registration under GST

See section 9(5)&52

GST: Special Provisions for E-Commerce

Mandatory Registration for E-commerce Operators and their Vendors: Under the GST regime, a specific threshold limit of aggregate turnover is prescribed for registration, i.e., INR 20 lakhs in general and INR 10 lakhs for specified States. However, the threshold limit is not applicable in case of e-commerce operators.

Further, even the sellers who supply goods and/or services through an e-commerce operator are required to get registered under GST, irrespective of the threshold limit. However, there are two exceptions whereby suppliers selling through e-commerce operators may avail threshold exemption:

where e-commerce operators are liable to pay tax on behalf of the suppliers, or

if the supply is made through such e-commerce operator that is required to collect TCS.

GST provides for state-specific registration, and therefore, all e-commerce operators will have to register in each state from where it is making a taxable supply of goods and/or services.

Tax Collection at Source (TCS): The e-commerce operator is required to collect an amount at the rate of one percent (0.5% CGST + 0.5% SGST) of the net value of taxable supplies made through it, where the consideration is collected by such operator. The amount so collected is called as TCS.

TCS is required to be deducted in each state and deposited accordingly. This brings in significant compliance challenges to sellers and may discourage sales through online portals. The key purpose of this particular provision is to encourage compliances under GST and provide a mechanism for the Government to track suppliers who sell through e-commerce operators.

No benefit of composition scheme: Sellers who are supplying goods and/or services through an e-commerce operator are not allowed to opt for composition scheme under the GST regime.