GST for Amazon Sellers: Everything You Need to Know in 2026

GST compliance is one of the most critical aspects of running an Amazon seller business in India. From mandatory registration to TCS deductions, GSTR filing, and input tax credit claims, the tax landscape for e-commerce sellers is complex and constantly evolving. Non-compliance can result in penalties, account suspension, and even legal action. This comprehensive guide covers everything Amazon sellers need to know about GST in 2026, including recent changes, filing obligations, and practical tips to stay compliant while maximizing your tax efficiency.

GST Registration Requirements

Unlike traditional businesses that have a threshold exemption, e-commerce sellers are required to register for GST regardless of their annual turnover. This means even if you sell one product per month on Amazon, you need a valid GSTIN. Registration must be done in every state from which you supply goods. If you store inventory in Amazon FBA warehouses across multiple states, you need a GSTIN for each state where your inventory is stored.

The registration process is done through the GST portal (gst.gov.in) and typically takes 3-7 working days. You will need your PAN card, Aadhaar, business address proof, and bank account details. Once registered, your GSTIN must be updated in your Amazon Seller Central account before you can start selling.

TCS (Tax Collected at Source) Provisions

Amazon, as an e-commerce operator, is required to collect TCS at 1% on the net value of taxable supplies. This is split as 0.5% CGST + 0.5% SGST for intra-state supplies, or 1% IGST for inter-state supplies. The TCS is deducted from your settlement payments and deposited with the government by Amazon. As a seller, you can claim this TCS as a credit in your monthly GST returns. While TCS does not increase your total tax burden, it does affect your working capital since the money is withheld upfront.

GSTR-1 and GSTR-3B Filing

Amazon sellers must file GSTR-1 (outward supply return) by the 11th of every month, detailing all invoices issued during the previous month. GSTR-3B (summary return with tax payment) must be filed by the 20th of every month. Getting these filings right requires accurate data on every sale, return, and credit note. One of the biggest challenges is reconciling your GSTR-1 data with Amazon's transaction reports, especially when there are returns, cancellations, and adjustments that span multiple filing periods.

eVanik's GSTR-1 Reporting feature automatically generates filing-ready GSTR-1 data from your Amazon sales, correctly handling B2B and B2C invoices, credit notes for returns, and state-wise breakdowns. This eliminates the manual data preparation that consumes hours every month.

Input Tax Credit (ITC) Claims

As a registered seller, you can claim input tax credit on GST paid on your business purchases — raw materials, packaging, office supplies, software subscriptions, and professional services. To claim ITC, the supplier must have filed their GSTR-1 with your invoice details, and the purchase must be for business use. Maintaining proper records and reconciling your ITC claims against supplier filings is essential. The Tax Mismatch tool helps identify discrepancies between your claimed ITC and supplier filings, preventing issues during GST audits.

Common GST Compliance Mistakes

The most common GST mistakes Amazon sellers make include: not registering in all states where FBA inventory is stored, applying incorrect GST rates to products, not issuing credit notes for returns (leading to excess tax liability), failing to reconcile TCS credits, and missing filing deadlines which attract late fees and interest. Another frequent error is mismatching invoice numbers between Amazon's system and your GST filings, which causes reconciliation issues during audits. Staying on top of these details requires either dedicated accounting resources or automated tools that handle the complexity for you.