Sales tax

[jchap1022]

I’m a bit confused on this issue. Who actually is responsible for paying the sales tax on ebay transactions? The buyer? My “unwritten policy” as an ebay seller has been not to charge sales tax because I had never been charged as a buyer. Now, it appears you have no choice but to deal with sales tax. Does PayPal calculate the amount and tack it on to the purchase price? I tried to refund the sales tax to a buyer on a purchase but because the tax collected doesn't belong to the seller--instead the IRS or a state's internal revenue dept.--I wasn't able to. If sales tax is PayPal’s intention or policy, then the buyer should know what they’re paying for and how much. I don't see in ebay listings anything about the buyer being responsible for sales tax. It’s my understanding that some out-of-state businesses collect sales tax if they have a physical presence in the state where the buyer/customer resides. Some states collect sales tax; some don’t. I would appreciate having some clarification on the matter. Thanks

[sharpiemarker]

@jchap1022 

The law has changed. The buyer is responsible for paying the sales tax. Marketplaces such as eBay has to charge the buyer sales tax during checkout. The method of getting that sales tax to eBay to remit to the gov depends on how eBay has it currently set up with PayPal. The whole amount including sales tax could be paid to you and eBay bills you for it or during the payment processing the entire payment is split between you and eBay, with the sales tax amount going to eBay and all you receive is the amount for item and s/h per transaction.

Are you being deducted sales tax on the entire amount by PayPal upon receiving payment? Maybe they are deducting it and then remitting it to eBay?

Visit these page for more info: 

https://pages.ebay.com/seller-center/service-and-payments/tax-information.html

https://www.ebay.com/help/policies/selling-policies/tax-policy?id=4348

Or, do a web search on "ebay sales tax". The info is at our fingertips.

The sales tax info should not be on the item title, image or description itself but shown to the buyer during checkout along with item price & shipping/handling. Or, included in the item price where applicable.

[jchap1022]

Are you being deducted sales tax on the entire amount by PayPal upon receiving payment? Yes and no. Regarding the three ebay sales I've made this month, only one charged sales tax. I always print a packing slip to include with the item so that the buyer knows exactly what they've paid for. For this latest sale (Nov. 28), the sales tax shows up as a line item based on the purchase price. Now, sometimes I offer free shipping so I'm assuming the buyer is being taxed for just the item. In cases where the seller charges the buyer for shipping is sales tax applied to that as well? Regardless of the transaction for which sales tax is collected, that amount doesn't belong to the seller. It's not taken off the top of my sale either but it's obviously being charged the buyer. You can't remove or modify sales tax once it has been applied to the purchase. So, in the case of buying and selling on ebay, does PayPal/ebay automatically calculate the sales tax and add it to the purchase price? And is sales tax based on the buyer's residence or where the merchandise is located? You often see in smaller print on TV commercials the states where sales tax is collected when you place an order, and not every state collects sales tax although I can see states resorting to sales tax as a revenue generator.