Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

As part of the Summer 2017 update, eBay has announced the following.   You will see all updates in the email they are sending.

 

 

 

Today, eBay announced changes that will impact Canadian residents and businesses who use eBay.

To better reflect how we manage and operate our platform in Canada, on July 1st, 2017 we will be changing the contracting party for Canadian residents and businesses from eBay International AG to eBay Canada Limited, a Canadian corporation.

 

As a result, eBay users residing in Canada will begin contracting with eBay Canada Limited. This change will impact these users' User Agreement, User Privacy Notice, Billing Agreement, and other agreements with eBay.

 

The new contracting entity, eBay Canada Limited, is subject to Canadian tax law. As a result, sales tax (GST/HST/QST) will be charged on eBay fees starting July 1st, 2017. The applicable sales tax rate will vary by province, which we will determined based on your registered eBay address. You should confirm that your registered address is correct. The current applicable tax rates are:

 

 

 

 

 

ProvinceRate
Alberta (AB):5.00%
British Columbia (BC):5.00%
Manitoba (MB):5.00%
New Brunswick (NB):15.00%
Newfoundland and Labrador (NL):15.00%
Northwest Territories (NT):5.00%
Nova Scotia (NS):15.00%
Nunavut (NU):5.00%
Ontario (ON):13.00%
Prince Edward Island (PE):15.00%
Quebec (QC):14.75%
Saskatchewan (SK):5.00%
Yukon (YT):5.00%

 

 

While the addition of GST/HST/QST on fees is new, eBay's prices will not change as a results of this legal entity change. Furthermore, you should see no interruption in your service as a result of this change, and you will not need to make any updates to your listings.

 

If you are a business user, we recommend that you consult with your tax advisor to understand your eligibility and the process for claiming an input tax credit on tax paid for services provided to your business.

 

 

 

 

 
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

rose-dee "...this may be an important point for Canadians who have a large personal collection to sell on eBay (or elsewhere), "

 

You are correct.  In general terms sale of used low value personal property does not attract taxation but there are exceptions where, for example, a $1,000+ sale of a collectible sold at profit may attract capital gain.

 

I am not aware of a $3,000 limit.

 

In case of doubt Canadian should consult a compete t tax accountant or contact CRA for more information and Guide T4037 Capital Gains.

 

http://www.cra-arc.gc.ca/E/pub/tg/t4037/t4037-e.html#P941_72799

 

"When you dispose of personal-use property that has an ACB or proceeds of disposition of more than $1,000, you may have a capital gain or loss. You have to report any capital gain from disposing of personal-use property. However, if you have a capital loss, you usually cannot deduct that loss when you calculate your income for the year. In addition, you cannot use the loss to decrease capital gains on other personal-use property. This is because if a property depreciates through personal use, the resulting loss on its disposition is a personal expense."

 

This is a complex issue that cannot be properly handled in a post on this board.

 
Message 141 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

I may be dense, but if I understand this, eBay is charging the seller tax on the sales fee that eBay makes from us? Shouldn't it be coming out of their pocket? It looks as if we pay the taxes on their income, unless I am reading this wrong.
Message 142 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

"eBay is charging the seller tax on the sales fee that eBay makes from us?"

 

NO, NO, NO.

 

Once again eBay is NOT charging tax.

 

The Canadian government is.  The Canadian government decides what is and what is not GST/HST taxable.  They have decided that eBay fees charged to sellers are now GST/HST taxable.  As such eBay is obligated by law to collect the GST/HST on behalf of the government and remit it to them.

Message 143 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

Sorry, eBay is not charging the taxes, the CRA is, gotcha. The problem I was trying to get my head around is why the seller is paying taxes when the fees eBay charges is eBay earnings, not mine. In my mind, that should be eBay paying that bill.
Message 144 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

Its not that much different than paying for any other service. eBay charges sellers a fee and the government charges the person receiving the service a tax. When you get your hair cut the stylist charges you a fee to do so and the government taxes that fee. The stylist is making a profit from the fees she charges and she pays income tax on that, she doesn't pay for the gst/hst that you are charged.  I don't know how ebay's income tax is set up but they definitely aren't responsible for paying the customers tax on sales and goods and services.

Message 145 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

Good metaphor, they always seem to work for this big dummy! Lol
Message 146 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

bomackinno0 -  "In my mind, that should be eBay paying that bill."

 

Another way to look at it is to blame former Prime Minister Brian Mulroney for that.  Seriously.

 

Back in 1988-1989 when the concept of GST was investigated and analyzed to replace the old FST or Manufacturers Sales Tax, the original plan proposed by the Canadian Tax Foundation was to make the new tax invisible as it is in the United Kingdom and Europe (VAT).  I know as I was sitting in those small business panels organized by the Tax Foundation at the time.

 

GST was a good measure meant to help Canadian manufacturers against importers who had a huge edge - tax wise.

 

However when the time came to implement the GST, Mulroney made the political decision to make the tax visible instead of hidden in the price of the goods or services (in my book that was a mistake).  At first, retailers were given the choice to include the tax in the price of show it separately at the cash register.  Some of you may remember those 7% extra or 7% included signs at the checkout.

 

So, if the government at the time had followed in the concept of a hidden tax, businesses today would include the tax in the price of their goods or services and remit the tax while consumers would never see that 7% (GST rate at the time) added to the bill.

 

Oh well, that was then, this is now.  There is no turning back.  We are stuck with its visibility.

 

And life does go on.

 
Message 147 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

Selling items at an auction ...  and the application of GST/HST

 

The auctioneer collects GST/HST on the final price paid by a buyer.

 

The auctioneer does not charge GST/HST  on the commission or on the amount received by the owner/consignor  of the items sold.

 

Why?  ......................................>>>>

 

Because the buyer has already paid the full amount of GST/HST on the total of Commission plus amount received by the consignor.

 

These are the CRA rules as they apply to auctions.... whether on eBay or at a local auction,  if items are sold on consignment

 

 

 

 

Message 148 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

What would happen if we changed our registered address to a US address as that is the address that determines whether you pay tax on the fees?

Message 149 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

More fees. That's all I got out of this.

Everyone seems to be fixated on how we are being taxed. Not that difficult.

There are already skinny margins with eBay and the global market. Now with these "minimal" tax additions, eBay is just trying to get water from a desert.

I'll close my shop.
Message 150 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?


@true-blue wrote:

eBay is just trying to get water from a desert.

I'll close my shop.

Ebay doesn't get a dime from this. In fact it just adds administrative overhead.

Message 151 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?


@dutchman48 wrote:

What would happen if we changed our registered address to a US address as that is the address that determines whether you pay tax on the fees?


Then you would have the IRS hounding you instead, depending on sales revenues.

Message 152 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

true-blue - " eBay is just trying to get water from a desert."

 

One more time, eBay does NOT tax you, the Canadian government does.

 

If you want to complain to someone, contact your Member of Parliament.

Message 153 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

Not enough sales, already have 2 addresses, bank account, Paypal account, and US Ebay account if needed and W-8Ben has already been filed where needed.

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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

Success in a business is knowing what NOT to do

 

And.. this starts with knowing what not to sell...

 

Everyone can make a profit... but the real question is how much profit.

 

Selling low priced items may not work too well on eBay.

 

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I have also seen a situation  where a seller had everything priced at over $100 ... and then they complain about a lack of sales.

 

The answer is...  Low priced items pay the bills... High priced items make the profit......and  at certain times  people may choose not to buy higher priced items

 

-----------------------------------s

 

Then comes the seller  that starts on eBay with new unique inventory...  Sales are very good  and then things slow down.....  Why?  Their inventory   has filled a niche of buyers  and there are less buyers looking for what they sell.

 

The answer to this problem is to find new inventory that is complementary to that first group of inventory  Also  one must add new  and different inventory on a continuous basis

 

--------------------------------------------------------

 

A seller  has to work the inventory on eBay... always add new inventory  and find new items to sell, also new unique inventory,  and then new items in new, but complementary categories.

 

This I know from personal experience......  This is the business of selling.......

Message 155 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

As I have stated before, I am selling off my collection. I don't buy inventory to resell. Once collections are gone, so am I, and possibly sooner.

Message 156 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

Um... so why now... ??  eBay.ca has been around for a long time...  Did the government just catch up to them or what?

So, more fees; yeah, I get it.  If you list on .com and get billed on .com in USD, are you still going to be paying tax on your fees?

It's bad enough they charge fees on shipping so I have to hike the cost.  Now, being in a 15% zone, I'll have to account for that too... Smiley Frustrated

 

Sorry if these questions have been asked & answered already... there are 8 pages of discussion here...

Message 157 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

Because we were billed through Switzerland before.

 

As of July 1st, we will be billed by Canada so now tax on the Ebay fees become owing according to our government.

Message 158 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?

' Now, being in a 15% zone, I'll have to account for that too."

 

Nobody likes to pay taxes.  Based on your sales of the last three months, if GST/HST had been charged on eBay fees during that period, it would have cost you an extra $1.20 a month on average. It is not good but we all have to pay taxes one way or the other.

 

 

Message 159 of 210
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Canadian sellers to be charged GST/HST/QST on all fees effective July 1 2017?


@pierrelebel wrote:

 

Nobody likes to pay taxes.  Based on your sales of the last three months, if GST/HST had been charged on eBay fees during that period, it would have cost you an extra $1.20 a month on average.

 


Creeper, LOL.

Probably would have sold more if shipping didn't cost so much.  Not worth listing 😛

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