GST on Courier services

"Parcel chhota ya bada ho, GST toh lagega hi!"

Let us start with a real-world situation that many of us can relate to.

Mitali, a home baker in Pune, has just received an order for twenty boxes of cupcakes to be sent to Ahmedabad for a birthday party. She calls up her trusted courier company. The basic courier charge for delivery of the package weighing around 5 kilograms is ₹850.

Sounds simple, right? But here comes the twist—GST on Courier services enters the scene.

The courier company adds 18 % GST to the base amount. Now let us do the math:

• Base courier charge: ₹850
   
• GST at 18 %: 850 × 0.18 = ₹153
   
• Total payable by Mitali: ₹850 + ₹153 = ₹1003
   

Mitali pays a total of ₹1003 for a service that was quoted at ₹850. And that extra ₹153? That is the power of GST on Courier services, a tax that pops up almost invisibly on every consignment, big or small.

Now imagine this scenario multiplied across India. Small businesses, ecommerce giants, job seekers sending portfolios, parents sending food to their hostel-going kids—millions of such parcels travel daily under the shadow of this 18 % tax.

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But here is where it gets juicy. What if you are a courier business? Can you reclaim this tax? What are the tax codes? Does international shipping follow the same rule? Why do some services charge 0 GST?

Spoiler alert: The answer involves HSN codes, ITC benefits, input-output balancing, and yes, a lot of math!

So buckle up. This is not just any blog. This is your full-blown, no-boredom ride through the world of GST on Courier services—loaded with examples, real costs, spicy calculations, and desi-style storytelling.

Because in India, even a small "parcel bhejna hai" comes with big tax tales!

“Courier ka bill samjho toh GST ka khel jeeto!”

GST on Courier services – Different Categories of Courier services with Price and Applicable GST Rate
 

In each of these, GST on Courier services is 18 % of the base price. For a ₹300 parcel, GST of ₹54 leads to ₹354 total. Calculations like this are standard across courier categories.

HSN Codes for Courier services 
 

The HSN code 996812 specifically refers to courier services, while other codes cover postal and local delivery operations. These codes are used when filing GST returns.

“Full on jugad, GST ka dhang!”

Types of Courier services and Their GST Applicability 
 

Export courier attracts 0 % GST via integrated GST regime. Import courier is taxed at 18 % when received in India. Standard and express domestic services always attract 18 % GST.

Impact of GST on the Courier services Industry with Examples
Courier firms needed to upgrade their registration and invoicing systems after GST rollout. Third party logistic companies saw marginal increase in compliance cost. Many courier staff noted slightly higher delivery prices to customers.

Example in third person
Rahul runs a delivery startup in Kolkata. He charges customers ₹400 per parcel. After applying GST on Courier services, he issues ₹472 invoice (GST ₹72). He also claims input tax credit for his fuel and packaging purchases.

Numerical Calculation

• Base price: ₹400
   
• GST at 18 %: 0.18 × 400 = ₹72
   
• Total invoice: ₹472
   
• If Rahul spent ₹50 on packaging with ₹9 GST, he can claim ₹9 credit. Net output tax liability = 72 - 9 = ₹63.

“Yeh GST ke baad bhi mast chalta hai!”

Input Tax Credit (ITC) on Courier services

Courier providers may claim ITC for GST paid on business inputs. Inputs may include fuel, packaging, software, and rent. For example, a courier business paid ₹1000 in GST on fuel. It also collected ₹1800 GST on services. The net payable tax is ₹1800 minus ₹1000 equals ₹800. This reduces tax burden significantly.

Example – Shreya's GST Game Plan in Action

Shreya runs a small courier service in Bangalore. On a busy Monday, she purchases packaging boxes worth ₹500, and the seller charges her ₹90 as Goods and Services Tax at 18 %.

Step 1: GST Paid on Purchase (Input Tax)

• Packaging material cost: ₹500
   
• GST on packaging (18%): ₹500 × 0.18 = ₹90
   
• Total paid by Shreya: ₹500 + ₹90 = ₹590
   

This ₹90 is her input tax, which she can claim as credit.

Later that day, Shreya ships parcels to customers and charges ₹600 per parcel as service fee. She adds 18 % GST, which comes out to:

Step 2: GST Collected from Customer (Output Tax)

• Courier service charge: ₹600
   
• GST on courier service (18%): ₹600 × 0.18 = ₹108
   
• Total invoice to client: ₹600 + ₹108 = ₹708
   

Now here comes the smart tax part. Shreya collected ₹108 as output tax but already paid ₹90 as input tax on packaging.

Step 3: Net GST Payable to Government

• Output GST collected: ₹108
   
• Input GST credit claimed: ₹90
   
• Net GST payable: ₹108 − ₹90 = ₹18
   

Instead of paying the full ₹108, Shreya only needs to pay ₹18 to the government. This is because Input Tax Credit helped reduce her tax burden. She becomes more cost-efficient without overcharging customers or absorbing unnecessary tax costs.

Conclusion – “Delivery ho gayi, ab tax ki kahani yaad rakhna!”

So, the next time your parcel lands at your doorstep and the bill looks a bit beefed up, you know who the silent partner is—GST on Courier services. Whether you are sending your friend a birthday gift, running a booming bakery business, or shipping bulk orders across states, this 18 % guest never misses the ride.

Also Read - GST on Labour Charges – Rates, Applicability & Billing Guide

It is like the extra chutney with your samosa—you might not ask for it, but it comes anyway. And when you understand how it works, you can turn it into an advantage—especially if you are a business owner claiming Input Tax Credit.

Now you know the HSN codes, the tax slabs, the 0% twist for exports, and even how a ₹500 courier bill becomes ₹590 in seconds. It is not just tax talk anymore—it is power in your pocket.

Because let us face it: India delivers everything with a little tadka—including taxes.

“Parcel bhejna hai? Toh GST ka hisaab bhi saath le jaana!”

Now go ahead, send those parcels, file those returns, and never get shocked at that final invoice again. You are officially smarter than most people when it comes to GST on Courier services.

If you need further clarity, check the official GST portal of India at https://www.gst.gov.in. The HSN code list appears in their services section under Chapter 99.

FAQs Related to GST on Courier services

Q. Is GST on Courier services applicable on express and same day deliveries?
Yes. All domestic courier services including express and same day attract 18% GST.
 

 Q. Can exporters claim 0% GST for international shipments?
Yes. Export of courier is treated as 0 rated under IGST.
 

 Q. What is the HSN code for courier invoices?
Use 996812 on all courier service invoices in India.
 

 Q. Can small courier firms use composition scheme?
No. Composition scheme is not available for courier services under GST.
 

 Q. What is the due date for GST payment by courier businesses?
A general taxpayer must pay GST by the twentieth day of the next month.

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