Under Section 52 of the CGST Act, an e-commerce operator must collect tax at source (TCS) on the net value of taxable supplies made through its platform where it collects the consideration. The TCS is deposited monthly, reported in Form GSTR-8, and credited to the supplier's electronic cash ledger to set off against output tax.
Who must collect TCS
Section 52 applies to an e-commerce operator (ECO) that owns or manages a digital platform and collects the consideration on behalf of suppliers. The ECO must take a separate TCS registration in each State/UT where suppliers are located. TCS does not apply where the ECO is itself liable to pay tax on the supply under Section 9(5) (for example, restaurant services through the platform).
Rate and base
TCS is collected on the net value of taxable supplies = aggregate taxable supplies made through the platform, less supplies returned, in the month. The notified rate is 0.5% under CGST + 0.5% under SGST (1% total) for intra-State supplies, and 1% IGST for inter-State supplies; the rate was reduced for certain periods. Verify the current notified TCS rate before applying.
Example. Net taxable supplies through the platform in a month = Rs.10,00,000. TCS at 1% = Rs.10,000 (Rs.5,000 CGST + Rs.5,000 SGST), collected by the ECO and deposited to the Government.
Compliance and GSTR-8
| Obligation | Form / timeline |
|---|---|
| Monthly TCS statement | GSTR-8 by the 10th of the next month |
| Deposit of TCS | With GSTR-8 |
| Annual statement | GSTR-9B (where notified) |
| Supplier's credit | Auto-populated; claimed via the cash ledger |
Impact on the supplier
The TCS collected reflects in the supplier's Form GSTR-2X/electronic cash ledger and can be used to discharge output tax. Suppliers selling through marketplaces should reconcile platform sales with their own GSTR-1 and the TCS credited in GSTR-8, as mismatches are a common audit query. Note that GST TCS under Section 52 is distinct from income-tax TDS under Section 194-O on e-commerce.
Key takeaways
- ECOs collect TCS on net taxable supplies where they collect the consideration.
- Rate: 0.5% CGST + 0.5% SGST (1%) / 1% IGST — verify current notification.
- Monthly Form GSTR-8 by the 10th; credit flows to the supplier's cash ledger.
- GST TCS (Sec 52) is separate from income-tax TDS under Section 194-O.