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TAXATION OF E-COMMERCE UNDER GST
According to section 2(44), electronic commerce means supply of goods or services or both including digital products over digital or electronic network.
- Electronic commerce operator
Section 2(45) says that electronic commerce operator means any person who owns, operates or manages digital or electronic facility or platform for electronic commerce.
- Collection of tax at source
Every electronic operator, not being an agent, shall collect an amount calculated at the rate of 1% of the net value of taxable supplies made through it where the consideration with respect to such supplies is to be collected by the operator.
- At what time should e-commerce operator collect TCS?
TCS should be collected once the supply has been made through e-commerce operator.
- What is the time within which such TCS is to be remitted by the e-commerce operator to the Government account?
The amount collected by the operator is to be paid to appropriate Government within 10 days after the end of the month in which the said amount was so collected
- Whether TCS to be collected on exempt supplies?
TCS is not required to be collected on exempt supplies.
- Whether TCS is required to be collected on supplies on which tax is paid under reverse charge?
No, TCS is not required to be collected supplies on which the recipient is required to pay tax on reverse charge basis.
- Whether TCS is required to be collected in respect of supplies made by the composition taxpayer?
A composition dealer cannot make supplies through e-commerce operator. Thus, question of collecting TCS in respect of supplies made by the composition taxpayer does not arise.
- Is it mandatory for e-commerce operator to obtain registration?
Every electronic commerce operator has to obtain compulsory registration irrespective of the value of supply made by him.
- Whether supplier of goods or services supplying through e-commerce operator would be entitled to threshold exemption?
Every person supplying goods through e-commerce operator shall be mandatorily required to register irrespective of the value of supply made by him. However, supplier of services, other than supplier of services under section 9(5) of CGST Act, through an e-commerce platform are exempted from obtaining compulsory registration provided their aggregate turnover does not exceed INR 20 lakhs in a Financial year.
- Is it necessary for e-commerce operators who are already registered under GST and have GSTIN, to have separate registration for TCS?
E-commerce operator has to obtain separate registration for TCS irrespective of the fact whether e-commerce operator is already registered under GST.
- How is TCS to be credited in cash ledger? Whether the refund of such TCS credit lying in the ledger would be allowed at par with the refund provisions?
TCS collected is to be deposited by the e-commerce operator separately under the respective tax head. Based on the statement (FORM GSTR-8) filed by the e-commerce operator, the same would be credited to electronic cash ledger of the actual supplier in the respective tax head. If the supplier is not able to use the amount lying in the said cash ledger, the actual supplier may claim refund of the excess balance lying in his electronic cash ledger.
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