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Ask any marketplace seller what confuses them most about their monthly settlements, and GST-related deductions come up almost every time. Between TCS, TDS and marketplace commission, the amount that actually lands in your bank account can look nothing like your total sales. Here's what's actually happening in that gap.
Under GST rules, marketplaces are required to collect Tax Collected at Source (TCS) on the net value of taxable supplies sold through their platform, and deposit it against your GSTIN. This isn't an additional cost to you, it's adjustable against your GST liability when you file returns, but it does mean your settlement amount is lower than your gross sale value.
Depending on the nature of your transactions and applicable thresholds, Tax Deducted at Source may also apply, separate from TCS. The two are often confused because both reduce your payout, but they're deducted under different provisions and reconciled differently at filing time.
GST 2.0 restructured slab rates for several categories, apparel included, which directly affects the tax component embedded in your settlement calculations. Sellers who haven't updated their internal pricing and reconciliation sheets to reflect current slabs often find their 'discrepancy' is actually just an outdated tax assumption.
A settlement file nets out TCS, TDS, commission, shipping fees, and any refunds or chargebacks processed in that cycle. Comparing gross order value directly to bank credit will almost always show a mismatch, the fix is reconciling at the line-item level, not the total level.
No, TCS is adjustable against your output GST liability when you file your returns. It reduces your immediate payout but isn't a net additional expense, provided it's reconciled correctly.
The underlying rule is the same across platforms, but the settlement file formats and reporting cycles differ, which is why a lot of sellers reconcile Amazon, Flipkart and Myntra payouts separately rather than trying to compare them directly.
You risk either overpaying GST (by not claiming the TCS credit correctly) or facing mismatches during GST return filing that can trigger notices. Monthly reconciliation is the simplest way to avoid both.
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