FAQ on e-commerce under GST

FAQ on e-commerce under GST

E-commerce has emerged as an emerging trend of business in India, there are thousands of suppliers under e-commerce operators, we will discuss about the applicability of GST on the suppliers selling goods or services through an e-commerce platform.

An e-commerce platform/operator is an entity which owns, operates or manages digital or electronic facility or platform for E commerce like Amazon, Flipkart, Google Playstore etc.

Here’s a list of common FAQs on Ecommerce

Also read: Applicability of GST on sellers in e-commerce market place i.e. sellers registered on Amazon, flipkart, Playstore etc.

Question 1: What is Electronic Commerce?

Electronic Commerce has been defined to mean the supply of goods or services or both, including digital products over digital or electronic network i.e. supply of goods or services over & through Amazon, flipkart, Googleplay etc. comes under electronic commerce.

Question 2: Who is an e-commerce operator?

Electronic Commerce Operator has been defined to mean any person who owns, operates or manages digital or electronic facility or platform for electronic commerce i.e. Channels such as Amazon, flipkart etc. are e-commerce operators.

Question 3: Is it mandatory for e-commerce operator to obtain registration?

Yes, the benefit of threshold exemption is not available to e-commerce operators and they are liable to be registered irrespective of the value of supply made by them. Thus the e-commerce operators are liable to get GST registration, even if their turnover is below Rs.20 lakhs.

Question 4: Whether a person supplying goods or services through e-commerce operator would be entitled to threshold exemption?

No, the threshold exemption is not available to such persons and they would be liable to be registered irrespective of the value of supply made by them i.e. the sellers on Flipkart, Amazon etc would be liable to be registered irrespective of the turnover.

Question 5: Will an e-commerce operator be liable to pay tax in respect of supply of goods or services made through it, instead of actual supplier?

Yes, but this would only be applicable in cases where reverse charge mechanism is applicable. In such cases tax shall be paid by the electronic commerce operator if such services are supplied through it and all the provisions of the Act shall apply to such electronic commerce operator as if he is the supplier liable to pay tax in relation to the supply of such services.


Question 6: It is very common that customers of e-commerce companies return goods. How these returns are going to be adjusted?

The value of supplies which are returned are adjusted in the aggregate value of taxable supplies and tax is required to be paid to the government over the net supplies made which would be equal to: aggregate value of taxable supplies of goods or services made during any month (-) aggregate value of taxable supplies returned to the suppliers during the said month.

Question 7: The sellers supplying goods through e-Commerce operators (ECO) may have common places of business, especially if their goods are stored in a shared facility operated by the ECO. This will result in the same additional place of business being registered by multiple suppliers. Is this allowed?

Yes, this is allowed. Any registered person can declare a premises as a place of business if he has requisite documents for use of the premises as his place of business (like ownership document, agreement with the owner etc.) and there is no restriction about use of a premises by multiple persons. The registered person shall have to comply with the requirements of maintaining records as per the GST laws.

Source: http://www.cbec.gov.in



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