How to Set Up GST on Your Online Store in India: Step-by-Step
GST anxiety is real. Every week, sellers ask us some version of the same question: "Do I have to register for GST before I go online?" Some have been putting off their website for months because they're afraid of getting the tax part wrong.
Here's the straightforward answer: GST compliance for a small online store in India is not as complicated as it looks. Most small sellers don't need to register immediately. Those who do have a clear process to follow. And once you're registered, a good store platform generates compliant invoices automatically on every order.
This guide walks you through all of it — no CA jargon, no assumptions about your accounting background.
TL;DR
- GST registration is mandatory only above ₹20 lakh annual turnover (₹10 lakh for special category states)
- Ecommerce sellers have specific rules: some platforms require GSTIN regardless of turnover
- Every product needs an HSN code; intra-state sales use CGST+SGST, inter-state uses IGST
- A compliant GST invoice has nine required fields — your store platform should generate these automatically
- The Composition Scheme is an option for small local-only retailers below ₹1.5 crore turnover
- Keep digital records for at least six years; GST returns are filed monthly or quarterly
Step 1: Do You Actually Need to Register for GST?
GST registration is only mandatory after you cross the turnover threshold — and that threshold depends on where your business is registered.
As of the GST Council's rules under the CGST Act, 2017 (gst.gov.in, retrieved June 2026):
| Business type | Mandatory registration threshold |
|---|---|
| Regular businesses (most states) | ₹20 lakh annual turnover |
| Special category states | ₹10 lakh annual turnover |
| Ecommerce operators | Mandatory regardless of turnover |
Special category states currently include Manipur, Mizoram, Nagaland, Tripura, Meghalaya, Arunachal Pradesh, Sikkim, and Uttarakhand. If your business is registered in one of these states, your threshold is ₹10 lakh.
The ecommerce complication: If you sell through an ecommerce operator (like Amazon or Flipkart), you need GST registration regardless of turnover. However, if you sell through your own website — which you fully own and operate — the standard ₹20 lakh threshold applies.
[ORIGINAL DATA] In our experience at Cresivox, the most common confusion among new sellers is assuming that having an online store automatically means mandatory GST. It doesn't. Your own website is not an "ecommerce operator" under GST law. You're the operator. The ₹20 lakh threshold still applies.
Even if you're below the threshold, voluntary registration can be smart. It lets you claim input tax credit on your business purchases — the GST you pay on stock, packaging, and other supplies. For sellers buying from registered wholesalers, this can reduce effective costs meaningfully.
Step 2: How to Register on the GST Portal
If you've crossed the threshold — or want to register voluntarily — the process is online and takes 15–20 working days from submission.
You'll need:
- PAN card (of the business or proprietor)
- Aadhaar card
- Bank account statement or cancelled cheque
- Business address proof (electricity bill, rental agreement)
- Photograph of the proprietor
- Your business details (trade name, category of goods/services)
The process:
- Go to gst.gov.in and click "Register Now" under Taxpayer
- Complete Part A: your PAN, mobile number, email — you'll get a TRN (Temporary Reference Number) by SMS
- Complete Part B using the TRN: enter all business details, upload documents
- Submit with DSC (digital signature) or Aadhaar-based OTP e-signature
- An ARN (Application Reference Number) is generated — track progress on the portal
- GST officer reviews and approves; your GSTIN is issued
Your GSTIN is a 15-digit number. The first two digits are your state code. The next 10 are your PAN. Keep it ready — you'll add it to your store settings.
Step 3: Find the Right HSN Code for Your Products
HSN stands for Harmonised System of Nomenclature. It's an internationally standardised coding system for classifying goods. Under GST, every product on your invoice must carry the correct HSN code.
Getting it wrong doesn't usually cause legal trouble immediately, but it does cause problems during GST return filing and can trigger notices.
How to Find Your Product's HSN Code
The easiest method: use the official GST HSN search at gst.gov.in/services/searchhsnsac. Type a keyword and it returns the matching codes and tax rates.
Common retail categories and their chapters:
| Product category | HSN Chapter | Typical GST rate |
|---|---|---|
| Cotton garments (kurta, salwar, saree) | Chapter 61/62 | 5% below ₹1,000; 12% above |
| Packaged food, namkeen, snacks | Chapter 19/21 | 5–12% depending on product |
| Footwear | Chapter 64 | 5% below ₹1,000; 18% above |
| Electronics (phones, accessories) | Chapter 85 | 18% |
| Cosmetics and personal care | Chapter 33 | 18% |
| Jewellery (not gold/silver) | Chapter 71 | 3% for gold; 18% for imitation |
| Puja items, agarbatti | Chapter 33/34 | 5–12% |
| Grocery staples (atta, rice, pulses) | Chapter 10/11 | 0% (exempt or nil-rated) |
How many digits do you need? For businesses with turnover up to ₹5 crore, four-digit HSN is sufficient on invoices. Above ₹5 crore, six-digit HSN is required. Below ₹1.5 crore (Composition Scheme), HSN isn't required on invoices at all.
Step 4: CGST/SGST vs IGST — Which Applies to Your Orders?
This is the part that confuses most online sellers. The logic is actually simple once you understand the one-line rule:
Same state = CGST + SGST. Different states = IGST.
Intra-State Sales (CGST + SGST)
When your business is in Maharashtra and you sell to a customer also in Maharashtra, the tax is split equally between central and state governments.
On a product with 12% GST, the invoice shows:
- CGST: 6%
- SGST: 6%
- Total GST: 12%
Inter-State Sales (IGST)
When your business is in Maharashtra and you sell to a customer in Karnataka (or any other state), all the tax goes to the central government as IGST.
On the same 12% GST product:
- IGST: 12%
- No CGST, no SGST shown
Your store platform should calculate and apply this automatically based on the customer's delivery address. You don't need to manually decide — the system detects the state from the pincode and applies the right tax type.
[CHART: Split diagram - "GST flow on a ₹1,000 product at 18%" - Intra-state: CGST ₹90 to Central Govt + SGST ₹90 to State Govt; Inter-state: IGST ₹180 to Central Govt - Source: GST Council, gst.gov.in]
Step 5: Configure GST in Your Online Store
Once you have your GSTIN and know your HSN codes and tax rates, adding GST to your store takes about 10 minutes.
Here's what to configure:
1. Enter Your GSTIN
In your store settings under "Tax" or "Business Details," enter your 15-digit GSTIN. This populates automatically on every invoice your store generates.
2. Set Tax Rates Per Product
For each product, assign:
- The HSN code
- The applicable GST rate (0%, 5%, 12%, 18%, or 28%)
The platform calculates CGST/SGST vs IGST automatically based on customer location.
3. Decide: Tax Inclusive or Exclusive?
Tax inclusive: The price shown to the customer already includes GST. ₹1,000 for a kurta includes the tax. Cleaner for consumer-facing stores.
Tax exclusive: GST is added at checkout. Customer sees "₹940 + ₹60 GST = ₹1,000." Standard for B2B stores where the buyer wants to see the tax amount separately for their own credit claims.
For retail (B2C) stores, tax-inclusive pricing is simpler and what most Indian shoppers expect. For wholesale, show it exclusive.
4. Set Up B2B Invoice Option
If you have business customers who want to enter their GSTIN at checkout and receive a B2B invoice (so they can claim input tax credit), enable the "GSTIN at checkout" option. The invoice format switches automatically when a buyer enters their GSTIN.
[INTERNAL-LINK: setting up a wholesale store in India → /en/blog/wholesale-website-india-guide]
Step 6: Auto-Generated GST Invoices — What They Must Include
A GST invoice is a legal document. Missing any required field makes it non-compliant, which can cause problems for both you and your B2B customers.
Under the CGST Act, 2017 Rule 46, a GST invoice must include (gst.gov.in, retrieved June 2026):
| Required field | Example |
|---|---|
| Supplier GSTIN | 27ABCDE1234F1Z5 |
| Supplier name and address | Sharma Textiles, 45 Cloth Market, Mumbai 400003 |
| Invoice number (unique, sequential) | INV-2026-001 |
| Invoice date | 24 June 2026 |
| Buyer name and address | Customer name + delivery address |
| Buyer GSTIN (for B2B only) | If applicable |
| HSN code for each item | 6106 (for kurtas) |
| Description of goods | Cotton Straight Kurta, White, Size M |
| Quantity | 2 pieces |
| Unit price (taxable value) | ₹450 per piece |
| Total taxable value | ₹900 |
| GST rate | 5% |
| CGST/SGST or IGST amount | CGST ₹22.50 + SGST ₹22.50 |
| Total invoice value | ₹945 |
A store platform that generates GST invoices automatically fills every one of these fields from the order data. You don't write these by hand. The invoice generates when the order is placed, and the customer receives it digitally.
[IMAGE: Sample GST-compliant invoice template showing all required fields labelled - search terms: GST invoice template India retail]
The Composition Scheme: Should Small Sellers Consider It?
The Composition Scheme is a simplified GST option for small businesses with annual turnover below ₹1.5 crore (for traders and manufacturers) or ₹50 lakh (for service providers), per the GST Council rules (gst.gov.in, retrieved June 2026).
Under the scheme, you pay GST at a flat low rate instead of the standard slab rates:
- Traders (goods): 1% of turnover
- Restaurants: 5% of turnover
- Manufacturers: 1% of turnover
The advantages:
- Simpler compliance: one quarterly return instead of monthly returns
- Lower effective tax burden for many small sellers
- No detailed HSN invoice required
The limitations — and they matter for online sellers:
- You cannot make inter-state sales. If you want to sell to customers in other states, the Composition Scheme disqualifies you.
- You cannot claim input tax credit. The GST you pay on your stock purchases is a cost, not a credit.
- You cannot issue tax invoices to B2B buyers. Your buyers can't claim credit from your invoices.
For a kirana shop selling only in its local area, the Composition Scheme is worth considering. For any online store that ships across India, it's almost always the wrong choice — the inter-state restriction alone rules it out.
Step 7: What Records to Keep and for How Long
GST compliance isn't just about filing returns. It's about keeping records that support your filings if you're ever audited.
Under the CGST Act, Section 36, businesses must maintain records for 72 months (six years) from the due date of the annual return (gst.gov.in/services/gst-acts, retrieved June 2026).
What to keep:
- All sales invoices (auto-generated by your store platform — make sure you can export them)
- All purchase invoices from your suppliers
- Inventory records (opening and closing stock per month)
- Bank statements showing tax payments
- GST return filings (GSTR-1, GSTR-3B)
- E-way bills for goods transported above ₹50,000 in value
Practical approach for online sellers: Your store platform should let you export all order invoices as a batch PDF or CSV by month. Do this monthly and save to Google Drive or a hard drive. Send your CA the monthly export for GSTR-1 filing. Done.
Most good store platforms also let you download an HSN-wise sales summary directly — which is exactly what you need for GSTR-1's HSN section.
FAQs About GST for Online Stores in India
Do I need GST to sell online in India?
Not always. If your annual turnover is below ₹20 lakh (₹10 lakh for special category states), GST registration is not mandatory on your own website. However, if you sell on third-party ecommerce platforms, those operators require GSTIN regardless of turnover. When in doubt, consult a CA to check which rule applies to your specific setup.
What is an HSN code and how do I find the right one?
HSN (Harmonised System of Nomenclature) codes classify goods under GST. Every invoice must include the correct code for each product. Find yours using the search tool at gst.gov.in. Common ones: cotton garments are Chapter 61 or 62, packaged snacks are Chapter 19 or 21, electronics are Chapter 85. Four-digit codes are sufficient for turnover below ₹5 crore.
What is the difference between CGST, SGST, and IGST?
CGST and SGST apply when the seller and buyer are in the same state. The GST rate splits equally between them. IGST applies when the seller and buyer are in different states. Your store platform detects this automatically from the delivery pincode and applies the right tax type on every order invoice.
What details must appear on a GST invoice from an online store?
A valid GST invoice needs: your GSTIN, invoice number and date, buyer's name and address, HSN codes, product descriptions, quantities, taxable value, GST rate, and CGST/SGST or IGST amounts. A good store platform auto-generates all of this on each order. You should never need to write a GST invoice by hand for your online sales.
What is the GST Composition Scheme and is it right for small online sellers?
The Composition Scheme allows businesses below ₹1.5 crore turnover to pay GST at a flat 1% (for traders) instead of standard slab rates, with simpler quarterly returns. The major catch: you cannot sell inter-state. For online stores shipping across India, this disqualifies you from the scheme. It's mainly suitable for local retail shops selling only in their own state.
Your Next Step
GST compliance for an online store comes down to three things: know your threshold, get the right platform to auto-generate invoices, and export your records monthly for your CA.
The part most sellers dread — the invoicing — is the part that a good store platform handles automatically. You set your GSTIN and HSN codes once. Every order after that produces a compliant invoice without you touching it.
We've helped 41,000+ sellers get their stores GST-ready. Most do it in one afternoon.
Set up your GST-compliant online store →
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