Charging TAX

[skysteed]

I've been told that ebay now charges GST on items sold in Canada on final value fees. Why? I don't sell anywhere near $30K in a year.

[ypdc_dennis]

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@skysteed wrote:

I've been told that ebay now charges GST on items sold in Canada on final value fees. Why? I don't sell anywhere near $30K in a year.

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$30k in a 12 month period is the point when YOU are required to charge sales tax on YOUR sales.

Nothing to do with the sales tax that eBay now collects on fees. Prior to July 2017 eBay managed to sweet talk Revenue Canada into not having to collect GST.

-..-

[skysteed]

BUT, ebay is charging GST on postage. Already paying tax on this if required. I have been told that ebay US in now looking into this FRAUD!!!!!!!!!! Let's wait and see. I'm seriously looking into other methods of selling.

[ypdc_dennis]

eBay is NOT charging GST on postage. eBay charges a shipping fee based on what the BUYER paid towards shipping NOT on what the SELLER actually paid to ship. Then eBay collects GST/HST/QST on the eBay FEE for the government.

Might be annoying -- but it is not fraud.

[reallynicestamps]

The tax is on the Final Value Fee, which is charged to you for a service.

The GST taxes services.

If you sell something for $10 and the FVF is $1, you would pay a further 5 cents in GST.

And yes, those numbers are vastly oversimplified. I really didn't want to deal with PST/HST/QST questions.

And the buyer (you and I ) pay the tax. Not eBay. Just as you pay sales tax on a new dress or a restaurant meal or your monthly cable bill.

EBay avoided charging and remitting these taxes for years and finally gave in. They were not charged for the taxes they had avoided remitting for the previous fifteen or sixteen years.

When you work out your costs previous to setting your asking prices, you now have to remember the tax on your fees as well as the relatively new 10% fee on shipping charges.

If you are registered to collect and remit sales taxes, these new fees are business expenses.