GST on shipping charges in e-commerce
Charge for delivery? GST usually applies — and at the rate of what you're selling. Here's the rule, simply.
Shipping charges you recover from customers are part of the value of supply, so GST generally applies to them. The rate usually follows the principal goods (the composite-supply rule), not a separate logistics rate.
The composite supply principle
When goods and their delivery are sold together for a single price, it's a composite supply. The whole amount — product plus shipping — is taxed at the product's GST rate. So shipping on an 18% product is taxed at 18%.
On marketplaces
Marketplaces typically build delivery into the order value and apply GST accordingly, then report it in your settlement. Reconcile this against your MTR report so your returns match.
| Scenario | GST on shipping |
|---|---|
| Free shipping (built into price) | Already in the taxed price |
| Separate shipping charge | Taxed at the product's rate |
| Mixed-rate cart | Apportioned across items |
Practical tips
- Show shipping clearly on the invoice and tax it with the goods.
- For mixed-rate carts, apportion shipping reasonably.
- Keep invoice values consistent with marketplace settlement data.
Need this done for you?
Our in-house CA & CS team set up your virtual office, VPOB and GST end to end — ₹19,188/yr.
💬 Talk to our team View plans →Frequently asked questions
Is GST charged on delivery fees?
Yes, generally. Delivery recovered from the customer is part of the value of supply and taxed, usually at the product's GST rate.
What rate applies to shipping?
Under the composite-supply rule, shipping follows the principal goods' rate — e.g. 18% shipping on an 18% product.
How do marketplaces handle shipping GST?
They typically include delivery in the order value and apply GST, reporting it in your settlement for reconciliation.
Get a free callback
Leave your details and our in-house CA & CS team will call you back — usually within a few business hours. No spam, no obligation.
- ✓ Free consultation on VPOB, APOB & GST
- ✓ Transparent pricing ₹19,188/yr
- ✓ Same-day document pack on most plans