In this article · 7 sections
GST rules for online sellers can feel confusing, especially compared with a regular shop. This guide gives a plain-language overview so you know which questions to ask. It is not tax advice. Rules, thresholds and exemptions change, and your situation depends on what you sell and where. Always confirm with a chartered accountant.
Do online sellers need GST registration?
Generally, GST registration depends on your turnover and type of supply, but selling through e-commerce marketplaces has had special rules, and there have been changes and exemptions for small sellers over time. Selling only through your own website may be treated differently from selling via marketplaces.
Ask your CA: - Do I need to register, given my turnover and the platforms I use? - Are there any composition scheme limits on selling online? - Do I need separate registration for other states (for example, if I store stock in warehouses there)?
GST invoices
If you're registered, your invoices generally need: - Your business name, address and GSTIN - Invoice number and date - Customer details (and GSTIN for B2B buyers) - Product description and HSN code - Taxable value, GST rate and tax amount (CGST + SGST for same-state sales, IGST for inter-state) - Place of supply
Most store platforms can generate these with a GST invoice plugin or app. See GST billing software.
Same-state vs other-state sales
- Within your state: CGST + SGST
- To another state: IGST
Your store should calculate tax based on the customer's delivery state. Check this setting carefully when setting up your store.
TCS on marketplaces
When you sell through marketplaces like Amazon or Flipkart, the marketplace collects Tax Collected at Source (TCS) on your sales and deposits it with the government. You can usually claim this as credit when filing returns. Selling only through your own website generally doesn't involve marketplace TCS.
Shipping, discounts and returns
- Shipping charged to the customer may need to be included in the taxable value
- Discounts shown on the invoice generally reduce taxable value
- Returns need credit notes and proper adjustments
Ask your CA how to treat each in your store's settings.
Records to keep
- Sales invoices and credit notes
- Purchase invoices (for input tax credit)
- Payment gateway settlement reports
- Courier invoices
- Marketplace settlement and TCS reports
- Stock records
A monthly routine of exporting reports from your store, payment gateway and courier saves a lot of stress at filing time.
Practical setup tips for your store
- Add the correct HSN code and GST rate to every product
- Decide whether displayed prices include GST (common for B2C in India) and set the store accordingly
- Show GSTIN in the website footer and on invoices
- Allow B2B buyers to enter their GSTIN at checkout
- Test an order from your state and another state to check tax calculation
When we build online stores, we set up GST-ready invoices and tax settings based on your CA's guidance. Talk to us.