E-Commerce business is the new and one of the most valuable business platforms these days. It has been found in a survey that almost 80% of the population on the internet has bought something from these E-Commerce stores. However, it involves a complex taxation system. For instance, GST Registration for E-Commerce confuses many. Therefore, In this article, we will understand GST Registration for E-Commerce so that you can also grow your online business easily.
What is E-Commerce?
E-Commerce simply means selling goods and services including digital products on an online platform. For example, Selling physical books or audiobooks online on Amazon and Flipkart.
E-Commerce operates via E-Commerce Operators through digital platforms. This may generally include websites or apps.
Understand About E-Commerce Operators
E-Commerce Operators are simply the platforms that allow sellers and buyers to connect. In other words, The organizations that operate or own mobile apps or websites for an online business are E-Commerce operators.
For instance, Amazon, Flipkart, SnapDeal, Uber, Zomato, etc. are E-Commerce Operators.
These E-Commerce Operators also generate massive revenue and thus need to abide by special provisions and regulations set by the Government.
Thus, Almost every E-Commerce platform also mandates sellers to have GST Registration for E-Commerce.
What is GST Registration?
GST(Goods and Services Tax) is an indirect tax that the sellers have to collect on the behalf of the government. To do so, sellers have to get GST Registration and GSTIN Number.
It was implemented to cascade the effects of other indirect taxes.
Thus, GST has replaced several indirect taxes such as excise duty, VAT, services tax, etc.
Moreover, it is completely online. Hence, it boosts the speed of the whole process from registration to return filing.
GST Registration for E-Commerce
As we know, GST Registration is mandatory for every seller having a turnover of Rs. 20 Lakhs. However, this isn’t the case for sellers on E-Commerce Platforms.
As per the government rules, It is a mandatory prerequisite for sellers on any E-Commerce Platform to have GST Registration regardless of the threshold limit.
It simply means, to sell your goods and services on E-Commerce stores, you must have a GST Registration. Otherwise, you won’t be able to enter an online marketplace.
Similarly, providing services on E-Commerce platforms necessitates the E-Commerce operator to collect GST on the seller’s behalf.
Hence, GST Registration is an important aspect of an online business.
Important Note: E-Commerce Operators also need to have GST Registration and file GST Returns.
GST Return Filing for E-Commerce Operators after getting GST Registration
E-Commerce Operators, as well as E-Commerce Sellers, have to file GST Returns. However, the forms to file returns are different for both.
E-Commerce Operators have to file GSTR-8. It is a mandatory return to be filed by all the online operators who deduct TCS(Tax Collected at Source).
GSTR8 is crucial as it outlines the sales made through the e-commerce platform, as well as the TCS, collected on those goods. Furthermore, it allows suppliers to collect input credit on Tax Collected at Source.
The GSTR8 needs to be filed on the 10th of every month.
Important Note: A penalty of Rs 100 under CGST(Central Goods and Service Tax) and Rs 100 under SGST(State Goods and Service Tax) would be imposed every day if the GSTR8 is not filed on time. Furthermore, Along with late fees, interest at 18% per annum has to be paid as a penalty.
What needs to be mentioned in GSTR-8 after getting GST Registration for E-Commerce?
There are a total of nine sections under GSTR-8. These are as follows.
GSTIN is the first requirement before filing GSTR-8. However, E-Commerce Operators also use provisional id.
The legal name of the Taxpayer
Secondly, business entities are also required to provide their legal name. It generally gets automatically filed through the GST Portal at the time of logging in.
Details of the goods sold made an E-Commerce Platform
In this section, E-Commerce operators need to provide details of the total value of goods sold on the platform. In addition, they also need to provide details of the goods returned by buyers. Hence, the total payable TCS is equal to the difference between goods sold and goods returned.
Corrections in the previous month’s return
To correct the data in the previous month’s return, you have to utilize this section.
Information about Interest to be paid
This section is to mention the details of the missed penalties and interest to be paid on the same.
Taxable Amount and Previously Paid tax
Then, we have the tax section. It includes three parts – CGST, SGST, and IGST. Here, the taxpayers have to fill the amount of tax payable and tax previously paid.
Refunds Issued from Electronic Cash Ledger
If the taxpayers have cleared the complete TCS Liability, then they can get an input tax credit. If already done, it has to be mentioned in this section.
Debit Entries in Cash Ledger
Lastly, On the filing of GSTR-8, the amount of tax received at source will go to Part C of the taxpayer’s GSTR-2A.
Can we revise GSTR-8 after getting GST Registration?
GSTR-8 needs to be furnished with utmost care. The reason is it can’t be revised until next month. In other words, you can rectify the mistakes only in the next month’s GSTR-8 Return. Hence, it’s best to file GSTR-8 through professionals.
GST Return for E-Commerce Sellers after GST Registration
There are basically four types of GST Returns for E-Commerce Sellers. These are as follows.
It is a monthly return to be filed by E-Commerce sellers to highlight the sales or outward supplies. The due date to file GSTR-1 is the 10th of every month.
This return highlights the inward supplies of goods or services. Furthermore, Filing GSTR-2 allows the E-Commerce operators to avail the input tax credit. The due date to file GSTR-2 is the 15th of every month.
It is the consolidated form of the above two returns. It highlights the details of tax paid and collected by an E-Commerce Seller having GST Registration. The due date to file GSTR-3 is the 20th of every month.
This mandatory return is to be filed by every registered business entity under GST. It is a yearly return which both the seller and operator on E-Commerce have to file.
In conclusion, GST Registration and GST Return filing for E-Commerce is an important part to make a viable business.
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