name. GST Registered. I have attached all my cars for ola. How can I claim gst paid by ola?

    • Prateek Agarwal

      In case of ola/uber, gst is to be paid by the company (ola/uber) itself. So, you are not required to pay any GST. GST is charged by the company on commission invoices issued to you. You can take input tax credit of such GST on basis of such commission invoices.

  4. I am registered as a regular tax payer and having android app for recharge and utility recharge am applicable to collect tcs my business

    • Prateek Agarwal

      I think you uses various companies api to recharge and pay utility bills. In that case, you are not providing platform to other persons. So you are not required to collect TCS.

  5. so our Turnover is above 20 lacs , i am registered in GST, Providing Hotels services through OYO Rooms .
    We have rooms where we charge less than 1000 and room where we charge more than 1000 but less than 2000.
    Q1. Do i need to pay gst on rooms where tariff is less than 1000 ?
    Q2. Oyo charges 20% commission on booking amount +18% GST on commission amount , Can i claim ITC of gst paid on commission ?
    Q3. If yes on Q2, can i claim 100 % ITC on commission or do i need to reverse ITC for exemted supplies of tariff less than 1000 Rs.

    • Prateek Agarwal

      Q1 – No, GST is not applicable to hotel rooms with a tariff of less than Rs. 1000 per night.
      Q2 – Yes, you can claim such GST paid as input.
      Q3 – You cannot claim ITC for GST paid on commission related to exempted supplies.

  6. Do E-commerce operator have to get registered under GST if its turnover is below 20 lacs

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