India

Here's an overview of the marketplaces in india reporting regime similar to DAC7 in Europe, particularly focusing on Tax Deducted at Source (TDS) for online marketplaces in India E-commerce Operators. Indian e-commerce-operator reporting (TDS) became mandatory on 1 October 2020. This requirement significantly impacts popular online marketplaces in India. First reporting cycle: the first Form 26Q was due on 31 January 2021.

Who needs to register

E-commerce Operators are required to register for TDS under Section 194-O. An e-commerce operator is defined as: Any person who owns, operates, or manages a digital or electronic facility or platform for the sale of goods or provision of services or both, including b2b marketplaces in india and top marketplaces in India. Typical examples include:

• Marketplaces like top online marketplaces in India such as Amazon, Flipkart, Meesho
• Ride-sharing or delivery apps like Uber, Swiggy
• Booking platforms like Airbnb, MakeMyTrip A company that facilitates sales on behalf of others through its website and makes payouts to sellers is obliged to register and remit TDS.

Which operators do not require registration in TDS in India?

Companies that facilitate the following types of activities don’t need to register under this scheme:

• Company selling its goods/services (i.e., not facilitating third-party sales)
• Platforms that are purely for advertising, referral, or payment processing without facilitating actual sales or services
• Platform that exclusively acts as an intermediary without any payouts to participants (the sellers/service providers)
• Facilitators when their total gross receipts are below the tax threshold, or selling exempted goods/services
• Stock/commodity/power exchanges
• Payment gateway

Registration process

To register for TDS as an E-commerce Operator in India:

• Obtain Permanent Account Number (PAN)
• TAN Registration: Apply for a Tax Deduction and Collection Account Number (TAN)

What type of activity must be reported in India

E-commerce operators must report:

• Gross amount paid/credited to each e-commerce participant
• Nature of service/goods sold (categorized per seller)
• TDS amount deducted at 1% of the gross sales or services
• PAN/Aadhaar details of each seller
• Separate reporting for sellers who do not furnish PAN (in which case, TDS may be at a higher rate)

Activities include:

• Sale of physical goods on online marketplaces in India
• Provision of services (e.g., cab rides, food delivery, freelancing)
• Booking of accommodations and travel
• Subscription-based offerings, SaaS products

Activities that don’t need to be reported:

• Where a single seller who is an individual or HUF does not cross ₹ 5 lakh in gross sales/services during the financial year, the operator need not deduct TDS. This small business threshold is for residents only

Reporting deadlines for marketplaces in India

Marketplace needs to report to the Tax Authority using Form 26Q: TDS deductions are reported quarterly via Form 26Q, and to the seller about the remitted amount via Form 16A: TDS certificates (proof of tax deducted).

Form 16A due dates

Form 16A (TDS Certificate) must be issued quarterly:

Quarter	Period covered	Due date for form 16A
Q1	April–June	August 15
Q2	July–September	November 15
Q3	October–December	February 15
Q4	January–March	May 30

Additionally, TDS payment to the government must be done monthly, by the 7th of the following month (e.g., April deductions must be deposited by May 7).

Form 26Q due dates

Quarter	Period covered	Due date for filing Form 26Q
Q1	1 Apr – 30 Jun	31 July
Q2	1 Jul – 30 Sep	31 October
Q3	1 Oct – 31 Dec	31 January
Q4	1 Jan – 31 Mar	31 May

Penalties for Non-Registration or Non-Compliance

Failure to register or comply may result in:

• ₹10,000 Penalty for not obtaining TAN or quoting it incorrectly
• 1% interest per month (or part thereof) for late deduction, and 1.5% per month for late payment of deducted TDS
• Late Filing Fee: ₹200 per day until the return is filed (subject to maximum TDS amount)