The Ultimate GST Compliance Checklist for Indian eCommerce

A step-by-step guide to ensuring your online business remains compliant with the latest GST regulations in India.

India's eCommerce sector has exploded in scale, and so has the complexity of GST compliance for online sellers, marketplaces, and D2C brands. A single compliance lapse — a missed TCS deduction, a wrongly classified HSN code, or a late GSTR-1 filing — can trigger notices, penalties, and blocked input tax credits. This checklist is designed to help eCommerce businesses stay fully compliant year-round. **1. GST Registration: Are You in the Right Category?** Every eCommerce seller supplying goods or services through an online marketplace is required to register for GST, regardless of turnover threshold. Confirm: - You have GST registration in every state where your warehouse or fulfillment centre is located. - Your GSTIN is correctly linked to the marketplace portal (Amazon, Flipkart, Meesho, etc.). - If you operate your own website, check whether you meet voluntary registration thresholds or mandatory thresholds based on aggregate turnover. **2. HSN and SAC Code Accuracy** Every product must carry the correct 4-digit or 8-digit Harmonized System of Nomenclature (HSN) code, which determines the applicable GST rate. Common errors include misclassifying apparel (5% vs 12%), electronics accessories, or food supplements. A wrong HSN code can lead to excess tax collection, penalties, or ITC reversal by your buyers. **3. Tax Collection at Source (TCS) for Marketplace Sellers** If you sell through a marketplace operator, the operator deducts TCS at 1% (0.5% CGST + 0.5% SGST) on the net value of taxable supplies. As a seller: - Verify that TCS credit reflects in your electronic cash ledger on the GST portal. - Reconcile TCS amounts quarterly against your Form GSTR-8 (filed by the operator). - Claim TCS credit while filing GSTR-3B to reduce your net tax liability. **4. GSTR-1 Filing: Invoice-Level Accuracy** GSTR-1 requires invoice-level disclosure of all outward supplies. For eCommerce sellers, this means: - All B2B sales must be reported with buyer GSTIN. - B2C sales above ₹2.5 lakh interstate must be reported individually. - Ensure your marketplace's settlement reports match your GSTR-1 data before filing. - Deadline: 11th of the following month (monthly filers) or last day of the month after the quarter (quarterly filers under QRMP scheme). **5. GSTR-3B: Summary Return and Tax Payment** GSTR-3B is the monthly summary return where you declare your output tax liability and claim input tax credit (ITC). Key checks: - Reconcile ITC claimed against GSTR-2B (auto-populated from your suppliers' filings). - Do not claim ITC on blocked credits (e.g., personal use items, club memberships). - Pay the net tax liability before the filing deadline to avoid interest at 18% per annum. **6. Place of Supply Rules** For eCommerce, the place of supply determines whether IGST or CGST/SGST applies. Common pitfalls: - For goods, the place of supply is the delivery address — not your warehouse location. - For digital services (subscriptions, software), different rules apply based on the recipient's location. - Misapplying IGST vs CGST/SGST can create ITC mismatches and reconciliation issues. **7. Annual Return: GSTR-9 and GSTR-9C** Businesses with turnover above ₹2 crore must file GSTR-9 (annual return) and, if above ₹5 crore, GSTR-9C (reconciliation statement certified by a CA). Start preparing early — reconcile your books, check for any ITC reversals, and ensure monthly returns are consistent with annual accounts. **8. E-Invoicing Compliance** If your aggregate turnover exceeds ₹5 crore, e-invoicing is mandatory. Every B2B invoice must be generated through the IRP (Invoice Registration Portal) and carry an IRN (Invoice Reference Number). Ensure your billing software is IRP-integrated and that e-invoices are generated in real time before dispatch. **9. Reverse Charge Mechanism (RCM)** If your business purchases from unregistered vendors or uses specific services (like legal services, GTA, import of services), GST may be payable under RCM — meaning you pay the tax directly to the government, not the vendor. Maintain a list of RCM-applicable expenses and book them correctly each month. **10. Regular Reconciliation** Monthly reconciliation is the backbone of GST compliance: - Match GSTR-2B with purchase register line by line. - Reconcile marketplace settlement statements with your GSTR-1 data. - Track and resolve mismatches promptly — pending mismatches can result in ITC denial during scrutiny. **Stay Compliant, Stay Confident** GST compliance for eCommerce is multi-layered and time-sensitive. A single missed deadline or incorrect filing can cascade into a chain of notices and financial exposure. NexSphere Global Advisors LLP offers dedicated GST compliance support for eCommerce businesses — from registration to annual returns. Contact our team for a free compliance health check.