eBay

nhl_canada · ‎02-22-2023

I'm super confused now that Ebay is collecting tax on our sales. I'm trying to fill out my T2125 but I can't figure out if I'm supposed to report the tax that Ebay took off or not. Do I include it my gross income and then deduct what Ebay took? Anyone know? Thanks!

reallynicestamps · ‎02-22-2023

Are you registered to collect and remit sales taxes in your province?

Many sellers use eBay as part of a larger business which is registered.

If you are,consult the accountant your company uses.

If you are not registered and never collected tax on your own, the buyer paid sales tax which eBay collected and sent to the appropriate tax authority.

The tax was invoiced on your selling account for convenience.

You did not receive those taxes. You did pay eBay a fee to collect and remit them on your behalf.

So --and I am not an accountant--you have expenses but no income on these.

recped · ‎02-22-2023

@nhl_canada wrote:
I'm super confused now that Ebay is collecting tax on our sales. I'm trying to fill out my T2125 but I can't figure out if I'm supposed to report the tax that Ebay took off or not. Do I include it my gross income and then deduct what Ebay took? Anyone know? Thanks!

My answer would be no you should not include GST/HST/PST/QST collected by eBay in your gross revenue number.

"What else could I do? I had no trade so I became a peddler" - Lazarus Greenberg 1915
- answering Trolls is voluntary, my policy is not to participate.

byto253 · ‎02-22-2023

That is correct. From an accountant relative, your gross is sales and shipping and does not include tax ebay collected for you.

Even if you collected HST yourself it is not reported as gross sales. It is a tax on sales, not part of sales.

regs43 · ‎02-23-2023

Not a tax professional at all, but started looking at taxes recently as well

I use turbo tax self employed which says to include GST/HST/PST IF YOU collected it. So in the case of ebay that would be Jan 1- Jun30 2022 IF registered to do so.

I would tend to agree July 1-Dec 31 Tax would NOT be included in that total revenue number as you never saw the money in your account/had it in your posession

Then you indicate the amount you DID collect in the last box on my picture above. (Jan1-Jun30 for ebay purposes)

GST/HST return is filled seperate for ITC's

I would talk to an accountant though if you have questions 🙂 not sure how other people file, just sharing my screen!

doc_scribe · ‎02-23-2023

@regs43 wrote:
Not a tax professional at all, but started looking at taxes recently as well

I use turbo tax self employed which says to include GST/HST/PST IF YOU collected it. So in the case of ebay that would be Jan 1- Jun30 2022 IF registered to do so.

I would tend to agree July 1-Dec 31 Tax would NOT be included in that total revenue number as you never saw the money in your account/had it in your posession
Then you indicate the amount you DID collect in the last box on my picture above. (Jan1-Jun30 for ebay purposes)

GST/HST return is filled seperate for ITC's

I would talk to an accountant though if you have questions 🙂 not sure how other people file, just sharing my screen!

Your second scenario is where I land - as an eBay Transaction which they report throughout our Seller Hub and Performance stats as Total Sales (includes taxes). For example, this mostly redacted Performance > Sales report:

From our P.O.V. tax collection and remittance is merely a value-add service which we pay eBay fees (taxed) to peform on our behalf under their registration numbers. The tax component of the total transaction never touches our hands or accounts, only the Item + Shipping (minus fees).

So I am also unsure how CRA will interpret this potential discrepancy (e.g. during an audit). I mean, if we are reporting Item + Shipping as our Total Sales, and eBay is reporting their Total Transaction (all taxes included), then those numbers will not match. It's 'Our' Sales vs. 'Their' Transaction. Not the same thing.

And FWIW, that sample Performance > Sales report sure looks like the boilerplate for a future T4A to me...

recped · ‎02-23-2023

So I am also unsure how CRA will interpret this potential discrepancy (e.g. during an audit). I mean, if we are reporting Item + Shipping as our Total Sales, and eBay is reporting their Total Transaction (all taxes included), then those numbers will not match. It's 'Our' Sales vs. 'Their' Transaction. Not the same thing.

eBay does not provide the CRA with any seller specific information, not about GST/HST/PST/QST, not about gross sales.

Could CRA request that info? Yes. Would eBay supply that information for a specific seller? Yes they probably would. Would eBay provide that information in bulk for all sellers? Possibly but past history indicates they would fight the request unless tax laws where changed to require it.

About 15 years ago CRA demanded eBay provide detailed informastion on all Canadian powersellers, after several years of bickering eBay did finally agree to provide seller specific information for one or two years (2009?). While it's possible that this information transfer resulted in some audits but I don't recall anyone posting on this board about an audit related to the eBay data dump.

"What else could I do? I had no trade so I became a peddler" - Lazarus Greenberg 1915
- answering Trolls is voluntary, my policy is not to participate.

ricarmic · ‎02-23-2023

@recped I do know of someone who was audited because of these way back when.

They deserved to be as they didn't pay any HST etc that/one year, so they were asking for trouble.

It was as a result of the ebay disclosure though, I don't remember 100% but I think that's what they told the person when they came looking for the GST/HST.