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GST Registration for Ecommerce Collecting TCS under GST

Updated on:  

08 min read

GST registration rules and forms for e-commerce operators, online sellers, e-retailers and dealers vary from the normal or regular registration, where the Tax Collection at Source (TCS) provisions apply to the e-commerce operator. The article dives into finer details of the same.

Latest updates on GST Registration

29th August 2021
Taxpayers can get extended time up to 30th September 2021 to revoke cancelled GST registration if the last date for the same falls between 1st March 2020 and 31st August 2021. It applies if the GST registration is cancelled under Section 29(2) clause (b) or (c) of the CGST Act via CGST notification number 34/2021 dated 29th August 2021.

28th May 2021
Due date to file application for revocation of cancellation of registration falling between 15th April 2021 up to 29th June 2021 is 30th June 2021.

1st May 2021
The time limit to take actions, reply or pass orders as given under Rule 9 of the CGST Rules, 2017 that falls between 1st May 2021 and 31st May 2021 has been extended up to 15th June 2021.

5th March 2021
The Search ARN Functionality for Registration, post-TRN Login has been enhanced for the taxpayers.

31st January 2021
1. Persons applying for Registration in Form GST REG-01 as SEZ unit and SEZ developer would now be required to provide the validity period, as per Letter of Approval (LOA)/Letter of Permission (LOP).
2. A functionality has been provided to registrants to upload the copy of Notification issued by MEA /State while applying for Registration on GST Portal in Form GST REG-13.
3. Aadhaar Authentication for one Promoter and Primary authorized signatory has been implemented on the portal for existing taxpayers.

31st December 2020
1. For Taxpayers applying for new registration and opting for Aadhaar Authentication, the authentication would now be required to be done only for one Primary Authorized Signatory and one Promoter/Partner, instead of all.
2. A person registered as a GST Practitioner can now file an application for cancellation of their Registration, in Form GST PCT-06
3. While applying for a new Registration application, the taxpayers will now be shown some additional details related to the same PAN, in a table.
4. Immediately after initiation of GSTIN cancellation, the status of GSTIN for which cancellation is initiated will be shown as “Suspended” on the GST Portal.
5. Taxpayers can select the jurisdiction of CBIC and states/UTs on the basis of PIN code

Who will collect TCS under GST?

e-Commerce aggregators are responsible under the GST law for collecting and depositing tax at the rate of 1% on each transaction under the Section 52 of the CGST Act. Any dealers/traders selling goods/services online would get the payment after deduction of 1% tax. All the traders/dealers selling goods/services online would need to get registered under GST even if their turnover is less than the prescribed threshold limit, for claiming the tax collected by the aggregators. 

Notes: 

1. Supplier of services, who is not supplying through an e-commerce operator liable to collect tax at source, having a turnover of less than Rs.20 lakh are exempted from obtaining registration under GST.

2. e-Commerce operators liable under Section 52 of the CGST Act cannot opt into the composition scheme.

GST registration rules for those liable to TCS

As per Section 24 of the CGST Act, all the e-commerce companies must obtain GST registration mandatorily. 

Any person who is required to collect TCS must electronically submit an application for registration, duly signed or verified through Electronic Verification Code (EVC), using the form GST REG-07 either directly on the GST portal or from a facilitation centre notified by the Commissioner.

As per the CGST Rule 12(1A), the e-commerce operator not having physical presence in the State or Union Territory where the operations are conducted should mention such State name in part-A of the REG-07 form. Further, the State in which the principal place of business is situated must be mentioned in part-B, if it is different from the State mentioned in part-A.

The proper officer will grant registration after verification and issue a certificate of registration in form GST REG-06 within 3 working days from the date of submission of application. The entire process has been illustrated in the flowchart given below.

How-to-Register-Person-who-need-to-deduct-TDs

Cancellation of GST registration for e-commerce operators

If the proper officer enquires or ascertains through a proceeding that a person is no longer liable to collect TCS, then the officer will cancel the registration. The cancellation shall be communicated to the said person electronically in form GST REG-08. The procedure given under the CGST Rule 22 shall be followed for cancellation.

The officer will follow the same procedure for cancellation as for normal taxpayers.

GST registration for people supplying online information from outside India

What does online information and database access or retrieval services mean? Online information and database access or retrieval services [OIDAR] means services whose delivery is mediated through the internet. The supply is essentially automated involving minimal human intervention and impossible without information technology. 

Applicability

These are a few examples of electronic services from the service tax list which will be considered as OIDAR-

  • Advertising on internet
  • Providing cloud services (Google Drive)
  • Provision of e-books, movie, music, software and other intangibles via internet (Hotstar, Amazon Prime Video)
  • Providing data or information, retrievable or otherwise, to any person, in electronic form through a computer network
  • Online gaming (Steam)
  • Web-based services providing trade statistics, legal and financial data, matrimonial services, social networking sites etc

Non-OIDAR services

  • Supplies of goods, where the order and processing is done electronically
  • Supplies of physical books, newsletters, newspapers or journals
  • Services of lawyers and financial consultants who advise clients through email
  • Booking services or tickets to entertainment events, hotel accommodation or car hire
  • Educational or professional courses, where the content is delivered by a teacher over the internet
  • Offline physical repair services of computer equipment
  • Repair of software, or of hardware, through the internet, from a remote location
  • Advertising services in newspapers, on posters and on television
  • Internet backbone services and internet access services (BSNL broadband)

It has also been clarified that using the internet just to communicate or facilitate the outcome of service needs does not always mean that a business is providing OIDAR services.

GST registration process for OIDAR service providers

For further information, read the related articles, listed below:

Step-by-step guide for GST registration

Impact of GST on e-commerce operators

GST compliance prescribed for e-commerce operators

All you need to know about tax collected at source under GST

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