How to calculate GST as an online seller
GST is charged on the value of what you sell. You either start from a value before GST and add tax, or start from a price that already includes GST and take the tax out. Rates below follow the changes that took effect on 22 September 2025.
How to add GST
Use this when you know your price or value before tax.
GST amount
Amount before GST × GST rate ÷ 100
Total including GST
Amount before GST + GST amount
₹1,000 at 18%: ₹180.00 GST, ₹1,180.00 total.
How to remove GST
Use this when you know the price the customer pays. Marketplace selling prices usually include GST.
Value before GST
Price including GST ÷ (1 + GST rate ÷ 100)
GST amount
Price including GST − value before GST
₹1,180 at 18%: ₹1,180 ÷ 1.18 = ₹1,000.00 before GST, ₹180.00 GST.
A common mistake is to take 18% off the price. On ₹1,180 that gives ₹212.40 of GST, which is ₹32.40 too much. Always divide by 1 plus the rate.
CGST, SGST and IGST
GST is split between the centre and the states. Which parts you charge depends on whether the customer is in your state.
| Supply | What you charge | On an 18% sale |
|---|---|---|
| Within your state | CGST and SGST, half the rate each | 9% CGST + 9% SGST |
| To another state | IGST at the full rate | 18% IGST |
In a union territory without its own legislature, UTGST takes the place of SGST. The total rate is the same either way. Only who receives the tax changes.
GST slabs after 22 September 2025
The rate changes came in through CBIC Notification No. 9/2025-Central Tax (Rate) dated 17 September 2025. Most goods now sit in two main slabs, 5% and 18%.
| Rate | Covers | Examples |
|---|---|---|
| 0% | Nil-rated goods | UHT milk, pre-packaged paneer, roti and chapati, pencils, erasers and exercise books |
| 0.25% | Rough precious and semi-precious stones | Check your HSN code |
| 3% | Precious metals | Check your HSN code |
| 5% | Main lower slab | Apparel up to ₹2,500 per piece, footwear up to ₹2,500 per pair, bicycles, biscuits, chocolates and ice cream |
| 18% | Main standard slab | Apparel above ₹2,500 per piece, small cars, two-wheelers up to 350cc, cement, marketplace fees |
| 40% | Luxury and sin goods | Cigarettes and other tobacco products, large cars |
Examples from the PIB factsheet of 20 September 2025. Check the rate for your own HSN code.
The ₹2,500 rule for apparel
Apparel under chapters 61 and 62 is taxed at 5% when the sale value per piece is ₹2,500 or less, and 18% above that. The sale value is the value before GST. Before 22 September 2025, the limit was ₹1,000, with 5% up to it and 12% above.
So the highest price including GST that is clearly in the 5% slab is ₹2,500 + 5% = ₹2,625. Above that, prices up to ₹2,950 fall in a grey zone. Taxed at 5%, their value before GST is above ₹2,500, which calls for 18%. Taxed at 18%, their value before GST is ₹2,500 or less, which calls for 5%. This calculator uses 18% for these prices, the conservative choice, and flags them so you can confirm with your CA.
Worked example: ₹2,625 or ₹2,950
A kurta sold on a marketplace. Here is what the seller keeps at three prices, taxed at the slab the calculator uses.
| Price including GST | GST slab | GST | You keep before GST |
|---|---|---|---|
| ₹2,625 | 5% | ₹125.00 | ₹2,500.00 |
| ₹2,800 | 18% (grey zone) | ₹427.12 | ₹2,372.88 |
| ₹2,950 | 18% (grey zone) | ₹450.00 | ₹2,500.00 |
At ₹2,950 the customer pays ₹325 more than at ₹2,625, and you keep the same ₹2,500. At ₹2,800 you keep ₹127.12 less. If a piece is priced anywhere from just above ₹2,625 to ₹2,950, pricing it at ₹2,625 keeps it in 5% and leaves you at least as much.
Footwear has a similar limit: 5% on footwear up to ₹2,500 per pair and 18% above. The apparel helper in this calculator does not cover footwear, so check those slabs for your HSN code.
GST on marketplace fees and TCS
Marketplace fees, such as referral, closing and shipping fees, carry 18% GST. If you are GST-registered, you claim this back as input tax credit, so it is not a cost. The Amazon fee calculator shows it separately for this reason.
E-commerce operators also collect 0.5% GST TCS from registered sellers on the net taxable value of their sales, and hold it back from payouts. You claim it against your GST liability. It reduces the cash you receive, not your profit.
Ads work the same way: GST on ad spend is claimable, so compare ad spend before GST with your margin. The break-even ROAS calculator shows the most you can spend.
Free PDFGet the Amazon India Playbook10 chapters on fees, listings, ads, ranking and inventory, with a 90-day plan.Frequently asked questions
How do I add GST to a price?
Multiply the amount before GST by the rate, then add it back. ₹1,000 at 18% has ₹180.00 of GST, so the total is ₹1,180.00. At 5%, the same ₹1,000 has ₹50 of GST and a total of ₹1,050.
How do I remove GST from a price that includes it?
Divide the price by 1 plus the rate. ₹1,180 including 18% GST is ₹1,180 ÷ 1.18 = ₹1,000.00 before GST, with ₹180.00 of GST. Do not take 18% off the price: that gives ₹212.40, which is too much.
What are the GST rates from 22 September 2025?
The main slabs are 5% and 18%. Luxury and sin goods are taxed at 40%, precious metals at 3%, rough precious and semi-precious stones at 0.25%, and nil-rated goods at 0%. The changes came in through CBIC Notification No. 9/2025-Central Tax (Rate) dated 17 September 2025.
What is the GST rate on clothes sold online?
Apparel under chapters 61 and 62 is taxed at 5% when the sale value per piece is ₹2,500 or less, and 18% above that. The sale value is the value before GST. Before 22 September 2025, the limit was ₹1,000, with 5% up to it and 12% above.
Why price a garment at ₹2,625 instead of ₹2,950?
Both leave you ₹2,500 before GST. At ₹2,625 the piece is taxed at 5%, so GST is ₹125. At ₹2,950 it is taxed at 18%, so GST is ₹450. The customer pays ₹325 more and you keep nothing extra. Any price between the two leaves you less than ₹2,500 if it is taxed at 18%.
When do I charge IGST instead of CGST and SGST?
Charge CGST and SGST, half the rate each, when you supply to a customer in the same state as you. Charge IGST at the full rate when the customer is in another state. An 18% sale is 9% CGST plus 9% SGST within your state, or 18% IGST to another state.
Do marketplaces charge GST on their fees?
Yes. Marketplace fees carry 18% GST. If you are GST-registered, you claim it back as input tax credit against the GST you collect on sales, so it is not a cost.
What is GST TCS on marketplace payouts?
E-commerce operators such as Amazon, Flipkart and Meesho collect 0.5% GST TCS from registered sellers and hold it back from payouts. You claim it against your GST liability, so it reduces the cash you receive, not your profit.