eBay

around_again_records · ‎01-23-2020

I know this has been asked and answered in the past when eBay first started collecting taxes on fees, but I did not understand it then and I still don't get it. This new tax collecting debacle with the American Sales tax and PayPal fees has got me thinking about it again

Now, I admit math is not my best subject, so I would really like it explained to me how eBay calculates taxes on my insertion and final value fees. I am in Ontario, HST is 13%

A .05 cent insertion fee shows up on my account as .06. That means for every hundred listings (total of 5.00 dollars) I am paying 6.00 with 1.00 of that being HST. 13% of 5.00 is .65, so I am overpaying .35 for every 5.00 in fees. Tax on Final Value fees seem to work out the way it should.

I realize this could be a case of rounding up and not having enough decimal places in the field to show 4 decimal places, but rounding up every 5 cent transaction?????

Everywhere else HST is calculated at the end of the transaction - you get the total of taxable items and then calculate the HST. If it is a monthly bill, the HST is calculated for the total monthly taxable items or service or whatever. I can't imagine trying to figure out any receipt - groceries, hydro, water, or any other purchase if the tax was calculated and then added on to the price of each individual item, or daily consumption rates as opposed to the total monthly consumption.

To me this is a messy way of doing things, and with my math skills, I have as yet, not been able to add things up on my invoice and come up with the same totals as eBay. It's such a mess, I just take their word for it. I'm sure it's just me, because if everyone else was seeing this the way I do, I'm sure there would be an outrage.

Can anyone help me decipher eBay invoices, and the way they charge taxes.

ypdc_dennis · ‎01-23-2020

$0.05 fee with 13% HST is 0.0565 which is always rounded to $0.06 for display purposes. That's the way rounding works. eBay accounting has you owing them $0.0565 not the $0.06 displayed.

Add up your fees without tax included for the invoice month, then apply the sales tax rate, that should match your invoice totals.

Way back when GST/HST/QST first got applied to selling fees there was a lot of discussion about this.

-..-

kawartha-ephemera · ‎01-23-2020

This really is a bit of a dark arts subject. I for one have never had the heart to take a very deep dive in to their numbers though I suspect that rounding is probably an acceptable accounting practice. Your point is well taken though.

Keep in mind that there are also circumstances where the total fee charged including hst is rounded down, not up.

For example, many times my sales include a 2.95 lettermail shipping charge. I'm in Ontario so there is 13% hst added to the 10% fvf.

If I calculate the FVF on shipping without rounding at all it comes to;

(2.95 x .10) x 1.13 = 0.33335

In this example the total fee is rounded down resulting in my being charged just 0.33 cents.

lotzofuniquegoodies · ‎01-23-2020

It's also possible that the rounding is done once all the numbers are added together. Either rounded up or down. In reviewing eBay invoices in the past, they usually give me a migraine and put it aside and try to forget about them. It's similar to when you use either debit or cash. Cash they round up/down. Debit it's the actual amount.

-Lotz

Sidenote. Remember buying a newspaper? If you purchased from the box it was face value. In the store GST/PST/HST may or may not get added. Depending on the province.

around_again_records · ‎01-23-2020

@ypdc_dennis wrote:
$0.05 fee with 13% HST is 0.0565 which is always rounded to $0.06 for display purposes. That's the way rounding works. eBay accounting has you owing them $0.0565 not the $0.06 displayed.

Add up your fees without tax included for the invoice month, then apply the sales tax rate, that should match your invoice totals.

Way back when GST/HST/QST first got applied to selling fees there was a lot of discussion about this.

-..-

Yeah, I get how rounding works, but for the sake of clarity, if eBay feels they have to add the tax to each individual transaction it would be nice if they would increase the decimal fields to 4 digits. Either that or do it the way everyone else (thank heavens) does it and apply the tax to the total at the end of the month or the end of the invoice.

As i said, I knew this had been asked and answered, and back at that time I did go through my invoice and tried to total all the fees at 5 cents and then apply the 13% to see if I came up with the amount that eBay came up with. My eyes went buggy trying to count the lines, and I never did come up with the same totals, so I just gave up. eBay is the only situation I can think of where it is so difficult to figure out an invoice.

lady.stark · ‎01-23-2020

I agree that they like to make it harder than it should be. They like to complicate things so we don't question them.

cumos55 · ‎01-23-2020

When GST/HST were added to the fees calculated by eBay .... the total of FVF plus tax was report to about 4 decimal places...

The total for every month was calculated to the four decimal points, and only then was the total rounded up, or down to the amount reported on an invoice....

around_again_records · ‎01-23-2020

but it doesn't show that. It shows 2 decimal places .06 instead of .0565

around_again_records · ‎01-23-2020

and if they wanted to make it really easy to read and check. They could put .05 and then total them at the end of the month and have a line that said tax and calculate the tax on that line. OMG what a concept.

cumos55 · ‎01-24-2020

What eBay calculates and then what is actually shown in a seller's record could be two different numbers... but related

OR... Could it be that one half the numbers are rounded up and one half are rounded down.

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

When they got rid of the penny in Canada.... a clerk at a local store said that the sale was rounded up for one half the transactions and down for one half the transactions.

The end result is that the store did not lose because the penny was gone

what-sales-direct · ‎01-24-2020

FYI eBay does not round up taxes and insertion fee, that would be illegal!!

For people that pay a monthly subscription, you can have full access to your monthly invoice and you can see that taxes are charged based on the total fees. ( no round up)

It's a little complex to find but here is the sum up -> My ebay -> Seller Dashboard -> summury -> (click on Switch to classic view) on this page you will find the monthly statement that can be downloaded.