eBay

gezeilstra · ‎02-23-2005

I know from previous posts that Ebay has no way of letting Canadians add PST or GST in any clear manner, but just wanted to clarify on the following:
PST is charged on items sold to buyers in my province
GST to items sold to buyers in Canada
PST is charged on selling price, GST on price + shipping?
Example: items sells for $10, shipping is $5. PST charged is .70, GST is $1.05?
Thanks!

javax.swing · ‎02-23-2005

GST is charged on shipping price only if it is above the actual shipping price. If it costs $5 to ship and you charge $5, GST doesn't apply. If you charge $5.01, GST applies.

ospreylinks · ‎02-23-2005

Javex...Re #1.... what????? Where did you get that kind of info. GST is not applicable only if there is a spread???? If your accountant gave you that info, time for a new accountant or Rev Canada is going to have a field day with you come audit....(can you say "you will be responsible to pay GST not collected on freight charged")...

GST is applicable on freight no matter what. You charge the buyer 7% GST, you get a 7% GST input credit when you pay for the postage.... one may wash the other, but in terms of collecting and reporting, you have to show the collection of the GST on the invoice freight value and then again you will claim the input credit on your purchase of postage, as I say one may offset the other, but it still has to be collected and reported.

Jeff

recped · ‎02-24-2005

Ospreylinks is absolutely correct.

to the OP, are you registered for GST/PST? PST is also charged on shipping costs at least in Ontario

Ben

"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.

ellingtons · ‎02-24-2005

gezeilstra ,

I gather you live in Manitoba, you would bill as follows:

Selling Price: $100.00
Shipping: $10.00
-------------------------------
Total Selling Price: $110.00
GST (110.00 x 7%) $7.70
PST (110.00 x 7%) $7.70
-------------------------------
Total Charge: $125.40
-------------------------------

If you dont already have a vendors permit/PST number, get one, and they will send you all the information you need to know to charge properly. Its also helpful for claiming ITC's on all the things you bought for resale

Josh

muminlaw · ‎02-24-2005

And remember HST? Atlantic Provinces (except PEI) are subject to 15% Harmonized Sales Tax.

Glenda

Glenda

gezeilstra · ‎02-26-2005

Thanks for all the info, I am registered for both (newly), and didn't realize that I need to charge PST on shipping in MB, although anytime I sell something in MB they usually pick it up anyway...

The GST makes sense because, like mentioned above, I can claim the GST charged on the postage back as an input, but the PST, from what I understand, can only be claimed back on goods purchased for resale, which would exclude postage, so PST would be charged twice, once to me and once from me to the buyer. Guess I better read up on the stuff they sent me!

I went to a seminar, found that GST is pretty straight forward but that the PST rules are crazy, especially now that they include some but not all services. I also do computer support, they said (and this is a Revenue Canada employee) that if I stand behind someone and tell them how to fix their computer, there is no PST, but if I sit down and fix it myself, there is PST!

They don't seem to realize that making the rules grey & ambiguous promotes non-compliance of the tax laws, it's easier to comply with something that makes sense.

Try this one, they said that if I go to AB and buy something for my business (say a cash register - no sales tax in AB), if I bring it back I need to do a sell assessment on the PST and remit it! Who would ever both to do that? It even applies if I buy something at a garage sale and use it. Another example of a stupid law designed to set people up for failure to comply....

shoplineca · ‎02-26-2005

gezeilstra
I would suggest that when writing on a public discussion board you fully agree with the Provincial and Federal tax laws and say that you think they are wonderful as they are their to help your economy as a whole.

... and then do what you think is best!

Depending on where you are purchasing items, you should be able to use your Provincial Sales Tax number to purchase without paying provincial tax and then simply remit to the Province, that which you have charged and collected from your customers in Manitoba.

When going to garage sales or flee markets, bring a blank receipt book and record each purchase together with sales tax numbers if charged tax by the vedor.

Malcolm

recped · ‎02-26-2005

I'm not familiar with Manitoba Sales Tax rules but in Ontario you cannot "claim back" PST, you can only purchase goods for resale "tax exempt".

Our entire tax system is based on voluntary compliance and self assessment. I do agree that provincial sales tax rules are overly complicated, this has primarily resulted from lobbying of various groups to have some types of goods and services exempted from tax, the end result is the patchwork that you refer to.

Ben

"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.

vesivus · ‎02-26-2005

These are the types of discussions that make me happy I live in Edmonton, AB. 😛

Sorry... had to toss that one out. 🙂

rd1000 · ‎02-27-2005

Gezeilstra

You make a god point. We have to pay PST on postage when we ship the item, and the customer has to pay PST when they pay us for the postage. Seems to me to be a double charge.

Ben,

If you pay PST on goods that you resell, you can claim back the PST. There is a form to fill out, and you send the receipts. I claimed back 17 purchases on one form once, and guess what they sent me? Yep. Seventeen seperate checks in seventeen envelopes. Got them all on the same day. Talk about efficiency.

Rob

recped · ‎02-28-2005

Rob

That's interesting, 30 years of collecting and remitting sales tax I must have missed that one. Of course I don't think I ever paid PST on resale items but I can understand how this could occasionally happen.

I was really just trying to make sure the OP understood that PST is not like GST in terms of ITC's etc.

On the double tax issue, well I suppose this is the type of situation where one could be paying on "services for resale", my guess is that if you have an account with Canada Post and provide an exemption certificate they don't charge you PST.

I'm lucky because 98% of my sales are outside Canada and of the few that are in Canada 90% are outside of Ontario.

Ben

"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.

ospreylinks · ‎02-28-2005

I don't pay PST on freight..... Postage is GST only, if I ship UPS, I am only charged GST, I am charged PST on extran insurance....

I don't think you are paying PST on postage, so it isn't double taxation.

Jeff

shoplineca · ‎02-28-2005

Thats correct Jeff, only GST on postage.

Malcolm

ospreylinks · ‎02-28-2005

So where is the discussion on dual taxation on freight coming from?

Jeff

mkahiel · ‎03-01-2005

An Ontario Canadian seller posted the following statement in auction listing. IS IT RIGHT?

---- Start ----
We have to charge PST & GST or HST in all provinces.
AB 7%, BC 14%, MB 7%, NB 15%, NF 15%, NS 15%, NT 7%, ON 15%, PE 17.7%, QC 15.025%, SK 13%, YT 7%
---- END ----

Not trying to offend anyone here.

muminlaw · ‎03-01-2005

mkahiel, definitely not!

Registered Canadian sellers are only to collect PST from buyers in their home province. The only exception is from NB, NF & NS, who opted in to "Harmonized Sales Tax".

That Ontario seller should be charging:
AB, BC, MB, NT, PE, QC, SK, & YT @ 7% GST
NB, NF, NS @ 15% HST
ON @ 15% GST & PST

The exception to that ruling would be if he has a branch of his business in each of the provinces. Then he would, indeed, be required to collect PST from buyers in each province.

Hope that helps to clarify it.

Glenda

Glenda

mkahiel · ‎03-01-2005

Perfect. Thank you Glenda

gezeilstra · ‎03-06-2005

Hey Guys,
Lot's of great info and discussions. Something else I found out, if you have been paying PST on items that you are selling, and did not get an exemption, you can either fill out a form to do a claim or (and Revenue Canada recommends this course) you can track it internally and offset it against PST that you do have to remit (just keep the paper trail!).

You are also correct, there is no PST on my Canada Post receipts, my mistake. Now if I could only offset my gas to drive to the post office against their Fuel Surcharges!

shoplineca · ‎03-07-2005

Why would Revenue Canada recommend you to file a form to recover PST? Its not their jurisdiction!

Essentially, you must report PST charged and collected and report PST not paid for personal-use items. On that same remittance form, you report PST you paid on items you sold under the column titled "Adjustment" #6 (for Ontario).

The frequency of reporting PST depends on your annual sales, and is usually determined by the Province where as with GST, you elect whether you report monthly, quarterly, semi-annually or annually.

You also can make adjustments at year-end when preparing your financial statements for filing your tax returns.

Malcolm