GST and TCS Reconciliation for Amazon and Flipkart Sellers: A Monthly Checklist

Selling on Amazon and Flipkart is simple on the front end. The tax side is not. Every month you have sales reports by GST registration, tax collected by the marketplace on your behalf, income tax deducted at source, fee invoices to claim input credit on, and often stock moving between warehouses in different states.

None of it is hard on its own, but it piles up quickly, and mismatches between your returns and the marketplace's filings come back as notices. This checklist covers what to reconcile each month. It is a practical guide, not tax advice: confirm the treatment for your business with your chartered accountant.

The five things to reconcile

1. Sales: match the marketplace report to your GSTR-1

On Amazon, download the Merchant Tax Reports (B2C and B2B) from the Tax Document Library each month. They list every invoice, refund and cancellation with the seller GSTIN, ship-from and ship-to state, HSN code, taxable value and tax.

• Split by GSTIN. If Amazon stores your stock in several states, each registration files its own GSTR-1 for the sales shipped from that state.
• Include refunds and cancellations. The report for a month often includes refunds of invoices from earlier months. Report them as credit notes in the month they appear.
• Check tax rates and HSN codes. After the September 2025 GST rate changes, confirm that the rate on each product in the report matches the rate that applies to your HSN code.
• Report marketplace sales separately. Since the January 2024 tax period, GSTR-1 has a table (Table 14) for supplies made through e-commerce operators, with the operator's GSTIN. Your figures there should match what the marketplace reports for you.

2. GST TCS: claim what the marketplace collected

Marketplaces must collect TCS at 0.5% of the net value of taxable supplies made through them (0.25% CGST + 0.25% SGST for sales within a state, or 0.5% IGST between states). This rate has applied since 10 July 2024; it was 1% before.

1. The marketplace files GSTR-8 by the 10th of the following month.
2. The details appear in GSTR-2A (Part C) for each of your registrations.
3. Check the net taxable value against your own sales for that GSTIN, then accept the TCS credit on the GST portal so it reaches your electronic cash ledger.
4. Use the cash ledger balance to pay GST, or claim a refund of any excess.

3. Income tax TDS: check it lands against your PAN

Marketplaces also deduct income tax TDS at 0.1% of your gross sales. From 1 April 2026 this falls under section 393(1) of the Income-tax Act, 2025 (it was section 194-O under the old Act). For individual and HUF sellers who provide PAN or Aadhaar, it doesn't apply if sales through the marketplace stay within ₹5 lakh in a year.

• Match the TDS shown in the marketplace's settlement or transaction report with Form 26AS / AIS each quarter.
• Chase any missing quarter with the marketplace early; it is much harder at return-filing time.
• Claim the TDS as a credit in your income tax return.

4. Fee invoices: claim input credit

Amazon and Flipkart issue monthly tax invoices for their fees (commission, closing, fulfilment, shipping, storage, advertising) with 18% GST, and credit notes for fee refunds. That GST is usually claimable as input tax credit.

• Download all invoices and credit notes for the month, for every GSTIN. Fees are often billed to the registration of the state where the stock or sale sits.
• Match them to GSTR-2B before claiming credit.
• Net off credit notes, and check that advertising invoices (often billed separately) are included.
• Keep the PDFs filed by month and GSTIN; your auditor will ask for them.

5. Stock transfers between states

When Amazon moves your stock from a fulfilment centre in one state to another, it is a supply between two of your own GST registrations. Amazon's stock transfer report lists these movements with invoice numbers, values and the sending and receiving GSTINs.

• The sending registration reports it as an inter-state supply and pays IGST.
• The receiving registration claims that IGST as input credit.
• Movements between two warehouses in the same state, under the same GSTIN, are not supplies; keep them for your stock records only.

Your monthly checklist

1. Download the Merchant Tax Reports (B2C, B2B) and the stock transfer report for the month.
2. Download every fee invoice and credit note, for every GSTIN.
3. Prepare GSTR-1 for each GSTIN, including credit notes and the e-commerce operator table.
4. After the 10th, check GSTR-2A Part C and accept the TCS credit.
5. Match fee invoices with GSTR-2B and claim input credit in GSTR-3B.
6. Record inter-state stock transfers on both sides.
7. Every quarter, match marketplace TDS with Form 26AS / AIS.
8. File everything by month and GSTIN for your auditor.

Pexeta's seller dashboard does steps 1 and 2 for our clients: it keeps each month's Amazon tax reports and fee invoices, sorts them by GSTIN, and produces a single download for the auditor.