Convenience fees, delivery charges and composite supply on platforms
Three line items on a checkout screen, each capable of a different tax answer.
Whether a convenience fee, a delivery charge or a packaging charge is part of the underlying supply or a separate supply depends on who supplies it and how it is charged. Where the platform charges the customer for a service it supplies, it is the platform's supply at the rate applicable to that service. Where the charge is part of the consideration for the goods or the restaurant service, it follows that supply under Section 15(2) or as a composite supply. The classification must be fixed at the checkout configuration level.
The three questions
Who supplies it? The platform, the seller, or a third party such as a delivery partner. The answer determines who is liable.
Is it charged in relation to the underlying supply? Where it is, Section 15(2) brings it into the value of that supply.
Is it a separate identifiable service the customer could decline? Where it is, it is more readily a separate supply.
For Section 9(5) supplies, the analysis is complicated because the platform is the deemed supplier of the underlying service, and a charge in relation to it may follow the same treatment.
Configuring the answer
Fix the classification in the checkout configuration and in the invoice template, so every transaction is treated the same way.
Where the platform supplies the service, invoice it as the platform's own supply at the applicable rate.
Where the charge is part of the seller's consideration, it must appear in the seller's value and the platform's reporting must match.
Document the position once, with the reasoning, and apply it across the catalogue. Inconsistency between categories is the finding an auditor makes first.
What to do on Monday
Fix the classification of every checkout charge in the system configuration and the invoice template.
Document the reasoning once and apply it across the catalogue.
Align the platform's and the seller's reporting for charges that form part of the seller's value.
Review the configuration whenever a new charge type is introduced.
This page states the general position. A reader with a specific question on their own facts may write to the GST practice at AMLEGALS.
Write to the GST practiceQuestions we are asked on this
Is a convenience fee part of the goods value?
Where the platform charges it for its own service, no. Where it is part of the consideration for the goods, yes.
Who pays on delivery charges?
Whoever supplies the delivery, and at the rate applicable to that service, unless the charge forms part of the underlying supply.
Is packaging part of the supply?
Where charged in relation to the supply, it generally forms part of the value under Section 15(2).
Does the composite supply analysis apply?
Where the elements are naturally bundled and supplied for a single price, yes, and the principal supply governs the rate.
Can different categories be treated differently?
Only where the facts differ. Unexplained inconsistency is an audit finding.
In this cluster
- GST for electronic commerce operators: the complete obligation set
- Section 52 tax collection at source: collection, credit and mismatch disputes
- Section 9(5) notified services and the platform as deemed supplier
- Cloud kitchens, food delivery and the restaurant service fiction
- Ride hailing, aggregators and the driver's registration question
- Marketplace sellers: registration, warehouse states and returns
- Coupons, cashbacks and platform funded discounts
- Cross border digital supplies and the OIDAR overlap
- Influencer, creator and affiliate income under GST
GST Insights is published by AMLEGALS for general information. Law stated as on 3 September 2026. Not advice on any particular set of facts; not an advertisement or a solicitation under Rule 36 of the Bar Council of India Rules. Readers with a question on their own facts may write to the GST practice of their own accord.