Is GST TDS applicable if each bill is below ₹2,50,000 but the contract value exceeds ₹2,50,000?

Yes. The statutory test under Section 51 is based on the "total value of supply under a contract" exceeding ₹2,50,000 (excluding GST). Even if individual invoices are for smaller sums (e.g., ₹50,000 each), TDS @ 2% must be deducted from each invoice if the overall contract value surpasses ₹2,50,000.

When is GST TDS NOT deductible even if the contract value exceeds ₹2.5 Lakhs?

Under the proviso to Section 51(1), no deduction is required when the location of the supplier and the place of supply are in a State/UT which is different from the State/UT of registration of the recipient/deductor. Furthermore, TDS is not applicable on exempt supplies, nil-rated goods, or transactions where the recipient pays under reverse charge mechanism (RCM).

Does an online seller on their own standalone website need to collect GST TCS?

No. GST TCS under Section 52 applies strictly to E-Commerce Operators who facilitate supplies for other third-party vendors on digital marketplaces (like Amazon, Flipkart, or Meesho). If an enterprise sells its own products directly through its proprietary brand website, it is not acting as an ECO for third parties and Section 52 TCS does not apply.

What is the late fee and interest for delayed filing of GSTR-7 or GSTR-8?

Late filing of GSTR-7 or GSTR-8 attracts a statutory late fee under Section 47 (₹50 per day subject to statutory caps) plus mandatory interest under Section 50 @ 18% per annum calculated from the 11th day until the date of actual deposit.

Can unutilized GST TDS and TCS balances in the Electronic Cash Ledger be refunded?

Yes. Unlike Input Tax Credit (ITC) which has restricted refund avenues, balances in the Electronic Cash Ledger arising from GST TDS and TCS deductions can be claimed as a direct cash refund to the taxpayer's bank account by filing Form RFD-01 under Section 54 of the CGST Act.

GST Indirect Tax MasterclassSeptember 20267 min readChartered Accountant Verified

GST TDS & GST TCS: Section 51 vs Section 52 Explained for Accountants & Businesses

Name: SM Accounting Consultancy
Address: Shop No. A/407, Rashmi growth hub-2, Opp. Vishala 11 1, Opp. Orchid Restaurant, S.P. Ring road, Odhav, Ahmedabad, Gujarat, 382415, IN
Telephone: +91 9898109140
Price range: ₹₹

A comprehensive statutory breakdown of Tax Deducted at Source (Section 51) and Tax Collected at Source (Section 52). Understand who deducts, applicability thresholds, tax rates, monthly return compliance (GSTR-7 & GSTR-8), cash ledger credits, and live worked examples.

By SM Accounting Consultancy

Chartered Accountants • Practice Desk Ahmedabad

WhatsApp Share

Section 51 TDS Section 52 TCS TDS vs TCS Matrix Live Tax Calculator Key Takeaways FAQs

Statutory Architecture Overview

The Indian Goods and Services Tax (GST) Act incorporates specific withholding tax provisions to curb evasion, verify transactions through automatic electronic trails, and collect revenue at early supply stages. While both GST TDS (Section 51) and GST TCS (Section 52) withhold tax from payouts, their operational models, statutory thresholds, and reporting compliance are distinctly separated.

STATUTORY INFOGRAPHIC MATRIX

GST TDS & GST TCS: Side-by-Side Breakdown

Every accountant, contractor, and e-commerce vendor must understand these fundamental legal obligations.

1. GST TDS (Section 51)

Tax Deducted at Source

Deducted by Government & notified entities upon contract payments.

Who Deducts?Notified Deductors

•Central Government departments
•State Government departments
•Local Authorities (Municipalities, Panchayats)
•Government Agencies
•Public Sector Undertakings (PSUs)
•Other notified persons / government societies

When Applicable?Threshold Rule

When the total contract value exceeds ₹2,50,000 (excluding GST), the supplier is GST registered, and the supply of goods or services is taxable.

Exemption: No TDS if location of supplier & place of supply are in State A, while the recipient is registered in State B.

Rate of TDS

Intra-State Supply1% CGST + 1% SGST= 2.0%

Inter-State Supply2% IGST= 2.0%

Due Date & Return Filing

Deposit TDS:Within 10 days of next month

Monthly Return:Form GSTR-7

TDS Certificate:Form GSTR-7A

Worked Example CalculationSection 51 Math

Contract Value (excl. GST):₹5,00,000

GST @18%:₹90,000

Invoice Value:₹5,90,000

TDS @2% on ₹5,00,000:- ₹10,000

Payment to Supplier:₹5,80,000

* ₹10,000 TDS credits directly to supplier’s Electronic Cash Ledger upon filing.

2. GST TCS (Section 52)

Tax Collected at Source

Collected by E-commerce Operators (ECO) from online marketplace sellers.

Who Collects?E-Commerce Operators

Exclusively E-Commerce Operators (ECO) who manage digital marketplaces facilitating vendor sales.

amazonFlipkart ⚡meeshoMyntraBlinkit / Swiggy

On What Amount?No Threshold

Calculated on the Net Value of Taxable Supplies.

Net Taxable Supply = Gross Sales − Sales Returns

Rate of TCS

Intra-State Supply0.25% CGST + 0.25% SGST= 0.50%

Inter-State Supply0.50% IGST= 0.50%

Due Date & Return Filing

Deposit TCS:Within 10 days of next month

Monthly Return:Form GSTR-8

Annual Return:Form GSTR-9B

Worked Example CalculationSection 52 Math

Total Sales through ECO:₹10,00,000

Sales Returns:- ₹1,00,000

Net Taxable Supply:₹9,00,000

TCS @0.50% (on ₹9 Lakh):₹4,500

ECO Deposits with Govt:₹4,500

* ₹4,500 TCS credited to seller's Electronic Cash Ledger upon GSTR-8 matching.

Definitive Comparison

TDS vs TCS — At a Glance

Quick-reference matrix of statutory provisions under the Central Goods and Services Tax Act.

Particular	GST TDS	GST TCS
Governing Section	Section 51	Section 52
Applicable To / Collector	Government Departments, Local Authorities, PSUs & Notified Entities	E-Commerce Operators (ECO) facilitating supplies of others
Statutory Threshold	Contract Value > ₹2,50,000 (excl. GST)	No Threshold (applicable from ₹1 of net sales)
Rate (Intra-State Supply)	1% CGST + 1% SGST = 2.00%	0.25% CGST + 0.25% SGST = 0.50%
Rate (Inter-State Supply)	2.00% IGST	0.50% IGST
Monthly Return Form	Form GSTR-7	Form GSTR-8
Deposit Deadline	Within 10 days of subsequent month	Within 10 days of subsequent month
Certificate / Proof	Form GSTR-7A (within 5 days)	Auto-populated in GST Portal
Credit to Supplier	Electronic Cash Ledger	Electronic Cash Ledger

Interactive CA Tools

Live GST TDS & TCS Tax Calculator

Instantly simulate deductions, verify the ₹2.5 Lakh contract threshold, and compute net payouts.

Contract Value (Excl. GST)

₹

Threshold: Exceeds ₹2,50,000

Applicable GST Rate (%)

Supply Classification

TDS Compliance Outcome✓ GST TDS Applicable (> ₹2.5L)

GST Tax Amount₹90,000

Total Invoice Value₹5,90,000

TDS Deducted (2%)₹10,000

Net Payout to Vendor₹5,80,000

Accounting Entry Note: Vendor accounts for full invoice revenue of ₹5,90,000. The ₹10,000 withheld by the Government deductor is deposited into the Treasury and credited to the vendor’s Electronic Cash Ledger upon filing GSTR-7.

Statutory Summary

Key Compliance Takeaways for Businesses

“Timely compliance of GST TDS & TCS ensures smooth cash flow, avoids penalties, and helps in accurate GST reporting.”

Interest Penalty for Late Deposit

Non-deposit or delayed deposit beyond the 10th of the following month attracts mandatory statutory interest under Section 50 at 18% per annum.

Cash Ledger Refund Entitlement

Unlike restricted Input Tax Credit (ITC), accumulated GST TDS & TCS balances in the Electronic Cash Ledger can be refunded in liquid cash directly to your bank account via Form RFD-01.

Companion Direct Tax Masterclass

HUF Tax Saving Guide: How Indian Families Save ₹2.5+ Lakhs Legally

Dual basic exemptions, dual 80C deductions, Section 87A rebate rules, and 4-step HUF formation.

Read HUF Guide

Frequently Asked Questions

GST TDS & TCS: Practical CA Answers

When the deductor files Form GSTR-7 (for TDS) or the e-commerce operator files Form GSTR-8 (for TCS), the details auto-populate in the supplier's "TDS and TCS Credit Received" tab on the GST portal. Once the supplier verifies and accepts these entries, the full amount is credited to their Electronic Cash Ledger, which can be used to pay future taxes or claimed as a cash refund.

Statutory Services

Related Professional Practice Services in Ahmedabad

Request Practice Consultation

Provide basic details to initiate a structured tax and audit review session.

Full Name *

Phone / WhatsApp *

10-digit mobile number

Email Address

For booking confirmation

Entity Type

Select Required Service *

Brief Requirement Context

Strict ICAI Professional Non-Disclosure Standards

Direct CA Consultation

Questions on GSTR-7, GSTR-8 or Cash Ledger Reconciliation?

Speak directly with our founding partners in Ahmedabad for tailored business taxation advisory.

Call +91 9898109140 WhatsApp Consultation