More and more people are selling things on ONDC, the Open Network Digital Commerce.
ONDC, like UPI for online shopping, is becoming more and more popular.
At the same time, the Tax Department has explained the rules about taking away some money (TDS) from people who sell things online on ONDC.
TDS at the rate of 1 percent
CBDT, which stands for Central Board of Direct Taxes, released a new circular on Thursday.
In the circular, CBDT explained that a 1 percent deduction would apply to e-commerce sales.
This deduction applies to the whole amount of sales, including charges and fees collected by different e-commerce operators, along with the goods and services provided on ONDC.
This is why CBDT’s circular came
The Indian Government is telling people about ONDC. ONDC started in 2020.
It wants to make e-commerce better, like how UPI made buying things online easier. Now, ONDC is growing, and more e-commerce shops are joining.
To make things clear, CBDT has tried to explain the rules by sending out a paper about taking away some money (TDS) and who is responsible for taxes.
TDS on all types of charges
As per CBDT rules, e-commerce websites add different fees for both the person selling and the person buying things.
These fees include packing, delivery, and convenience charges, among others. CBDT says they will take away some money (TDS) from all these charges.
This deduction will happen when the seller’s side of the online shop pays or credits the money.
The online shop also needs to report this deduction and give a certificate to the seller.
TDS in case of return-replace
CBDT has also clarified how they will take away some money (TDS) if you return something you bought. CBDT says they will deduct TDS when you buy something as usual.
But if you return it, the deducted tax can be fixed in another purchase in the same year. If you replace what you bought, no adjustment is needed.
