The term Tax Collected at Source (TCS) is different from the concept of tax deduction at source (TDS). TDS refers to the tax which is deducted when the recipient of goods or services makes some payments under a contract etc. while TCS refers to the tax which is collected by the electronic commerce operator when a supplier supplies some goods or services through its portal and the payment for that supply is collected by the electronic commerce operator.
The e-Commerce Operator as well as the supplier supplying goods or services through an Operator need to compulsorily register under GST even if their turnover is below Rs. 20 lakh.
Similarly, every person who supplies goods/services through an Operator should get registered under GST.
As per Section 52 of the CGST Act, 2017, e-Commerce Operator should collect tax at source in respect of the taxable supplies made through it by other suppliers, where the consideration in respect of such supplies is collected by him.
The amount of tax collected by the Operator is required to be deposited with the Government within the prescribed time in the manner specified in the Act.
The details furnished by the Operator in GSTR-8 shall be made available electronically to each of the suppliers in Part C of FORM GSTR-2A on the Common Portal after the due date of filing of FORM GSTR-8.
The tax collected by the Operator shall be credited to the cash ledger of the supplier who has supplied the goods/services through the Operator. The supplier can claim credit of the tax collected and reflected in the return by the Operator in his [supplier’s] electronic cash ledger.
The details of the supplies, including the value of supplies, submitted by every Operator in the statements will be matched with the details of supplies submitted by all such suppliers in their returns. If there is any discrepancy in the value of supplies, the same would be communicated to both of them. If such discrepancy in value is not rectified within the given time, then such amount would be added to the output tax liability of such suppler. The supplier will have to pay the differential amount of output tax along with interest.
An officer not below the rank of Deputy Commissioner can issue Notice to an Operator, asking him to furnish details relating to volume of the goods/services supplied, stock of goods lying in warehouses/godowns etc.
Read the full text of the Concept Note below.
