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A seller using a marketplace, a payment gateway and COD cannot tell which bank credit came from which channel or why the deductions differ.
Classify each payout by payer type, apply that type's expected deductions and tax lines, and match it with the right key: order ID, payout ID and UTR, or AWB number.
Separate receivable ledgers per marketplace, gateway and courier, plus the settlement report, payout report and remittance file for each.
Each bank credit tagged to its channel, its deductions explained by type, and its receivable cleared using the channel's own match key.
All three move money from your customers to your bank, but they work differently. A marketplace pays after delivery, net of its fees and of the taxes it must deduct or collect. A payment gateway pays on a fixed cycle, net of its fee (the merchant discount rate, or MDR) and GST on it. A courier remits COD cash after its own cycle, net of its charges. Keep them apart in your books and each becomes easy to check.
How do the three compare?
| Marketplace payout | Gateway payout | COD remittance | |
|---|---|---|---|
| Payer | Amazon, Flipkart, Meesho and others | Razorpay, PayU, Cashfree and others | Courier or shipping aggregator |
| Trigger | Order delivered and past its payment eligibility date | Payment captured, then the settlement cycle | Parcel delivered, cash collected, cycle closes |
| Typical deductions | Commission, fixed and shipping fees, GST on fees, returns | MDR, GST on MDR, refunds, chargebacks | COD fee, freight, RTO charges |
| Report you receive | Settlement report | Settlement or payout report | Remittance file |
| Tax lines | TDS under Section 194O and GST TCS under Section 52 | None of these by default | None of these by default |
| Bank narration | Marketplace name and reference | Gateway name and payout reference | Courier or aggregator name |
Who deducts TDS and TCS on each?
A marketplace is an e-commerce operator. It deducts income-tax TDS at 0.1 percent of gross sales under Section 194O, from 1 October 2024, which is Section 393 of the Income-tax Act 2025 from 1 April 2026. It also collects GST TCS at 0.5 percent of net taxable value under Section 52 of the CGST Act, from 10 July 2024.
A payment gateway that only processes payments on your own website is a payment aggregator, not an operator, so its payout does not carry these lines by default. That is why your TDS credit statement (Form 26AS, or Form 168 from tax year 2026-27) shows marketplace TDS, not gateway TDS.
A courier collecting COD is your collection agent. It does not deduct these taxes on the sale.
What should I use as the match key for each?
- Marketplace: order ID. Every line in the settlement report ties to an order.
- Gateway: payout ID to find the report, then UTR to find the bank credit, then payment or order ID inside the report.
- Courier: AWB number, the courier’s parcel number.
Using the wrong key is the most common reason a reconciliation stalls.
A worked example
One product with a ₹2,000 sale value, sold three ways. All fees are illustrative, and GST on the sale is left out to keep it simple.
Through a marketplace. Commission 10 percent ₹200, fixed and shipping fees ₹100, GST at 18 percent on ₹300 of fees ₹54, TDS at 0.1 percent ₹2, TCS at 0.5 percent ₹10. Bank credit: ₹2,000 − ₹200 − ₹100 − ₹54 − ₹2 − ₹10 = ₹1,634.
Through your own site with a gateway. MDR at an illustrative 2 percent ₹40, GST at 18 percent on MDR ₹7.20. Bank credit: ₹2,000 − ₹40 − ₹7.20 = ₹1,952.80.
As COD. COD fee ₹35 and freight ₹55, total ₹90. Bank credit: ₹2,000 − ₹90 = ₹1,910.
The same sale produces three different credits, on three different days, from three different payers.
How should I set up my books?
Create one receivable ledger per payer: Amazon Receivable, Flipkart Receivable, Razorpay Receivable, Courier A Receivable, and so on. Book sales against the right one, book each payout against it, and age what remains. Keep TDS Receivable and GST TCS Receivable as separate ledgers for the marketplace tax lines.
What to read next
Once the three are separated, learn how to record a marketplace settlement in your books. For the tax test see the Section 194O operator versus participant guide, and for gateways see Razorpay settlement reconciliation. Multi-channel settlement reconciliation is on the roadmap for Terra Insight’s payment gateway reconciliation work.
Content authored by practitioners with experience at Amazon India, Intuit QuickBooks, and the Tata Group. Meet the team →