Opinion Please on charging Sales Tax when not mentioned in the listing.

[phoebescollectables]

On another board a newbie has asked about a seller who is trying to collect sales tax when it is not mentioned in the listing. I have tried to find something on eBay help pages about this.

Anyone have any thoughts on the right way to handle this.

Thanks

[shoplineca]

TOS should indicate if taxes will be charged however the seller, if a registered business, has a legal obligation to collect and remit taxes.

As the Seller did not post this in his TOS, the buyer shold ask the seller for his tax ID numbers BEFORE paying any tax. The Buyer should then verify if the numbers correspond to the business he is purchasing from.

Whether taxes are posted or not, buyers should assume that they may be charged tax.

Malcolm

[phoebescollectables]

Malcolm,

I agree but only to a certain extent. Most buyers (especially new ones) don't even think that taxes may come into play.

I just wonder why eBay doesn't take the time to address this in their listing rules.

Michael

[shoplineca]

Michael
I know that as well as I have had a couple of people express surprise when I invoiced them although taxes are clearly spelled out in my TOS.

The fact remains that consumers walk into retail stores and expect to pay taxes, yet the stores' TOS are not posted anywhere.

Anyone looking at purchasing anything, anywhere should expect to pay taxes and be surprised if they arent charged any.

eBay cant highlight this, although I know somewhere it will be addressed by them.

The reason eBay doesnt make it a promary issue to address newbies is that not everyone selling on eBay is a registered business.

The US doesnt have federal tax and most goods sold by the majority of sellers are shipped to a state or province different from theirs. So for the majority of sales going through eBay, tax is not an issue in the transactions.

Bottom line is that while it is the responsibility of each Seller to clearly state their terms, every consumer must not make assumptions but should follow the rule of Buyer Beware. By this I mean that simply because it was not posted in the Seller's TOS, doesnt mean it cant be or shouldnt be charged.

Seller never gave up his right to charge it by not indicating that he charges tax. It is a state, federal and/or provincial law compelling the buisiness to charge tax and remit to that arm of government and for the buyer to pay taxes levied at the time of purchase.

Malcolm

[muminlaw]

I seem to remember way back when we first registered with PST in BC, that it was a requirement that the resale license and tax number had to be posted near the cash register. I don't know if that requirement has changed and I don't know how it applies to mail or internet sales, but I have a feeling that resale numbers should be posted in one's TOS (I'd better go revise mine!).

Malcolm, how does the buyer go about verifying that the number does, indeed, correspond with that business? I've often wondered about that ...

Glenda

[laplaya29]

The last 3 sales I have had that were sold to Canadians, somehow or for some reason they added on the sales tax to the amount of the auction. 99% of my auction sales are US or International so I wouldnt charge them taxes anyways. I am not charging anyone sales taxes because I am selling personal effects, and I dont think (correct me if I am wrong) that I need to charge taxes on my personal belongings that I am selling. If I sell one of my chairs, yes, I would charge the taxes, but no one has bought one of my chairs through ebay.

[shoplineca]

Glenda
Sorry I couldnt get back sooner, I was shipping some instruments out today.

Once provided the sales tax number by the Vendor, it is a simple matter of calling the local provincial sales tax office and verifying that the number corresponds to the vendor selling the goods.

I assume the same thing for GST that one can call the toll free number for them found in the blue section of the yellow pages and verify the number.

The PST Vendor Permit must be placed in a visible place in the business (although no requirement for the GST number or BIN), preferrably by the cash register however I assure you I cant read my numbers from more than 3 feet away as they are in a size 10 font on a 4" X 8" form.

I have my GST and PST numbers on all my invoices whether I am charging tax or not. If someone asks me ahead of time to provide it and they are entitled to it as I am charging them tax on a sale, I will provide it for them.

I would never put my tax numbers on eBay for fear that someone will use my tax number to purchase goods pretending they are for resale and not pay tax on them and I end up getting audited.

Malcolm

[muminlaw]

That's about what I was thinking about posting them in auctions although I hadn't thought as far as auditors checking up! Yechhhhh!!

I have our GST number on invoices but have never bothered with the PST number ... hmmmmm, another revision. And believe me, you ain't the only one can't read size 10 font, except I can't read it from ANYWHERE anymore! At least not without my specs X-(

Glenda

Thanks for the info about checking -- I didn't know people could do that!

[ospreylinks]

I don't think it is necessary to put your PST number on invoices, however if charging GST, the GST number must be present.

Jeff

[shoplineca]

Jeff
You are correct. All you have to do is put your GST number on your receipts, as you can see on all your store receipts fod goods purchased.

I do it because I do it and no other reason.

Malcolm

[ospreylinks]

The reason you have to put your GST number on invoices and not PST is due to input credits available for GST (which instead of input credits, you gain tax exempt status for resale goods in Ontario, don't know about other provinces).

As is the case of GST, it is taxable on just about every good and commodity (sold within Canada) and is charged regardless if the items are for resale or not.

As a registered enterprise can claim back the value of GST on goods for use within the business, the GST number must be present in case of claiming an input credit, Revenue Canada can prove that the vendor actually paid GST on the goods and it was credited to a valid GST account.

When I built the golf course, of course we were paying sizable invoices with GST. Due to the size of our input credits, Revenue Canada audited our invoices with each quarterly submission (no big deal, just involved taking the form and applicable invoices to the local Revenue Canad Office) and the clerk there checked to insure that each invoice that showed GST being charged had an applicable GST number. I am sure they also checked to ensure the registrants were legitimate.

Jeff