Create an Amazon receivable ledger under Sundry Debtors, then post sales and returns against it from your sales and returns reports. Book commission, fixed closing, shipping and other fees as expenses with input GST, as per Amazon's fee invoices. Record TCS and TDS as receivable ledgers, and book the bank receipt against the same ledger. A zero balance per settlement means it is reconciled.
Set up ledgers before you post anything
Most Tally problems with marketplaces start with a messy ledger structure. Decide the ledgers first, then post in a repeatable pattern every settlement cycle.
- Amazon Seller Receivable under Sundry Debtors. This is the single party ledger that every entry touches.
- Sales - Amazon under Sales Accounts, with output GST ledgers as required by your invoices.
- Sales Returns - Amazon under Sales Accounts (or as a contra, per your accountant's preference).
- Amazon Fees expense ledgers under Indirect Expenses. Keep commission, fixed closing fee, shipping or fulfilment fee, and other charges separate if you want to check them against your terms.
- Input GST ledgers for GST charged on fees.
- TCS Receivable (GST) and TDS Receivable (Section 194-O) under Current Assets.
- Amazon Reserve / Holds for amounts withheld and released later.
Confirm the ledger and tax treatment with your chartered accountant. Do not copy another seller's structure blindly.
Choose how detailed your sales entries will be
You have two practical options in Tally Prime.
- Invoice-level: one sales voucher per order, imported from the Amazon tax invoice or order report. This gives the cleanest audit trail but is heavy for high volumes.
- Summary-level: one sales voucher per day, week or settlement period, split by GST rate and state. This is lighter, but you must keep the supporting report and be able to tie it back to order data.
Whichever you pick, stay consistent. Your GST return, your books and your settlement report should all be explainable from the same source file.
Book sales and returns
Use the Amazon sales or tax invoice report for the period. Post a sales voucher debiting Amazon Seller Receivable and crediting Sales - Amazon and the output GST ledgers, split as per your invoices.
For returns, post a credit note (or journal, depending on your configuration) debiting Sales Returns - Amazon with the GST reversal and crediting Amazon Seller Receivable. Book returns in the period the credit note or return is recorded, and keep the reference to the original order so that disputed or missing returns can be traced later.
The same pattern works for Flipkart. Create a separate receivable ledger for each marketplace so balances do not mix.
Book Amazon fees and charges
Amazon's fee lines appear in the settlement or payment report, and the corresponding invoices are available in Seller Central. Book fees from those documents, not from the net payout figure.
- Debit the relevant fee expense ledger with the taxable value.
- Debit Input GST ledgers with the GST charged on the fee, if you are eligible to claim it. Confirm eligibility with your tax adviser.
- Credit Amazon Seller Receivable with the total.
Do not hard-code fee rates in your process. Commission, closing fees and shipping charges depend on your category, price band and agreed terms. Check them in your seller agreement or the current rate card in Seller Central, and confirm the latest version before relying on it.
Record tax deductions and the bank receipt
Amazon, as an e-commerce operator, may deduct TCS under GST and TDS under the Income-tax Act from your payout. The amounts appear in the settlement report. Do not guess the rates; check the current rules with your tax adviser and the government notifications.
- Debit TCS Receivable and TDS Receivable, credit Amazon Seller Receivable.
- Match TCS to your GST portal credit ledger and TDS to Form 26AS or AIS before claiming.
- When the money lands, post a receipt: debit Bank, credit Amazon Seller Receivable.
- Post holds and releases to Amazon Reserve / Holds so they do not distort the receivable.
Reconcile each settlement to zero
After posting, the Amazon receivable ledger should clear for each settlement. If it does not, the gap is usually a missing return, a fee you did not book, a reserve, a reimbursement or a timing difference between order date and settlement date.
Run the check every cycle rather than at year-end. Compare sales and return totals with the order reports, fees with your agreed terms, and the net payout with the bank credit. If volumes make this slow in Excel, MarketplaceMetrics by Fundle can reconcile sales and settlements, check fees against agreed terms and track returns and recovery cases; Myntra Excel reports are reviewed today and other marketplaces are a scoping discussion.
Worked example
Illustrative example only. Figures are made up for explanation and are not real rates or results. Amounts are shown inclusive of output GST on sales; your vouchers should split tax as per your invoices.
| Entry | Debit | Credit | ₹ (illustrative) |
|---|---|---|---|
| Sales for the period | Amazon Seller Receivable | Sales - Amazon (and output GST) | 1,00,000 |
| Customer returns | Sales Returns - Amazon (and GST reversal) | Amazon Seller Receivable | 10,000 |
| Fees: ₹12,000 plus GST ₹2,000 | Amazon Fees; Input GST | Amazon Seller Receivable | 14,000 |
| TCS ₹900 and TDS ₹800 | TCS Receivable; TDS Receivable | Amazon Seller Receivable | 1,700 |
| Bank receipt | Bank | Amazon Seller Receivable | 74,300 |
Check: 1,00,000 − 10,000 − 14,000 − 1,700 − 74,300 = 0. The receivable clears. If the bank credit were ₹70,000 instead, the ₹4,300 gap would be your list of items to investigate: a hold, an unbooked fee or a missing return.
Questions and answers
Should I book Amazon sales invoice by invoice or in summary?
Either works if you stay consistent and can tie totals back to Amazon's order and tax invoice reports. Invoice-level gives a better audit trail but takes more effort. Summary-level by day or settlement period is lighter, provided GST rate and state splits are correct.
Can I book only the net settlement amount as sales?
It is not advisable. Booking net payout hides gross sales, returns, fees and tax deductions, which can distort your GST reporting, margins and fee checks. Book gross sales, returns, fees and deductions separately, and let the bank receipt clear the receivable.
How do I treat TCS and TDS deducted by Amazon?
Record them as receivable ledgers, not expenses, and reduce the Amazon receivable. Match TCS with your GST portal credit ledger and TDS with Form 26AS or AIS. Confirm current rates and claim rules with your tax adviser.
Does the same process work for Flipkart settlements?
Broadly yes. Create a separate receivable ledger, post sales, returns, fees and tax deductions against it, and book the bank receipt. Fee names, report formats and settlement timing differ, so map each Flipkart settlement report to your ledgers before posting.