E-Invoice and TCS Calculator for GST Sellers in India

Two Compliance Duties That Arrive as Your Business Grows

Run a growing business in India and two GST duties creep up on you, often without warning. The first is e-invoicing, the requirement to report every business-to-business invoice to a government portal and get a unique reference number before the invoice is even valid. The second is tax collected at source, or TCS, which a marketplace withholds from your payout when you sell online. They sound technical, and most owners meet them the hard way: a buyer rejects an invoice for a missing reference number, or a payout arrives one per cent lighter than expected. This tool lets you see both coming before they bite.

The two duties are linked because they both attach to the same journey, a business scaling up and selling through more channels. E-invoicing switches on when your turnover crosses a threshold, and TCS applies the moment you sell through an online marketplace, regardless of size. A small seller listing on a marketplace meets TCS first. A growing manufacturer or distributor meets e-invoicing first. A business doing both, an online seller that has scaled past the turnover line, meets them together, and that is exactly the situation this calculator is built for.

The single most misunderstood point about e-invoicing is the turnover test. It is not based on your current turnover; it is based on the highest aggregate turnover you have recorded in any financial year since 2017-18. Cross the threshold even once, in a single strong year, and the obligation attaches permanently, even if your turnover later falls back below it. This catches out textile units, traders and manufacturers who had one big year and then scaled back, and they usually discover it only when a buyer refuses an invoice. The tool asks for your highest turnover for precisely this reason.

TCS is misunderstood in the opposite direction. Sellers see one per cent of their sales withheld and treat it as a cost, a tax on selling online. It is not a cost at all for a compliant seller. The marketplace deposits it against your GST number, and you claim it straight back as a credit that offsets your GST liability. The only real economic effect is that the money is locked for a while, a working-capital cost, not a tax. The tool separates the withheld amount from the genuine cost so you can see that the one per cent is coming back and only the timing matters.

Putting the two together, the honest summary is that neither duty is as frightening as it first looks, but both punish neglect. E-invoicing is not hard once set up, yet ignoring it invalidates your invoices and hurts your buyers. Marketplace TCS is not a cost, yet failing to reconcile and claim it leaves your own money sitting with the government. The value of seeing both in one place is that you stop treating them as mysterious deductions and start treating them as routine, manageable steps in running a compliant business. That shift, from anxiety to routine, is what this tool is really for.

How E-Invoicing and Marketplace TCS Actually Work

Each part of the tool follows the real rules. Here is what happens in each, so you can trust the output and act on it.

When e-invoicing becomes mandatory

E-invoicing applies when three conditions are all met. Your aggregate annual turnover, added across every GST registration under your PAN, crossed five crore in any financial year since 2017-18. You make business-to-business supplies, exports, supplies to a special economic zone, or supplies to government; pure business-to-consumer retail is outside the rule. And your business does not fall in a notified exempt category such as a bank, insurer, Goods Transport Agency, passenger transport service, SEZ unit or cinema. When all three hold, you must generate an invoice reference number, an IRN, for every applicable invoice through the portal before the invoice is legally valid.

The 30-day reporting rule

Generating the IRN is only half the duty. If your aggregate turnover is ten crore or more, you must report each invoice, credit note and debit note to the portal within thirty days of the invoice date. Report it late and the portal simply blocks the reference number, which means you cannot issue a valid invoice for that transaction at all. Below ten crore you must still generate IRNs, but this hard thirty-day stop does not yet apply. The tool tells you which side of the ten crore line you are on, because the consequence of missing the window is severe.

The thirty-day rule has a history that explains the confusion you may see online. It started as a much tighter seven-day window applied only to very large taxpayers, then in a late-2024 advisory the reporting threshold was set at ten crore and the window standardised at thirty days from the first of April 2025. Older guides still mention seven days, which no longer applies to most businesses. The practical takeaway is simpler than the history: if you are at or above ten crore, treat thirty days as a hard deadline per document, and the safest habit is to report at the point of issue so you never drift toward the edge of the window during a busy month.

How marketplace TCS is collected

When you sell through an online marketplace, the operator collects one per cent of the net taxable value of your sales as TCS under Section 52 of the CGST Act. Net value means your gross sales through that platform minus returns, discounts and exempt supplies. The one per cent splits as half central and half state GST for a sale within your state, or a single integrated GST for an inter-state sale. The marketplace files its own monthly return and deposits your TCS against your GST number, so it appears as a credit waiting for you to claim.

A point that trips up new sellers is that the TCS is on net value, not gross, and the netting genuinely matters for a returns-heavy category. If you sell fashion or electronics where a meaningful share of orders come back, your net taxable value after returns can be well below your gross order value, and the TCS follows the net. This is why the tool asks for net monthly sales rather than gross: entering gross would overstate both the TCS withheld and the cash-flow cost. Keep your own record of returns and reconcile it against what the marketplace reports, because an operator that nets returns differently from you is a common source of the small mismatches that cost sellers credit.

Claiming the TCS credit back

The TCS is not lost. You claim it through the TDS and TCS credit received return on the GST portal, which moves it into your electronic cash ledger, where it offsets your GST liability just like cash. So over a full cycle the one per cent is neutral: withheld, then recovered, then used to pay tax you owed anyway. The only cost is the gap between the marketplace withholding it and you recovering it, during which that money is working for the government rather than for you. The tool values that gap so you know the true, small cost of selling on a marketplace, as distinct from the scary-looking one per cent.

One subtlety is worth knowing for a seller on several platforms. Each marketplace reports and deposits your TCS separately, so your credit ledger shows a line from each one, and you accept them together in the single credit return. This is why reconciliation matters: with three or four platforms, a single under-reported entry is easy to miss, and every missed entry is credit you have effectively gifted away. The tool computes the TCS on your total net sales, but in practice you claim it platform by platform, so the discipline of matching each marketplace figure against your own sales record is what turns the tool estimate into money actually back in your ledger.

Getting Ready Before Either Rule Catches You

The businesses that handle these rules smoothly are the ones that prepared before they were forced to, and the tool is most useful used that way, as an early-warning check rather than a post-mortem. On the e-invoicing side, the preparation is practical. You need access to the invoice registration portal or billing software that connects to it, a clean master of your buyers with their GST numbers, and a process that generates the reference number at the moment of invoicing rather than as an afterthought. Set this up when you are approaching five crore, not after a buyer has already rejected an invoice, because the rejection means your buyer cannot claim credit and your working relationship takes the hit.

On the TCS side, preparation is about reconciliation discipline. Every month each marketplace reports the TCS it withheld from your sales, and you need to match that against your own record of what you sold through that platform. If the marketplace under-reports, you lose credit you were owed; if there is a mismatch, your claim can stall. Sellers who treat the TCS credit return as a monthly ritual, accepting the entries and moving the credit into their ledger, keep their working capital free and their books clean. Those who let it pile up for a quarter or more end up with locked cash and a reconciliation headache at return time.

There is also a mindset shift worth making as you cross these lines. Below the thresholds, GST compliance is relatively forgiving. Above them, the system assumes you have systems: real-time invoice reporting, monthly credit reconciliation, tight deadlines with hard stops. This is not a reason to fear growth, but it is a reason to invest a little in process as you scale, because the cost of a blocked reference number or a missed thirty-day window lands at the worst possible moment, when you are busy running a larger business. The tool gives you the map; the preparation is what keeps the journey smooth.

Finally, keep an eye on the direction of travel. The e-invoicing threshold has only ever fallen, from five hundred crore at launch down to five crore today, and lower figures have been discussed. The thirty-day reporting rule has widened to cover more taxpayers. The safe assumption is that these obligations will reach more businesses over time, not fewer, so even if you are comfortably below the lines today, understanding how they work is an investment in the version of your business that exists a few good years from now. Running your own numbers through the tool once a year, as your turnover grows, is a cheap way to never be caught out.

It also helps to brief the right people once you are close to a threshold. Your accountant needs to know your highest turnover year so they can confirm your e-invoicing status; your billing team or software vendor needs lead time to switch on IRN generation; and whoever handles your marketplace payouts needs to own the monthly TCS credit claim. None of this is difficult, but it spans a few hands, and the failures usually happen in the gaps between them, an invoice raised by someone who did not know the rule had switched on, or a TCS credit nobody was tasked to claim. Using the tool to produce a clear, shareable answer, and then assigning each resulting action to a named person, is what turns a compliance risk into a solved problem.

The Thresholds, Rates and Rules in One Place

These are the figures the tool uses, drawn from current GST rules. Confirm anything specific to your business against the official portals at the e-invoice portal and gst.gov.in.

E-invoicing thresholds

E-invoicing scope and exemptions

GST TCS under Section 52

A note on Income Tax TCS

Do not confuse GST TCS with the Income Tax TCS under Section 206C, which is a completely separate provision covering the sale of scrap, timber and minerals, motor vehicles above ten lakh, and foreign remittances under the Liberalised Remittance Scheme. Importantly, the old Section 206C(1H) TCS on the sale of goods above fifty lakh was abolished from the first of April 2025, so any tool still computing it is out of date. This calculator handles GST TCS under Section 52, the one that affects marketplace sellers.

Three Worked Examples From Real Indian Businesses

Here are three owners in three cities, each meeting these rules at a different stage, so you can see how the tool answers their real question.

Kavita in Surat discovers e-invoicing from an old year

Kavita runs a textile trading firm in Surat. Her turnover this year is about four crore, so she assumed e-invoicing did not apply to her. But in the strong post-pandemic year of 2022-23 her turnover touched six crore for that one year before settling back. On the tool she enters six crore as her highest turnover since 2017-18, selects B2B, and sees the verdict clearly: e-invoicing is mandatory for her, permanently, because she crossed five crore once. She is under ten crore, so the thirty-day reporting stop does not yet apply.

The tool has caught exactly the trap that would otherwise have surfaced when a buyer rejected one of her invoices for a missing reference number, and she now sets up IRN generation before that happens. Kavita realises she has probably been non-compliant for a while without knowing it, so she also raises the point with her accountant to understand her exposure on invoices already issued. The lesson she takes is that the turnover test looks backwards, not at the current year, and that a single strong year has a long tail. Had she relied on her current four crore, she would have carried on issuing invalid invoices until a buyer or an audit forced the issue.

Imran in Lucknow sells on a marketplace

Imran sells home furnishings on a large marketplace from Lucknow, with net sales of ten lakh a month, all intra-state within Uttar Pradesh. On the TCS tab he enters ten lakh and intra-state. The tool shows the marketplace withholds ten thousand rupees a month as TCS, split five thousand central and five thousand state GST. Crucially, the verdict tells him this is not a cost: he claims it back as a credit in his electronic cash ledger and it pays part of his GST liability. The only genuine cost is the cash-flow gap, about ninety-nine rupees this month at a twelve per cent cost of capital over thirty days, or roughly one thousand one hundred and eighty-eight rupees across a full year.

Imran stops worrying about the one per cent and simply makes sure he claims the credit every month. Before using the tool he had been mentally treating the withheld amount as a marketplace charge, and had even considered raising his prices by one per cent to cover it, which would have made his listings less competitive for no reason. Seeing that the money comes back changes his pricing decision entirely. He keeps his prices where they are, sets a monthly reminder to accept the TCS credit, and treats the small cash-flow cost as the minor overhead of selling online that it actually is.

Deepa in Coimbatore scales past both lines

Deepa runs a growing appliances business in Coimbatore that has just crossed twelve crore in turnover and sells both directly to dealers and through an online marketplace. She uses both tabs. On the e-invoice tab, twelve crore and B2B supplies mean e-invoicing is mandatory and, because she is over ten crore, the thirty-day reporting rule now applies, so she must report every invoice within thirty days or lose the ability to issue it. On the TCS tab, her marketplace arm with net sales of fifteen lakh a month has fifteen thousand withheld monthly, recoverable, with a modest yearly cash-flow cost.

Seeing both together, Deepa realises her compliance load just stepped up on two fronts at once, and she briefs her accountant to tighten both processes before the thirty-day rule catches an invoice. What strikes her most is the timing: crossing ten crore did not just raise the stakes on e-invoicing, it added a hard deadline that did not exist a year ago at her smaller size. She puts a rule in place that every invoice is reported to the portal on the day it is raised, removing any chance of drifting past thirty days during a busy month. The tool turned a vague sense that compliance was getting heavier into two specific actions she could delegate immediately.

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