What does Amazon actually do for your GST?
Amazon is an e-commerce operator under Section 52 of the CGST Act. That gives it a few fixed GST jobs, and only these:
- Collects TCS. Amazon keeps back 0.5% of the net taxable value of your sales (0.25% CGST + 0.25% SGST, or 0.5% IGST) from your payouts. The rate was cut from 1% to 0.5% from 10 July 2024.
- Files GSTR-8. By the 10th of the next month, Amazon deposits that TCS and reports your sales against your GSTIN in GSTR-8.
- Charges GST on its fees. Referral, closing, shipping, FBA and ad fees carry GST, and Amazon gives you tax invoices for them.
- Gives you reports. Seller Central has tax reports (B2B and B2C) that list each order with its tax. It can also generate customer invoices in your name.
Amazon also deducts 0.1% income-tax TDS on your sales under section 393(1) of the Income-tax Act, 2025 (earlier section 194-O). That is income tax, not GST, and you claim it in your income-tax return.
What is still your job as the seller?
Almost everything that decides whether your GST is right stays with you:
- Holding a GSTIN in every state where you have a place of business, including states where your FBA stock sits.
- Choosing the right HSN code and GST rate for each product.
- Reporting every sale, return and credit note in GSTR-1 (11th of the next month, or quarterly if you are in QRMP).
- Filing GSTR-3B (20th, or 22nd/24th for QRMP) and paying the tax left after input tax credit and TCS.
- Accepting Amazon's TCS on the GST portal so it actually reaches your cash ledger.
- Claiming input tax credit on Amazon's fee invoices and your purchases.
- Matching Amazon's reports with your returns every month.
Our guide on how often Amazon sellers file GST returns covers the filing calendar in detail.
Amazon or seller: who does what?
| GST task | Amazon | You |
|---|---|---|
| GST registration | Checks your GSTIN before listing taxable goods | Apply, keep it active, add states |
| GST rate and HSN on each product | Applies the tax code you set | Pick the correct code |
| Customer invoice | Can generate it in your name | Responsible for what it says |
| TCS at 0.5% | Collects and deposits it | Accepts it on the portal and uses it |
| GSTR-8 | Files it by the 10th | Checks it against your sales |
| GSTR-1 and GSTR-3B | No | Files every period, even with no sales |
| Paying the balance tax | No | Pays through GSTR-3B |
| ITC on Amazon fees | Issues fee invoices with GST | Claims the credit |
Does the TCS Amazon collects pay your GST?
No. TCS is an advance, not your tax payment. Say you sell ₹1,00,000 of goods at 18% in a month. Your output GST is ₹18,000. Amazon collects about ₹500 as TCS. You still owe the rest, less any input tax credit.
The TCS also does not reach you on its own. It shows up on the GST portal under TDS and TCS credit received. You accept the entries and file that form, and only then is the money credited to your electronic cash ledger. From there it can pay your GST, or be claimed as a refund if it piles up. Our guide on claiming GST TCS credit walks through each step.
Who decides the GST rate on your Amazon listing?
You do. Seller Central works out the tax on each order from the Product Tax Code (PTC) you choose for the listing. If you leave it blank, Amazon uses a default code that charges 18%.
The invoice goes out in your name with your GSTIN, so a wrong code means you charged the wrong tax. If you charged too little, the shortfall is still yours to pay. If you charged too much, you have collected tax the customer should not have paid. Check the code against the HSN and rate that actually apply to the product, not the one a competitor uses.
Where do Amazon sellers usually slip?
Most problems we see come from assuming Amazon's reports are the return:
- Wrong HSN or tax code on a few listings, so the tax report carries the wrong rate into GSTR-1.
- Returns not reflected. A customer return needs a credit note in GSTR-1. If you skip it, you pay tax on a sale you no longer have.
- TCS never accepted on the portal, so the cash ledger stays empty and the credit goes unused.
- Fee ITC missed. Amazon's fee invoices carry GST you can claim, if they show your GSTIN and appear in GSTR-2B. See ITC for e-commerce sellers.
- Treating the settlement as sales. The settlement is cash after fees, TCS, TDS and returns. Your turnover comes from the tax report.
What happens if you stop filing but Amazon keeps collecting TCS?
Amazon keeps reporting your sales in GSTR-8, so the department can see turnover against your GSTIN even if you file nothing. Missed returns attract late fees and 18% interest on unpaid tax. After a run of missed returns, the officer can cancel your registration, and Amazon will then stop you from selling taxable goods.
The TCS keeps sitting on the portal, unused. If you do not plan to sell for a while, file nil returns or apply to cancel the GSTIN properly. Do not just go quiet. If you are not yet registered, read whether you can sell on Amazon without GST.
What we'd check in your case
- Whether you need a GSTIN in more states because of FBA warehouses.
- The HSN code and tax code on your top-selling listings.
- Last quarter's GSTR-1 against Amazon's tax report and GSTR-8.
- Whether your TCS has been accepted and how much sits in your cash ledger.
- Whether Amazon's fee GST is being claimed as ITC.
Send us your last two months of Amazon tax reports on WhatsApp and we will tell you plainly what is covered and what is not. If you still need a GSTIN, see our GST registration service.
Not sure how this applies to you? Tell us what you sell and where. We'll tell you what you need, and what you don't, in a free 15-minute fit check.
Ask on WhatsAppRelated questions
Does Amazon pay GST on my behalf?
No. Amazon pays only the TCS it collects from you and the GST on its own fees. Your output GST is paid by you through GSTR-3B.
Is the TCS Amazon deducts my GST payment?
No. It is an advance credit. Once you accept it on the GST portal, it goes to your electronic cash ledger, and you can use it to pay your GST or claim a refund.
Who decides the GST rate on my Amazon listing?
You do, through the Product Tax Code and HSN you set for each product. If you leave it blank, Amazon applies a default 18% code.
Does Amazon file GSTR-1 for sellers?
No. Amazon files GSTR-8 for the TCS it collects. You file GSTR-1 and GSTR-3B for your own GSTIN, using Amazon's tax reports as a starting point.
What happens if I do not file returns but Amazon collects TCS?
Late fees and interest build up, and your GST registration can be cancelled after a run of missed returns. The TCS stays unused on the portal until you file and accept it.
See our service: GST registration for online sellers →
Sources
- CGST Act, 2017, section 52 (CBIC)
- Notification 15/2024-Central Tax: TCS rate cut to 0.25% CGST
- GST portal user guide: TDS and TCS credit received
- Amazon seller FAQs on the invoicing feature (Product Tax Code)
General information based on rules as of November 2026, not legal or tax advice for your specific case. Rules change; we confirm what applies to you before any filing.