Zero Commission, Worked Out: A Sample Payout With TCS and TDS
Zero commission means the marketplace does not take a percentage of your selling price. It does not mean zero deductions. Your payout is still the order value less shipping and other fees, GST on those fees, returns, GST TCS at 0.5% of net taxable sales and income tax TDS at 0.1% of gross sales.
- Zero commission removes one fee: the percentage of your price. Shipping, fixed and return fees can still apply.
- GST on the fees that remain is input tax credit for a seller with a GSTIN.
- TCS of 0.5% (0.25% central plus 0.25% State) applies to net taxable sales since 10 July 2024, under Notification 15/2024-Central Tax.
- TDS of 0.1% under section 194-O applies to the gross amount of sales, and is section 393 of the Income-tax Act, 2025 from tax year 2026-27.
- Your GSTR-1 reports sales less returns, never the payout.
In this guide
What is actually free under zero commission?
The headline says zero. Your bank credit says something else. Who is right? Both, because commission is only one of several lines on a settlement. Here is what we could read on the marketplaces' own pages today.
| Marketplace | What its own page says, as on 12 Nov 2026 | What still applies |
|---|---|---|
| Amazon | Referral fee of 0% for item price up to Rs 1,000 in most categories on its fee schedule, with lower caps (such as Rs 250 or Rs 300) in some. Its footnote says the change applies to select categories. | Closing fee by price band, weight handling (shipping) fee from Rs 37 an item, pick and pack and storage for FBA, and 18% GST on all fees |
| Flipkart | Its newsroom announced on 8 July 2026 that zero commission covers all fashion products at every price point, up from fashion priced up to Rs 1,000. | Other fees and other categories were not on that page. Read your rate card in Seller Hub |
| Meesho | We could not open Meesho's supplier pages today, so no rate is given. | Read the current rate card, shipping charges and penalty list in your supplier panel |
So the honest way to read zero commission is "one fee fewer". It is a real saving. It is not a payout equal to your price.
Which deductions remain, and which come back?
| Deduction | Worked out on | Do you get it back? |
|---|---|---|
| Returns and RTO | Full order value | No. The sale is reversed |
| Shipping, fixed, closing or return fees | The marketplace rate card | No. A business cost |
| GST on those fees | The fee amount | Yes, as input tax credit in GSTR-3B |
| GST TCS | 0.5% of taxable sales less returns | Yes, through your electronic cash ledger |
| Income tax TDS | 0.1% of gross sales | Yes, against your income tax |
TCS is tax collected at source. Section 52 of the CGST Act makes the marketplace collect it on your net taxable sales for the month and report it in its return, GSTR-8. You claim it on the GST portal. TDS is tax deducted at source under income tax. An individual or HUF whose gross sales through that marketplace stay within Rs 5 lakh in the year, and who has given PAN or Aadhaar, has no TDS deducted.
A worked example
Ravi sells cotton kurtas on Flipkart from Jaipur, in a fashion category where commission is zero. Each kurta is priced Rs 1,050 including GST: Rs 1,000 taxable value and Rs 50 GST, taking the rate as 5%. In one month he ships 200 and 20 come back.
The fees below are assumed for the example. Take your own numbers from your fee invoice.
| Line | Working | Amount |
|---|---|---|
| Orders shipped, with GST | 200 x Rs 1,050 | Rs 2,10,000 |
| Less: returns, with GST | 20 x Rs 1,050 | Rs 21,000 |
| Net sales, with GST | Taxable Rs 1,80,000 plus GST Rs 9,000 | Rs 1,89,000 |
| Commission | Zero | Rs 0 |
| Less: shipping and fixed fees (assumed) | 180 x Rs 70 = Rs 12,600, plus 18% GST Rs 2,268 | Rs 14,868 |
| Less: return fees (assumed) | 20 x Rs 50 = Rs 1,000, plus 18% GST Rs 180 | Rs 1,180 |
| Less: TCS | 0.5% of Rs 1,80,000 | Rs 900 |
| Less: TDS | 0.1% of Rs 2,00,000 | Rs 200 |
| Payout | Rs 1,71,852 |
The gap between net sales and payout is Rs 17,148. How much of it is a true cost?
- Fees of Rs 12,600 and Rs 1,000: gone. Rs 13,600 in all, about Rs 76 per kurta that stayed sold.
- GST on fees of Rs 2,448: back as input tax credit.
- TCS of Rs 900: back through the cash ledger.
- TDS of Rs 200: back against income tax.
So Rs 3,548 of the gap is Ravi's money parked with the government. If he forgets it, his zero commission month quietly costs him another 2% of net sales. The TDS base here is one reasonable reading; check which amount your statement applies 0.1% to.
How to check your own settlement, step by step
- Download the sales or GST report and the payment report for the same month. The click paths are in our guides for Flipkart, Amazon and Meesho.
- Total taxable sales and taxable returns. The difference is your GSTR-1 figure.
- Check the commission column really is zero on the listings you expected to be covered.
- Add up every other fee and the GST on it. Match the GST with the fee invoice and your GSTR-2B.
- Multiply net taxable sales by 0.5% and compare with the TCS line.
- Tick the payout total against your bank statement.
Once TCS appears on the portal, claim it as shown in how to claim TCS credit.
The mistake people usually make
They price for zero commission and forget the other fees. If Ravi had set his price at cost plus Rs 50, the Rs 76 of fees per kurta would have put him in a loss on every sale, before a single return.
The second mistake is filing GSTR-1 on the payout of Rs 1,71,852. Flipkart reports net sales of Rs 1,80,000 against Ravi's GSTIN in GSTR-8. File on Rs 1,72,000 or so and the two records disagree, which is how a mismatch notice starts.
The third is skipping the credit on fees. Read input tax credit on marketplace fees for when it is allowed. For the profit side, see profit after fees and GST, and for Meesho's payment lines, the Meesho payment calculation.
Sources
- Amazon fees and pricing: referral, closing and weight handling fees (sell.amazon.in) (checked 12 Nov 2026)
- Flipkart newsroom, 8 July 2026: zero commission across fashion (stories.flipkart.com) (checked 12 Nov 2026)
- Notification 15/2024-Central Tax dated 10 July 2024: TCS rate (GST Council) (checked 12 Nov 2026)
- CGST Act, section 52 (CBIC copy, updated to 30 September 2020) (checked 12 Nov 2026)
- Section 194-O, Income-tax Act, 1961 (Income Tax Department) (checked 12 Nov 2026)
- Section 393, Income-tax Act, 2025 (Income Tax Department) (checked 12 Nov 2026)
- Meesho supplier site (could not be opened today)
How AprilTax can help
AprilTax has a free GSTR-1 tool for online sellers. Upload the sales reports you download from Flipkart, Amazon or Meesho and it prepares your GSTR-1 on sales less returns, not on the payout. It runs about 30 checks, matches the TCS your marketplaces reported, and gives you a JSON file to upload on the GST portal yourself.
Frequently asked questions
Does zero commission mean I get the full selling price?
Is TCS deducted even when commission is zero?
Is TDS under section 194-O deducted on zero commission sales?
Which Flipkart products have zero commission?
Does Amazon charge a referral fee on low-priced items?
Should I file GSTR-1 on the payout amount?
Can I claim GST charged on marketplace fees?
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