What amount of TCS (Tax Collection at Source) should be collected/deducted and in what events?

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Answer
Himanshu Singh Rathor
Himanshu Singh Rathor
  • Answer written
  • 1 Year ago

As per the Section 43C(1) of the MGL, the e-commerce operator is required to collect (i.e. deduct) an amount out of the consideration paid or payable to the actual supplier of goods or services in respect of supplies of goods and/or services made through such operator. The amount so deducted/collected is called as Tax Collection at Source (TCS). The E-commerce aggregators are also made responsible for deducting and depositing tax at the rate of 1% from each of the transaction. Any dealers/traders selling goods/services online would get the payment after deduction of 2% tax (TCS) on the amount of transaction.
 For example - Dealer named X sells grocery products on Flipkart. After receiving the order of Rs. 20,000 (inclusive of tax + commission of Rs.400 charged by Flipkart). Then, Flipkart would need to deduct 2% tax as TCS on the amount (Rs.20,000), including the money paid as the commission of Rs. 400 and GST (Rs. 3600 @18%). Flipkart would thus be deducting tax for Rs 400 (2% of Rs. 20000)


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