ITC on Amazon and Flipkart Commission: Can You Claim It?

Yes, a seller registered as a regular GST taxpayer can normally claim ITC on Amazon and Flipkart commission, shipping fees and other marketplace charges, because they are business expenses. The credit is allowed only when the fee invoice shows in your GSTR-2B, you meet the conditions in section 16, and nothing in section 17 blocks it.

Can you claim ITC on marketplace commission?

Section 16(1) of the CGST Act lets a registered person take credit of GST charged on goods or services used, or meant to be used, in the course of business. Commission, closing fees, shipping and storage charges and advertising on the platform are all spent to make sales. So the GST on them is credit in the ordinary case.

The credit goes to your electronic credit ledger and reduces the GST you pay in cash through GSTR-3B.

What conditions does section 16 set?

Section 16(2) lists conditions that must all be met. Here is what each means for a fee invoice.

Where do you see the invoice on the GST portal?

GSTR-2B is a read-only statement of your credit, built from the returns your suppliers file. The portal generates it on the 14th of the next month. Open it from Services, then Returns, then Returns Dashboard, choose the period and click the GSTR-2B tile. You can download it in Excel.

The portal also has an Invoice Management System (IMS) dashboard under Services, then Returns. There you can accept, reject or keep pending each invoice a supplier has reported. If you take no action, the invoice is treated as accepted when GSTR-2B is generated.

GSTR-2B puts some invoices under "ITC not available". One case is where the supplier and the place of supply are in one State and you are registered in another. If a fee invoice lands there, ask the marketplace to check the GSTIN and State it billed.

Where do you download the commission invoices?

Each marketplace keeps fee invoices in its seller panel, usually in a tax or invoice section under reports. We have not named the exact screens because we could not read them on the marketplaces' own help pages today, and they change. Two practical points:

• Fees may be billed by more than one company or GSTIN, for example one for commission and another for logistics or advertising. Collect all of them.
• Check that each invoice carries your correct GSTIN. If you have registrations in several States, the credit sits with the GSTIN that was billed.

When is the credit blocked or cut down?

• Personal use. Section 17(5)(g) blocks credit on goods or services used for personal consumption. Fees on orders that are not part of your business do not qualify.
• Exempt sales. Under section 17(2), if you sell both taxable and exempt goods, only the part of the credit that relates to taxable sales, including zero-rated supplies, is allowed.
• Composition scheme. Section 17(5)(e) blocks credit on supplies on which tax has been paid under section 10, the composition scheme. A composition taxpayer also does not set off credit in the way a regular taxpayer does.
• Late claims. Section 16(4) stops you from taking credit on an invoice after 30 November following the end of the financial year it belongs to, or after you file the annual return for that year, whichever is earlier. For a fee invoice dated in 2025-26, the last date is 30 November 2026.

What is the 180-day reversal?

Section 16(2) says that if you do not pay your supplier the value of the supply and the tax on it within 180 days from the invoice date, you must pay back the credit you took, with interest. Rule 37 adds the detail. The reversal is in proportion to the amount not paid. It is made in the GSTR-3B for the tax period right after the 180 days end. Once you pay the supplier, you can take the credit again, and the 30 November limit does not apply to that re-claim.

For marketplace fees this seldom bites, since the marketplace usually recovers its fees from your payout. In our reading that recovery counts as payment, but the law does not spell this out. If you have fee invoices in dispute or unpaid advertising bills, ask your CA.

A worked example

Farhan sells shoes online. In one month his GST on sales is Rs 22,500. The marketplace charged fees of Rs 90,000. The fee invoices show GST of Rs 16,200, which is 18% as printed on them. Check the rate on your own invoices.

• All invoices are in GSTR-2B: ITC Rs 16,200. GST to pay is Rs 22,500 less Rs 16,200 = Rs 6,300, assuming the tax heads allow the set-off.
• One advertising invoice of Rs 10,000 plus GST Rs 1,800 is missing from GSTR-2B: he claims Rs 14,400 this month and pays Rs 8,100. He follows up, and claims Rs 1,800 in the month it appears.
• He never downloads GSTR-2B and claims nothing for a year: about Rs 1,94,400 of credit is at risk once 30 November passes.

The TCS collected by the marketplace is a different thing. It is not ITC and does not come through GSTR-2B. See how to claim TCS credit.

The mistake most sellers make

Sellers pick the fee total from the settlement report and claim 18% of it as credit. That figure often differs from GSTR-2B. Some fees are billed in a later month, some lines are reimbursements with no GST, and some invoices go to another GSTIN. A claim higher than GSTR-2B invites a notice.

The opposite mistake is just as common: the seller files GSTR-3B with zero credit every month because nobody looked. Marketplace fees are a large cost, as the article on profit after fees and GST shows, and unclaimed credit is plain loss.

Frequently asked questions

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