GSTR-7 and GSTR-8: The Two Collector Returns

GSTR explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.

Most GST returns report a person's own supplies. These two report what someone withheld from a third party, and the amount lands in that third party's cash ledger.

Section 51 — TDS. Notified deductors deduct 1% CGST + 1% SGST, or 2% IGST, from payments to a supplier where the total value of supply under a contract exceeds ₹2,50,000, excluding tax. Return in FORM GSTR-7, by the 10th of the following month; certificate in GSTR-7A. Section 52 — TCS. An electronic commerce operator collects 0.5% CGST + 0.5% SGST, or 1% IGST, on the net value of taxable supplies made through it by other suppliers. Statement in FORM GSTR-8, by the 10th.

Section 51: who deducts

(a) a department or establishment of the Central Government or State Government; (b) local authority; (c) governmental agencies; (d) such persons or category of persons as may be notified by the Government on the Council's recommendation.

The notified category includes an authority, board or other body set up by Parliament or a State Legislature or established by a Government with 51% or more equity or control; a society established by the Central or State Government or a local authority registered under the Societies Registration Act, 1860; and public sector undertakings.

The ₹2,50,000 threshold and its exclusions

Deduction is required where the total value of such supply, under a contract, exceeds ₹2,50,000 — and the Explanation clarifies that for this purpose the value shall exclude the central tax, State tax, Union territory tax, integrated tax and cess indicated in the invoice.

So the test is on the contract value excluding GST, not on the invoice or the payment.

No deduction is required where the location of the supplier and the place of supply is in a State or Union territory which is different from the State or Union territory of registration of the recipient — the proviso to s.51(1). That prevents a deductor from having to register and deposit in a State where it has no presence.

The mechanics of TDS

s.51(2) — the amount deducted shall be paid to the Government within ten days after the end of the month in which the deduction is made.

s.51(3) — a certificate shall be issued, in FORM GSTR-7A, generated automatically once GSTR-7 is filed.

s.51(5) — the deductee shall claim credit, in his electronic cash ledger, of the tax deducted and reflected in the return of the deductor.

s.51(6) — where the deductor fails to pay the amount to the Government, he shall pay interest under s.50(1).

s.51(7) — the determination of the amount in default shall be made in the manner specified in s.73, s.74 or s.74A.

Note s.51(5): the credit goes to the cash ledger, not the credit ledger. It is money, not input tax.

Section 52: who collects

Every electronic commerce operator, not being an agent, shall collect an amount calculated at the notified rate, not exceeding one per cent, of the net value of taxable supplies made through it by other suppliers where the consideration with respect to such supplies is to be collected by the operator.

"Net value of taxable supplies" — the Explanation: the aggregate value of taxable supplies of goods or services, other than services notified under s.9(5), made during any month by all registered persons through the operator, reduced by the aggregate value of taxable supplies returned to the suppliers during that month.

Two consequences:

Section 9(5) services are excluded, because the operator pays the tax on those itself.

Returns are netted in the month of return, so a month with heavy returns produces a lower TCS base — and can produce a negative figure, which is carried.

The mechanics of TCS

s.52(3) — the amount collected shall be paid to the Government within ten days after the end of the month.

s.52(4) — a statement in FORM GSTR-8, electronically, containing the details of outward supplies effected through the operator, including supplies returned, and the amount collected.

s.52(7) — the supplier shall claim credit, in his electronic cash ledger, of the amount collected and reflected in the statement.

s.52(8) to (11) — the matching provisions: details furnished by the operator are matched with the corresponding details of outward supplies furnished by the supplier; a discrepancy is communicated to both; if not rectified, the amount is added to the output tax liability of the supplier in the succeeding month, with interest.

s.52(12) — an officer not below the rank of Deputy Commissioner may serve a notice requiring the operator to furnish details of supplies effected through it and stock held; s.52(13) — reply within fifteen working days; s.52(14) — penalty up to ₹25,000 for failure.

Key differences

Key takeaways

• TDS under s.51 at 2% aggregate, where the contract value excluding tax exceeds ₹2,50,000.
• No TDS where the supplier's location and the place of supply are in a State different from the deductor's registration State.
• TCS under s.52 at 1% aggregate, on the net value of taxable supplies, excluding s.9(5) services.
• Both are paid within ten days after the month and returned in GSTR-7 or GSTR-8 by the 10th.
• Both credit the supplier's electronic cash ledger, not the credit ledger.
• TCS has a statutory matching mechanism; TDS does not.

Read next

• TDS Under GST: Who Must Deduct
• TCS for E-Commerce Operators: Section 52
• GSTR-7: Filing the TDS Return Step by Step
• GSTR-8: Filing the TCS Return for E-Commerce Operators

Disclaimer: Positions stated as on 5 September 2026, based on the CGST Act and Rules as amended to 31 March 2026 (ICAI Bare Law, 12th edition) and the ICAI Handbook on E-Commerce Operators under GST.