Industry
Accounting for online sellers starts with one question
Why does the money in my bank not match my sales? Because the marketplace deducts commissions, fees, returns and taxes before paying you. Book only the bank credit and your sales, costs and tax credits will all be wrong.
From order value to bank credit
An invented example, to show the shape of a settlement. Your platform's report will have its own lines, and amounts differ.
| Orders shipped, including GST | ₹1,00,000 |
|---|---|
| Less: returns and refunds | − ₹8,000 |
| Less: platform commission and shipping fees | − ₹15,000 |
| Less: GST on those fees | − ₹2,700 |
| Less: GST TCS and income tax TDS by the platform | − ₹550 |
| Less: ads and penalties | − ₹3,000 |
| Bank credit | ₹70,750 |
What each line means for your books
- Sales
- Your return reports what you sold, not what you received.
- Commission and fees
- These are expenses, and the platform's fee invoices may support input tax credit.
- GST TCS
- Since 10 July 2024 the platform collects 0.5% of net taxable sales (0.25% CGST and 0.25% SGST, under Notification 15/2024-Central Tax). It appears in your GST records as a credit once the platform reports it.
- TDS
- Income tax deducted by the platform at 0.1% of gross sales, which you can set against your own tax. Under the Income-tax Act, 2025 this is section 393(1), table entry 8(v); before April 2026 it was section 194-O.
- Returns
- Need matching credit notes, and the goods must return to your stock counts.
A monthly reconciliation that works
Download
Order, return, settlement and fee invoice reports from each platform.
Tie sales
Match orders with your invoices, by state where your GST return requires it.
Tie payouts
Match each settlement to the bank credit, and explain each deduction.
Check returns
Note those in transit, those received, and those lost or damaged. Claim where you can.
Tie taxes
Match TCS with your GST records and TDS with your income tax statement.
Count stock
Include what sits in a platform's warehouse, not just your own.
GST questions to ask before you scale
- Do I have to register now? Section 24 makes registration compulsory for anyone selling through a platform that collects tax, whatever the turnover. Since 1 October 2023, a seller of goods whose turnover stays within the section 22 limit can instead sell within one State using an enrolment number from the GST portal, with no sales to other States (Notification 34/2023-Central Tax). Check the conditions before listing.
- What about other states? Customers elsewhere change how tax is reported. A platform warehouse in another state may require registration there.
- Can I use the Composition Scheme? Since 1 October 2023, a composition taxpayer may sell goods through a platform, but still not services. Other conditions apply, so check before opting in.
Common mistakes
- Booking only net payouts, which hides sales and costs.
- Ignoring returns in transit at month end.
- Not collecting fee invoices, which leaves credit unclaimed.
- Running one open balance for each platform, instead of tracking each settlement period, so unexplained differences pile up.
- Pricing without true per-unit margin, after fees, returns and ads.
The number that decides survival
Work out your margin per unit after commission, shipping, returns, ads and GST. Many sellers grow sales while losing money. Ask Deepak Mittal for a monthly margin by platform, and by your main products if you can.
Questions to ask Deepak Mittal before work starts
- Which marketplaces have you reconciled, and can you show a redacted sample?
- How do you treat returns, and stock in a platform's warehouse?
- How will you track TCS and TDS credit?
- Do you use a tool for settlements, or do it by hand?
Sources checked, November 2026
- GST Council flyer on TCS (opens in a new tab) (official, older), GSTGyaan on section 52 (opens in a new tab) (secondary)
- Notification 15/2024-Central Tax (opens in a new tab) on the TCS rate; CGST Act section 10(2)(d) as amended by the Finance Act, 2023 (ICAI consolidation); Income-tax Act, 2025, Gazette copy (opens in a new tab), section 393(1) (read at source, 10 November 2026)
Marketplace payouts that do not match your sales?
Tell us which platforms you sell on, your monthly orders, and whether your settlements have ever been reconciled.
