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GST, shipping and returns are the parts of selling that new sellers skip, and then regret. This guide covers the basics in plain language. Rules change, so check current government or accountant guidance before you act.
Here is what GST for ecommerce sellers means in practice, together with shipping and returns, so you can run orders without surprises.
GST for small online sellers
Many sellers ask whether they need GST and how to get it. Moumita explains the registration process in this video:
Selling on Meesho with and without GST
GST when you buy wholesale
At WholesaleOye, prices are shown plus GST and GST bills are available, which helps if you need the bill for your accounts.
Shipping and returns
- Pack so the product survives the courier.
- Shipping at WholesaleOye is by weight slab, and free for the 1 pc sample.
- We deliver to 25000+ pincodes.
- Returns follow our easy 5-day return policy.
Cash on delivery
Wholesale B2B orders at WholesaleOye are not cash on delivery. Cash on delivery is available for dropship orders only.
Pricing and margin
Add product cost, GST, shipping, packing, platform fees and expected returns, then your profit. See our how to start a reselling business with a small budget guide for an example.
Shipping: how costs are built
| Cost element | What to know |
|---|---|
| Weight | Couriers charge by the higher of actual weight and volumetric weight |
| Volumetric weight | A common formula is length times breadth times height in cm, divided by 5000 |
| Zone | Same city, same region and distant states have different rates |
| COD charge | Extra fee on COD parcels |
| Return shipping | RTO and returns are charged separately |
At WholesaleOye, shipping on wholesale orders is by weight slab and the 1 pc sample ships free. Choose compact packing to avoid paying for empty space.
Pricing formula that includes shipping, GST and returns
- Landed cost = supplier price + GST that you cannot claim + shipping to you.
- Delivery cost = packing + shipping to customer + COD fee if any.
- Risk cost = returns and RTO allowance.
- Platform cost = fees, ads and payment charges.
- Selling price = all of the above plus your profit.
See worked examples in the reselling profit guide and the dropshipping guide.
Returns policy basics
- Write a short, clear policy: time limit, condition of product and who pays shipping.
- Inspect returned items, restock if fine, record the reason.
- Fix repeated causes at source, see reducing returns and RTO.
- WholesaleOye has an easy 5-day return policy. Check the policy page for details.
Cash on delivery
COD raises conversion for new buyers but also RTO. Confirm each order and consider prepaid incentives. At WholesaleOye COD is available for dropship orders only.
GST essentials in one place
- Marketplace sellers of goods generally need to register, with a small-seller exemption under conditions.
- The platform collects tax at source from registered sellers’ sales.
- Registered sellers can claim input credit on purchases, subject to the rules.
Details are in GST registration for online sellers and sell on Meesho without GST.
Packing guide by product type
| Product type | Packing approach |
|---|---|
| Hard, sturdy items (tools, organisers) | Poly bag inside a corrugated box, tape on all seams |
| Fragile items (glass, ceramics) | Bubble wrap, filler paper, double box if needed, “fragile” label |
| Liquids and creams | Leak-proof caps, inner seal, plastic bag around the bottle, upright orientation |
| Electronics and accessories | Original box, bubble wrap, moisture protection |
| Soft goods | Sealed poly bag to protect from moisture and dirt |
How to choose a courier
| Check | Why |
|---|---|
| Pincode coverage | Avoid undeliverable areas |
| Delivery success rate by region | Lowers RTO |
| Rates by weight and zone | Controls cost |
| COD remittance schedule | Cash flow |
| Pickup reliability | Dispatch time |
| Tracking and support | Customer experience |
Compare at least two couriers on the same set of orders for a month, then keep the better one for each region.
Shipping price strategies for your customers
| Strategy | How it works | Best for |
|---|---|---|
| Actual shipping charged | Charge what the courier charges | Heavier or variable products |
| Flat rate | Same charge for every order | Light, similar products |
| Free above a threshold | Free delivery above a set order value | Raising order value |
| Free shipping built into price | Price includes shipping | Marketplaces and simple pricing |
Returns workflow in six steps
- Customer reports the problem with photos.
- You check the reason against your policy.
- Approve, offer replacement or refund, or explain why not.
- Arrange pickup or ask the customer to ship back, as your policy states.
- Inspect the returned product and restock if fine.
- Record the reason and fix the cause.
What a GST invoice usually contains
- Your name, address and GSTIN.
- Invoice number and date.
- Customer’s name and address, and GSTIN for business buyers.
- Description and HSN code of goods, quantity and value.
- Rate and amount of GST charged.
- Total amount and signature or digital signature.
If you are not registered, you issue a bill of supply or a simple bill without charging GST. Your accountant can confirm the correct format.
Records you should keep
| Record | Why |
|---|---|
| Purchase bills | Proof of cost and input credit |
| Sales invoices or bills | Proof of sales and tax |
| Courier receipts | Proof of dispatch and claims |
| Return records | Refunds and disputes |
| Bank and UPI statements | Matching payments |
A monthly compliance checklist
- Match sales records with marketplace and bank statements.
- Check TCS and payouts from marketplaces.
- File GST returns on time if you are registered.
- Pay any tax due before the due date.
- Review returns, RTO and shipping costs.
- Back up your spreadsheets and bills.
Income tax: a short note
Profit from your online business is income and must be reported. Keep your records tidy, and ask an accountant which return form and which method of computing profit applies to you. This guide is general information, not tax advice.
Common questions answered in detail
Should I include shipping in my price or charge it separately?
On marketplaces, shipping is usually built into the price or deducted from payouts, so price with shipping in mind. On your own channels, flat or free-above-threshold shipping is easy for customers to understand. Test both and see which gives higher conversion and profit.
How do I avoid losing money on heavy or bulky items?
Check volumetric weight before you list. If shipping is more than a third of the selling price, the product is probably not a good fit unless the margin is large.
What if the customer says the parcel is damaged?
Ask for photos of the parcel and the product. Check your packing photos. Offer a replacement or refund as your policy states, and file a courier claim if you have insurance or the courier accepts claims.
Do I need to charge GST on shipping?
Treatment depends on whether shipping is part of a composite supply and on your registration. Ask your accountant how to show shipping on invoices.
Can I keep selling if I cross the GST limit?
You must register once required. Selling beyond the limit without registration can lead to tax demands and penalties, so check your turnover each month.
A one-page checklist before each dispatch
- Order confirmed and paid, or COD confirmed.
- Product tested and matches the listing.
- Packed to survive a drop, sealed and labelled.
- Bill or invoice included or sent.
- Courier booked and tracking shared with the buyer.
- Record updated in your sheet.
Shipping and returns terms: glossary
| Term | Meaning |
|---|---|
| Volumetric weight | Weight calculated from the parcel’s size |
| NDR | Non-delivery report from the courier |
| RTO | Return to origin |
| Weight slab | A weight range with a fixed shipping charge |
| Remittance | The courier’s payment of COD cash to you |
| Input tax credit | GST paid on purchases that a registered seller may offset against tax due |
Frequently asked questions
Do I get a GST bill when I buy from WholesaleOye?
Yes, GST bills are available. Prices are shown plus GST.
Is cash on delivery available on wholesale orders?
No. Cash on delivery is available for dropship orders only.
Is shipping free?
Shipping is free for the 1 pc sample. Other orders are charged by weight slab.
What is the return policy?
We have an easy 5-day return policy.
How do I calculate shipping cost for my product?
Weigh the packed parcel, check volumetric weight and compare courier rates by zone. Add COD and return costs to your price.
Who pays for return shipping?
It depends on your policy and platform rules. Make it clear before the sale.
Do I need to give GST bills?
If you are registered you must issue tax invoices. WholesaleOye provides GST bills to buyers.
Sources and further reading
- Amazon Shipping: what is RTO and how to reduce it
- GST Council: Notification 34/2023-Central Tax
- ClearTax: GST registration for e-commerce
GST registration for ecommerce and RTO in ecommerce: what to check first
Whether GST registration for ecommerce is compulsory for you depends on your turnover, where you sell and the platform rules, so confirm it with your accountant and read GST registration for online sellers. RTO in ecommerce means a parcel that returns to the seller undelivered, which costs shipping twice. Learn the fixes in how to reduce returns and RTO.
More guides in this series
- How To Start An Online Business In India
- How To Grow An Ecommerce Business In India
- How To Sell On Amazon, Flipkart And Meesho
- How To Source Wholesale Products In India
Written by WholesaleOye Team
WholesaleOye is an online wholesale market for sellers, shop owners and new resellers in India. Our mission is to make wholesale simple and low risk: buy in small quantity, start with a single sample piece, and grow as your customers re-order. Our vision is to be the place small businesses trust to source direct from importers and manufacturers at the best price, with GST bills, doorstep delivery to 25000+ pincodes and an easy 5-day return policy.
