eBay

rmisenerryan · ‎05-28-2022

How do I ensure tax is not charged on tax exempt items? Gold and silver bullion is tax exempt, period. No retailer needs to charge it when selling in a physical location - small or gigantic retailers alike.

marnotom! · ‎05-29-2022

The official line from the eBay tax team is that it’s the transaction that’s going to be taxed, not the item. This is apparently the result of work and consultation eBay did with CRA.

What we don’t know at this point is if a transaction tax would apply the same way as a tax on the item.

pjcdn2005 · ‎05-29-2022

You could be right but I'm not sure that some of the things said by eBay shortly after the original announcement about buyers being taxed on eBay are totally accurate. When you go into a store you are taxed on the item not on the transaction. If I order online from a retailer, I am taxed on the item, not on the transaction. For example I have ordered bullion online from various retailers and from Canada Mint and not been taxed. I don't see why it would be any different here.

pjcdn2005 · ‎05-29-2022

When you put an item in the cart you will see right away if there is tax on it. Starting July 1 when eBay starts collecting sales tax on Canadian transactions they should hopefully have it set up so that we pay tax only on taxable items in our location. If a zero rated item is charged tax, you would have to contact ebay. It is possible that the taxes will be based on the listing's category. If that's the case it would be important that bullion be in the correct category.

Until then, only retailers that are registered to collect tax should do so. If they are charging tax on a non taxable item you will have to contact the seller.

marnotom! · ‎05-29-2022

@pjcdn2005 wrote:

You could be right but I'm not sure that some of the things said by eBay shortly after the original announcement about buyers being taxed on eBay are totally accurate. When you go into a store you are taxed on the item not on the transaction. If I order online from a retailer, I am taxed on the item, not on the transaction. For example I have ordered bullion online from various retailers and from Canada Mint and not been taxed. I don't see why it would be any different here.

This quote from the "tax team" via Velvet seems pretty clear about the fact that it's the transaction that's going to be taxed, not the item:

https://community.ebay.ca/t5/Canadian-Sales-Tax/Canadian-for-used-item/m-p/478597#M283

Why might it be different? Let's try this: eBay isn't a brick and mortar store, for starters, and it doesn't have any inventory. eBay is providing a liason service between buyers and sellers but not selling the item itself and it's eBay that's collecting and submitting taxes, not the seller. Ergo, the tax that eBay is charging and collecting is for the liason service, not the item. Sound plausible?

Also, the "tax calculator bot" may not have much more than the item's category to refer to when calculating taxes. Not all listings have Item Specifics filled out every which way to Sunday (particularly collectibles and OOAK stuff) and not all items in a particular category are subject to the same extent of taxation in every province, particularly those with a separate provincial sales tax. It may be more straightforward to apply taxes to the transaction than to the item.

reallynicestamps · ‎05-29-2022

As a buyer or as a seller?

As a buyer/importer the Canadian sales taxes would be charged at the border.

You can apply to CBSA, their contact info should be on the package, to get any sales taxes (or duty??) refunded.

This is likely to be more complicated with GSP*, but the best way to deal with GSP is not to buy from sellers using the GSP.

As a buyer of domestic items, your seller should already know not to charge sales taxes. And he should have his tax number on the invoice you recieve (even if the item is zero rated because why have two forms?).

As a seller, your US customer may be charged sales taxes by his state. While he pays those (and if purchase should be tax-free, it's up to him to deal with his own tax authorities) you will be charged a fee by eBay on the entire payment- product, shipping and taxes. But that's not a fee on the product, that's a fee on the processing of the payment.

When shops accept credit cards, they pay their processor (Moneris is one big one) fees based on the total money processed with no breakdown of why.

Come July, sellers will also be seeing Canadian sales taxes charged for online purchases. But the seller will only be charged the eBay fee, the buyer pays the sales taxes.

While we can keep ~~nagging~~ reminding eBay ( Hi! jasmen@ebay ) about categories that should not be taxed - like children's shoes in BC- it may be that again we will be applying to get incorrectly charged sales taxes refunded. Now we just need 13 addresses of tax collecting entities.

*And it keeps coming up, so, the GSP specifically does not charge the buyer any duty or sales taxes. The GSP charges import fees which it uses to pay duty and sales taxes.

Also, the GSP does not handle business to business transactions. They will not break out how those import fees are, because it makes not difference to consumers and they don't deal with business to business transactions.

pjcdn2005 · ‎05-29-2022

It seems clear that the reply is answering a comment about tax on used items. That is the same reply they use on the US boards if someone questions paying taxes on used goods. Sounds plausible yes but it is not 'proof' that they are definitely doing that for zero rated items. I don't know how they will be handling it and since we appear to have the same amount of information, I don't think that you 'know' for sure either.

In the US, the tax being charged is based on the category. For example, if clothing is non taxable in Montana, a buyer in Montana will not pay tax on clothing as long as the item was listed in the clothing category. But if a jersey was listed in the Sports mem section rather than clothing, tax would be charged. That method is not 100% accurate but it is more accurate than charging tax on all non taxable items. Is it not 'plausible' that they will doing the same in Canada?

marnotom! · ‎05-29-2022

@pjcdn2005 wrote:

It seems clear that the reply is answering a comment about tax on used items. That is the same reply they use on the US boards if someone questions paying taxes on used goods. Sounds plausible yes but it is not 'proof' that they are definitely doing that for zero rated items. I don't know how they will be handling it and since we appear to have the same amount of information, I don't think that you 'know' for sure either.

I didn't say that I knew for sure and I wasn't offering that quote as proof that zero-rated items would be taxed. I apologize if I gave that impression; I was just trying come up with a slightly-educated guess as to why the "tax team" was referring to tax being charged on the transaction rather than the item (or category). I believe I did mention that we really don't know what a transaction tax on an eBay purchase is going to look like. But I think it does give eBay an "out" in cases where we may feel that tax is being charged inappropriately.

@pjcdn2005 wrote:

In the US, the tax being charged is based on the category. For example, if clothing is non taxable in Montana, a buyer in Montana will not pay tax on clothing as long as the item was listed in the clothing category. But if a jersey was listed in the Sports mem section rather than clothing, tax would be charged. That method is not 100% accurate but it is more accurate than charging tax on all non taxable items. Is it not 'plausible' that they will doing the same in Canada?

Yes, and again, apologies if my post wasn't very clear on that. I think that a "transaction tax" would be based on the category in which the item is listed. It's still different from taxing the item itself, of course.

femmefan1946 · ‎05-29-2022

In some provinces (BC for example) used goods are taxed.

But the GST does not seem to be applied to used goods.

How this works out in harmonized tax provinces I am not sure.

marnotom! · ‎05-29-2022

It’s been pointed out elsewhere that Value Village charges GST (and HST?) on what it sells.

For funsies, I decided to search for information on how used vehicle sales are handled from a taxation standpoint. The variation from province to province is staggering:

https://driving.ca/features/feature-story/which-sales-taxes-do-i-owe-on-a-used-car-a-province-by-pro...

pjcdn2005 · ‎05-29-2022

The gsp is applied to used items.

busybeas_books · ‎05-30-2022

It’s been pointed out elsewhere that Value Village charges GST (and HST?) on what it sells.

Here in Nova Scotia Value Village charges 5% GST on books but 15% HST on other items.

cumos55 · ‎05-30-2022

Books are exempt from the Provincial Tax in GST Provinces and from the provincial part of HST in HST Provinces.

This means that books are only taxed GST = HST = 5% in all provinces and territories of Canada.

Books should not be charged the Provincial Tax at all locations in Canada.... and.... this should apply to all sales of books on eBay

If books are taxed the full amount, GST plus provincial tax or HST at 13 % or 15 %, the the buyer can apply for a refund of the provincial tax from the Canada Revenue Agency. Making all of these refunds may not be something the Canada Revenue Agency would like to do at a very, very high level

Or ..... Is it the provinces and territories that refund the Provincial Tax charged on books?

femmefan1946 · ‎05-30-2022

Apparently not by Sally Ann.

At least this BC one

And that purchase did include books.

I recall that one of the objections to the GST was that it taxed books.

velvet@ebay · ‎06-03-2022

@rmisenerryan wrote:
How do I ensure tax is not charged on tax exempt items? Gold and silver bullion is tax exempt, period. No retailer needs to charge it when selling in a physical location - small or gigantic retailers alike.

Hi @rmisenerryan! The tax team said:

Beginning July 1, 2022, eBay will be responsible for the configuration and taxation of all items sold to purchasers in Canada – including exempt items. If an error is made, eBay will refund the buyer any tax over-collected and will be responsible for any tax under-collected. eBay is utilizing third party software and taxability rules to ensure the proper tax treatment of all items listed on the site.

rmisenerryan · ‎06-05-2022

If taxing the transaction, then we only pay tax on eBay's fee itself right? Not the entire value? Except we already do....

marnotom! · ‎06-05-2022

@rmisenerryan wrote:

If taxing the transaction, then we only pay tax on eBay's fee itself right? Not the entire value? Except we already do....

The buyer pays the taxes on the transaction, the seller's fees are a percentage of the entire transaction charge, then there are tax charges on the fees for the seller to pay.