If I refund U.S. buyer they are still out the tax?

[hallscrystal]

Shipped a glass to the U.S. and it arrived broken Feb. 1. They requested a return through eBay Feb.2.

I clicked on the link in Overview to see how to proceed and got the message "you have accepted a return".

I don't want it returned, I just want to refund so this morning I see there is a link on the "send a return label" page that says "if you prefer you can refund the buyer now" but when I click on that link their refund does not include the tax they paid which doesn't seem fair to the customer. Or, will it re-adjust to the full amount when I click through?

I want to make sure I keep track of everything and do it by the book so there are no problems later.

(Not impressed that by clicking on "all open returns/replacements" on my overview page I was accepting the return!)

[kawartha-ephemera]

Yes, ebay will refund the sales tax they collected making the buyer whole. The buyer may notice a small variation if you sold the item in CAD to a USA buyer who paid with a USD credit card.

[lotzofuniquegoodies]

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@kawartha-ephemera wrote:

Yes, ebay will refund the sales tax they collected making the buyer whole. The buyer may notice a small variation if you sold the item in CAD to a USA buyer who paid with a USD credit card.

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Does it work the same way with the tax being refunded if it is a partial refund? Or are there options in MP do a partial refund? I believe it used process appropriately when a refund was handled directly in PayPal. Asking in advance so no surprises.

-Lotz

[hallscrystal]

Thank you, I received the $49.59 (less fees) even though they paid $53.56. But they are keeping the (damaged) item so wouldn't the tax have to be paid by somebody? Or am I missing something?

"Refund the buyer

Purchase priceC $26.95

Original shippingC $22.64

Total refundC $49.59

Comments"

[byto253]

The tax is a % of the price.  With a full refund the selling price is $0 therefore there should be no tax.  

[kawartha-ephemera]

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@hallscrystal wrote:

Thank you, I received the $49.59 (less fees) even though they paid $53.56. But they are keeping the (damaged) item so wouldn't the tax have to be paid by somebody? Or am I missing something?

"Refund the buyer

Purchase priceC $26.95

Original shippingC $22.64

Total refundC $49.59

Comments"

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From the limited information supplied it looks as if the buyer resides in a State with a 10 % IST, as a result ebay would have collected roughly 4.95 in tax. Since IST charges are collected by ebay, we as  sellers are not responsible for refunding those charges. The buyer side paper work will no doubt list the refund as purchase price + shipping + IST . 

[kawartha-ephemera · Accepted solution]

The fact that the glass is now broken does not in any way influence the refund, it is the reason for the refund, that is all. The customer might have just as easily asked for a refund because of wrong colour, doesn't like how it looks etc. None of that matters whether the tax is refunded or not refunded.

The buyer purchased a glass.

The buyer agreed to pay shipping.

The buyer paid an IST

The buyer receives the glass, requests a return.

You the seller agree to refund without return.

The buyer is entitled to a full refund which includes;

purchase price + shipping + IST paid (collected by ebay)

At the end of the day post refund there is no IST payable to any party because in effect there was no purchase. The buyer could have just as easily ended up with a glass in perfect condition, she still would not owe any IST because her purchase price was 0.00.

[hallscrystal]

Thank you.  I appreciate all of the replies, it really helped.

[pjcdn2005]

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@lotzofuniquegoodies wrote:

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@kawartha-ephemera wrote:

Yes, ebay will refund the sales tax they collected making the buyer whole. The buyer may notice a small variation if you sold the item in CAD to a USA buyer who paid with a USD credit card.

---

Does it work the same way with the tax being refunded if it is a partial refund? Or are there options in MP do a partial refund? I believe it used process appropriately when a refund was handled directly in PayPal. Asking in advance so no surprises.

-Lotz

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Yes you can do a partial refund in MP.  I'm fairly sure that when you do a partial, the tax will be credited to the buyer with ebay.