The 1% TCS you are owed — and probably never claimed.
Every marketplace deducts 1% TCS on your sales and deposits it against your GSTIN. It sits in your GST cash ledger as a credit that is legally yours. Most sellers never claim it. Here is how the credit works, and how to bring it back.
- TCS (Tax Collected at Source) is ~1% marketplaces must collect on your net taxable sales and deposit against your GSTIN.
- It is not an extra tax you bear — it is your money, parked with the government as a claimable credit.
- The marketplace files it in GSTR-8; it reflects in your GSTR-2A and posts to your electronic cash ledger once accepted.
- It does not claim itself — unreconciled, the credit sits unused, sometimes for years.
- Robnu surfaces the TCS from your settlements so you and your CA can claim it; rules change, so always confirm on the GST portal.
This is one of the most common ways small marketplace sellers leave their own money on the table — not through a wrong deduction, but through a credit they never realised was waiting. This guide is a plain-language walk through what TCS is, where it goes, and how it comes back. It is general information, not tax advice: rules change, and your situation is specific, so confirm everything with the GST portal and a chartered accountant.
There is a pool of your money sitting in a government ledger right now, and if you sell on marketplaces there is a good chance you have never touched it. It is your TCS credit, and understanding it is one of the highest-value hours a marketplace seller can spend on the tax side of the business.
What TCS is, exactly
TCS stands for Tax Collected at Source. Under the GST law, an e-commerce operator — Amazon, Flipkart, AJIO, Meesho — is required to collect a small percentage on the net value of taxable supplies made through its platform and deposit it with the government against the supplier’s GSTIN. In India this is commonly 1% — recorded as CGST plus SGST for intra-state supplies, or IGST for inter-state — on the net taxable value after returns.
The critical point, and the one that changes how you should feel about it: TCS is not a cost. It is not an extra tax the marketplace is charging you. It is your own money, collected on your behalf and held by the government as a credit you can claim against your GST liability. Every rupee of TCS is a rupee you can eventually use — if you go and get it.
Where the credit lives
Follow the chain and the mystery disappears. The marketplace collects the TCS from your settlement, then reports it in its own GST return — Form GSTR-8. That filing flows to the GST portal, where it appears against your GSTIN in Form GSTR-2A under the TCS section. When you accept it, the amount posts to your electronic cash ledger under the TCS head. From there, it can be used to offset your output GST when you file. The credit was never lost — it was just waiting for you to complete the last step.
How to claim it
In outline, claiming the TCS credit is a reconcile-accept-use loop. Reconcile the TCS shown in each marketplace’s statement against what appears in your GSTR-2A on the portal, so you know the marketplace actually deposited what it deducted. Accept the TCS credit so it posts to your electronic cash ledger. Use that ledger balance to pay your GST liability when you file your returns. The exact screens and sequence on the GST portal change over time, so always follow the current process there.
This is precisely where reconciliation on the money side and the tax side meet. The same settlements you check in payout reconciliation carry the TCS figures; the deeper mechanics of matching collected-versus-credited live in our TCS reconciliation guide. And if you file GSTR-1 from your marketplace data, our guide on building GSTR-1 from marketplace reports connects the same reports to the rest of your return.
TCS is not TDS — keep them separate
A common and costly confusion: TCS under GST is not the same as the income-tax TDS that some operators deduct under section 194-O. TCS is a GST mechanism claimed through your GST cash ledger. The 194-O TDS is an income-tax deduction reconciled against your Form 26AS and claimed in your income-tax return. They are different taxes, in different systems, claimed in different places. Treating them as one is how sellers under-claim both. For the income-tax side, see our guide on income tax for online sellers.
Why the discipline pays off
At 1% of net taxable sales, TCS accumulates faster than most sellers expect. On a few lakh rupees of monthly marketplace turnover, the annual TCS is a genuinely useful sum — and it is not a windfall or a grey-area saving, it is simply money that is already yours, waiting to be used. The only reason it stays unclaimed is that nobody went and reconciled the statements. Build that into your monthly rhythm alongside payment reconciliation and it stops slipping.
Make claiming the credit a habit, not a hunt
The difference between sellers who recover their TCS and sellers who let it pile up unused is rarely knowledge — once you understand it is a credit, the concept is not hard. The difference is habit. The credit accrues quietly, month after month, and nothing in your day forces you to go and reconcile it; there is no red alert, no overdue notice, just a slowly growing balance in a ledger you rarely open. Left to good intentions, “I will sort the TCS out later” becomes a year of unclaimed credit and a stressful reconciliation at filing time.
The fix is to attach the TCS check to something you already do reliably. If you reconcile your payouts every settlement cycle — and you should, per our payout reconciliation guide — the TCS figures are right there in the same reports. Reading them out at the same time costs almost nothing extra and keeps the credit current rather than letting it drift. The mechanics of that match, collected against credited, are laid out in the TCS reconciliation guide. Do it monthly and the credit is never a surprise; defer it and it becomes the money you meant to claim and never did.
Sources & further reading
The mechanics above reflect the GST framework at the time of writing. TCS rates, forms and portal steps change, and your specific treatment depends on your registration and supplies — so treat this as general information and confirm with the official portals and your chartered accountant before filing:
How your 1% becomes a usable credit
The TCS credit is not lost anywhere in this chain — it just needs you to complete the last step.
- 1Marketplace collects. 1% of net taxable value is deducted on your settlement.
- 2It files GSTR-8. The operator reports the TCS against your GSTIN.
- 3It reflects in GSTR-2A. You reconcile and accept the TCS on the portal.
- 4You use the credit. The cash-ledger balance offsets your GST liability.
Where sellers lose the credit
None of these are exotic — they are the ordinary ways a legitimate credit goes unclaimed.
Not knowing it exists
Many first-time sellers read TCS as just another marketplace fee and never realise it is a credit they can reclaim.
Never reconciling
The credit only becomes usable once you match the marketplace statement to GSTR-2A and accept it. Skip that and it sits idle.
Confusing TCS and TDS
Treating the GST TCS and the income-tax 194-O TDS as one thing means under-claiming both. They are separate, in separate systems.
Losing the numbers
Across AJIO, Meesho and Amazon the TCS figures scatter across settlements. Without one place to gather them, they are easy to under-count.
How Robnu surfaces your TCS
Robnu is an agentic OMS, not a tax filer — the return still goes through you and your chartered accountant. What Robnu removes is the groundwork that makes the credit easy to miss.
It reads the TCS figures out of your AJIO, Meesho and Amazon settlements, reconciles what was collected against what was deducted, and gathers the numbers into one place so you and your CA can claim the credit correctly and on time. No hunting across dashboards; no under-counting because a settlement got missed. The visibility comes from Robnu; the filing stays yours.
That is the money spine at work on the tax side: you sell, Robnu runs the rest and makes sure every rupee — including the ones the government is holding — is accounted for.
TCS credit, answered
TCS — Tax Collected at Source — is a small percentage that e-commerce operators like Amazon, Flipkart, AJIO and Meesho are required to collect on the net value of taxable supplies made through them, and deposit with the government against your GSTIN. In India this is commonly 1% (split as CGST and SGST for intra-state supplies, or as IGST for inter-state) on the net taxable value. It is not an extra tax you bear — it is your own money, parked with the government as a credit you can claim.
Because it does not claim itself, and it is easy to miss. The marketplace deducts it, the government holds it, and it appears in your GST electronic cash ledger under the TCS head — but only when you actively reconcile the marketplace's TCS statement against your own returns and use the credit does it come back to you. Many small sellers simply do not know it is sitting there, or never complete the reconciliation, so the balance quietly accumulates unused.
The marketplace files its TCS collection in its GSTR-8 return. That flows to your GST portal, where it appears in Form GSTR-2A (the TCS section) and can be accepted so the amount lands in your electronic cash ledger under the TCS head. From there you can use it to offset your output GST liability. The chain is: marketplace collects, marketplace files GSTR-8, it reflects in your 2A, you accept it, it credits your cash ledger.
In outline: reconcile the TCS shown in the marketplace's statement against what appears in your GSTR-2A on the GST portal, accept the TCS credit so it posts to your electronic cash ledger, and then use that ledger balance to pay your GST liability when you file. The exact screens and steps change over time, so follow the current process on the GST portal and confirm with your chartered accountant.
No. TCS is Tax Collected at Source, collected by the e-commerce operator on your sales. TDS under section 194-O is a separate income-tax deduction some operators make on the gross amount. They are different taxes under different laws, appear in different places, and are claimed differently. This guide is about the GST TCS credit; your income-tax TDS is reconciled separately against your Form 26AS.
It depends entirely on your sales volume, but at 1% of net taxable supplies it accumulates faster than sellers expect. On a few lakh rupees of monthly marketplace sales, the annual TCS is a meaningful sum — money that is legally yours and simply waiting in a government ledger. The point is not the rate; it is that unclaimed, it does nothing for you.
Closely. The same marketplace settlement reports that carry your commissions and shipping deductions also record the TCS collected. Reconciling payouts surfaces the TCS figures, and reconciling TCS confirms the marketplace deposited what it deducted. Do them together and the money side and the tax side check each other. See our payout reconciliation and TCS reconciliation guides.
Robnu is an agentic OMS, not a tax filer or a substitute for your CA — but it does the groundwork. It reads the TCS figures from your AJIO, Meesho and Amazon settlements, reconciles collected-versus-deducted, and surfaces the numbers you and your accountant need to claim the credit correctly and on time. The filing stays with you and your CA; the visibility comes from Robnu.
Related seller guides
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GSTIN for marketplace sellers: what it is and why you need one
Your 15-character tax registration, decoded — its structure, why marketplaces require it, and how it connects to the TCS credit most sellers never claim back.
The 1% TCS every marketplace deducts — and how to claim it back
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TCS Reconciliation: From Marketplace Reports to Your GSTR
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GST for Amazon, Flipkart, AJIO & Meesho Sellers (2026): The Fundamentals
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