Amazon India GST Reconciliation Handbook:
MTR, GSTR-1, TCS & Audit Defence

MTR stands for Merchant Tax Report — Amazon India's monthly export of every sale's GST breakdown (CGST, SGST, IGST), TCS deduction, and net taxable amount, per order. Download from Seller Central → Reports → Tax Document Library → Merchant Tax Report (B2B and B2C have separate reports). Download monthly. Each row has the buyer's state, GSTIN if B2B, place of supply, GST rate, and amounts. Match these against your GSTR-1 filing every month.

Same total GST rate, different split based on buyer's location relative to seller. Intra-state sale (seller and buyer in same state, e.g., Karnataka → Karnataka): split 50-50 into CGST + SGST (e.g., 18% becomes 9% CGST + 9% SGST). Inter-state sale (different states, e.g., Karnataka → Tamil Nadu): the full GST goes as IGST (18% IGST). Special case: union territories use UTGST instead of SGST. Amazon's MTR report tells you which type each sale is.

Under Section 194-O of the Income Tax Act, Amazon deducts 1% TCS (Tax Collected at Source) on every sale over ₹2,500 to a non-business buyer. The TCS amount appears in your Form 26AS (downloadable from incometax.gov.in) under 'TCS deducted'. When you file ITR (typically July-October for the previous financial year), you claim this TCS the same way TDS is claimed — it offsets your final tax liability. Most sellers see the credit applied within 90 days of ITR processing, sometimes 6+ months in audit cases.

GSTR-1 is your outward supply return — every sale invoice (or invoice consolidated for B2C) filed monthly. GSTR-3B is your summary self-assessment + payment return — total sales, total ITC claimed, net GST paid. The reconciliation: total taxable value in GSTR-1 should match total taxable supplies in GSTR-3B for the same month. Mismatches trigger GSTN system flags and notices. For Amazon sellers, the MTR report is the source of truth — both filings should match the MTR's monthly totals.

When a customer returns an order and is refunded: the original sale's GST is reversed via a credit note in your GSTR-1 (filed in the month the return happens, not the original sale month). The output GST liability for that month is reduced. If you've already paid the GST in the original month, you can claim the reduction in your next month's GSTR-3B. Most CAs handle this automatically but it's a common audit-flag area — ensure your MTR refund rows are reflected as credit notes.

Generally, no — Amazon FBA sellers register GST in their home state and operate as a single GSTIN. Amazon takes care of compliance for the inter-state shipping (you generate one e-Way Bill per shipment, the rest is Amazon's logistics). However, if you store inventory in an FC in another state, that state typically requires registration as a 'place of business' under GST (Section 22 of CGST Act). Check with your CA — for most multi-state FBA sellers in India, the ISD (Input Service Distributor) model + virtual office registration in FC states is the standard pattern.

GST audits typically start with a notice asking for 5 documents: GSTR-1 + GSTR-3B for the year, MTR exports for the year, your Inventory Register, your purchase invoices (for ITC claimed), and bank statements. The auditor reconciles your filed returns against Amazon's reported sales (Amazon files its own consolidated TCS report under your GSTIN). Common red flags: GSTR-1 < MTR (under-reported sales), ITC claimed without invoice, missing return credit notes. Prepare an audit-defence pack monthly, not yearly — Seller Wolf can auto-export this.