What is TCS on Amazon sales and how do I claim it?

The short answer

TCS (Tax Collected at Source) is the tax Amazon deducts from your taxable sales before paying you, under Section 52 of the CGST Act, 2017. It is not an extra cost: you claim it by accepting it under “TDS and TCS Credit Received” on the GST portal, which credits your electronic cash ledger, and then using it in GSTR-3B. The rate is 0.5% of the net taxable value since 10 July 2024 (Notification No. 15/2024-Central Tax); the 1% figure in older guides is the statutory ceiling in Section 52(1), not the rate in force.

What TCS is — and why Amazon collects it

When you sell through Amazon, Flipkart or Meesho, the marketplace is an “electronic commerce operator” (ECO). Under Section 52 of the CGST Act, an ECO that collects the consideration for supplies made through its platform must collect TCS on the net value of taxable supplies made through it.

In plain terms: for every taxable sale that is paid through the platform, Amazon holds back a small part of the sale value as TCS and deposits it with the government on your behalf. The deduction happens before the settlement reaches your bank account, which is why your payout is always less than your gross sales — and why sellers who never reconcile their settlements keep wondering where the money went.

TCS is not a fee, and it is not Amazon’s money. It is your tax, paid in advance, and it comes back to you as a credit.

Where your TCS credit shows up

The chain has three links, and a break in any one of them is how credit gets lost:

1. Amazon files GSTR-8. The operator reports the TCS it collected, GSTIN-wise, in Form GSTR-8, due by the 10th of the following month. This is the document that tells the government the money is yours.
2. The credit appears under “TDS and TCS Credit Received” on the GST portal. Go to Services > Returns > TDS and TCS Credit Received. The portal auto-drafts the TCS entries from Amazon’s GSTR-8 under Table 4 (TCS Credit); you must Accept the rows. TCS never enters the ITC pool — it is not part of GSTR-2B, which is the input-tax-credit statement. This is the figure your return should be matched against — not a number remembered from a statement.
3. The credit lands in your electronic cash ledger. Once accepted, the TCS amount credits your electronic cash ledger and is available to pay your output tax liability in GSTR-3B, or claim back under the refund provisions if it remains unutilised.

If any link is missing — Amazon has not filed GSTR-8 for the month, the GSTIN on your seller account is wrong, or you never accepted the credit under “TDS and TCS Credit Received” — the credit sits unclaimed. It does not expire quietly into your pocket; it simply never reaches your return.

How to claim your TCS credit, step by step

Step 1 — Note the TCS on your Amazon statement. Open the payment or settlement statement for the month and find the TCS deducted. Work from the actual amount deducted, not from a rate you read in a blog post.

Step 2 — Open “TDS and TCS Credit Received” for the same month. On the GST portal, go to Services > Returns > TDS and TCS Credit Received. Check the TCS Credit table (Table 4) and note the amount reported against your GSTIN — then Accept the rows.

Step 3 — Compare the two figures. They should agree for the month. A small difference usually means a timing gap: a sale made at the end of the month may be reported by Amazon in the following month’s GSTR-8.

Step 4 — Report it in GSTR-3B. The TCS credit available in your electronic cash ledger can be used to discharge your output tax liability for the month. Claim only what the accepted TCS credit shows — claiming more than what is reported is what triggers mismatches and notices.

Step 5 — Chase what is missing. If the accepted TCS credit is less than your statement, check whether the month’s GSTR-8 has been filed, whether the sale was returned or cancelled after the TCS was deducted, and whether the GSTIN on your Amazon account is correct. Follow up with Amazon’s seller support for the filing status if the gap persists.

Step 6 — Deal with unutilised credit. If TCS credit remains unused after setting it off against your liability, it can be claimed as a refund under the GST law. Do not let it accumulate month after month without a decision.

Why the credit often does not match

• Returns and cancellations. TCS is deducted when the sale is made. If the order is later returned, the TCS treatment has to follow the return — and the two months rarely line up neatly.
• Month cut-offs. Sales in the last days of a month are often reported in the next month’s GSTR-8. A one-month lag is normal; a three-month lag is a problem.
• Wrong GSTIN. If the GSTIN on your Amazon account does not match the GSTIN on your return, the credit is reported against the wrong registration.
• GSTR-8 not filed. If the operator has not filed for the month, there is no TCS credit to accept under “TDS and TCS Credit Received”.

The rate question — read this before you quote a number

The rate is 0.5% of the net taxable value — 0.25% CGST + 0.25% SGST on intra-state supplies, 0.5% IGST on inter-state supplies — in force since 10 July 2024 under Notification No. 15/2024-Central Tax, after the 53rd GST Council (22 June 2024). The 1% figure in older guides was the rate under Notification 52/2018, in force till 9 July 2024; Section 52(1)’s “not exceeding one per cent” is only the statutory ceiling. Your Amazon statement shows the amount actually deducted — reconcile to that amount.

Make TCS a monthly habit, not a year-end surprise

TCS is small on any single order and large across a year of selling. The sellers who lose money to it are not the ones with the biggest sales — they are the ones who never matched a single month. Add the TCS check to your monthly routine: statement, TDS and TCS Credit Received, GSTR-3B, done.