Recently, I wished to purchase a small, used auto part from the UK. At E-Bay's checkout, I noticed that a GST amount had been added to the total sale price. I refused to proceed with the purchase because of this illegally levied tax. When in Australia, did anyone ever had to pay GST on used auto parts?
OP, you may not have been aware that GST is payable on second-hand items in Australia, but it is – if the seller is GST-registered. (Businesses with a turnover of $75,000 annually are required to be registered for GST.)
If a seller in Australia is a business reaching less than that $75,000 turnover (gross), then no GST requirement - and it’s irrelevant whether that seller is selling new OR secondhand. For a private seller just selling parts off their own wrecked car, that is likely to be the case, so you’d not be paying GST for such purchases.
For the record, it’s irrelevant whether a local Australian seller is selling on eBay or on Gumtree or Facebook Marketplace or at swap meets or in a shop or through its own website. If the TURNOVER (not profit, but turnover) reached the $75,000 threshold, GST must be collected and remitted to the ATO.
But… eBay and other electronic distribution platforms don’t get involved in doing the collecting of GST from buyers if it’s a domestic eBay purchase (that is, in Australia, between Australian buyer and Australia seller).
If you’re buying (as an Australian buyer) from an overseas seller on eBay, then you will be paying GST. New, secondhand, it doesn’t matter. Hobby seller, private seller, big business, it doesn’t matter. That is because the relevant Australian legislation has specified that the EDP (electronic distribution platform) is the one responsible for collecting the GST. Amazon, eBay, Etsy, etc, they are all EDPs for the purpose of the legislation.
Perhaps with the continual mention of the $75,000 threshold - an explanation is warranted.
If gross is more than $75,000 - a Tax Invoice is issued - this includes GST added.
This enables businesses to offset the cost of running a business and the GST collected.
ie - A Carpenter - petrol - vehicle - tools - supplies - right down to nails - a Painter - petrol - vehicle - paint - tools etc etc etc - all purchased having GST included - every receipt retained.
Presented to the ATO - is the GST collected - MINUS the GST spent - on running the business.
Under $75,000 - an Invoice is presented.
This is the cost of the work - service - whatever - with no claims on paid GST - ie - supplies - tools - vehicles etc etc etc.
GST is included in everything - well almost everything.
That is absolute rubbish. I have never, in my whole life (age 82) ever, paid GST from any sellers large, small, GST registered or not, for used auto parts. Your comment is as ridiculous as it is misleading - Ebay Australia does not levy GST on the sale or purchase of used auto parts.
considering the subsequent replies you have received, I think you owe me an apology (man up and apologise).
The content of my post is consistent with the information provided by others . . . including the post you have marked as a solution. It just wasn't as detailed, BUT WAS FACTUALLY CORRECT.
I didn't have the time to go into great detail as I have other more pressing matters that I am dealing with at the moment. I've been busy all day and only just came back to this thread.
Here's a little more detail, seeing as you claim to have never paid GST on used motor parts:
- I call BS on the claim you haven't paid GST as the prices you pay in Australia for used parts IS GST INCLUSIVE (as required by law)
- used parts sold on eBay in Australia by GST registered businesses are priced GST Inclusive
- unless the eBay business provides a tax invoice then the letters "GST" might not appear on any eBay receipt or paperwork you receive. This does not mean you have not paid GST on used items
- if you have bought parts, in person, from a used parts establishment they might be running 'cash' sales and not forwarding GST to the ATO
- next time you are buying used parts from a business you should ask for a receipt that shows the GST component of the sale. If they don't give a receipt you can be pretty sure it is an 'off the books' cash sale
We were also discussing the ATO and GST generally weren't we? So, I was referring to sales of used items on Ebay in Australia, where Ebay Aust, does not add GST to sales? Why is that do you think?
hey, me again. It is not a matter of what anybody thinks, it is a matter of what the applicable rules and obligations are under the GST legislation.
Are you looking for like-minded opinions or factual information? (you know what they say about opinions, don't you?
I am no lawyer, but I understand it! I find it quite simple and straightforward to understand.
eBay do not add GST to sales in Australia because prices of goods in Australia, for both eBay Buy-It-Now and eBay Auctions, are GST Inclusive (where GST is required to be charged).
eBay is not legally required to be party to GST collection as the seller, where legally required to collect GST on sales, has the obligation to be GST compliant.
** On a side note, it is at times like this that I miss lyndal1838. She knew all about GST, and she was older than the OP!!!! **
As you say, k1ooo, eBay don't automatically add a GST component to sales within Australia. They'd be in hot water if they did.
You've explained it exactly: prices on eBay.com.au are GST-inclusive where GST is payable. For big businesses in Australia (or any business/seller with that $75,000+ turnover), they'll have the GST-incl. price as the listed price on eBay. We - the buyers - will probably not even realise that we are paying GST. For transactions with smaller businesses below the threshold, GST isn't payable, and the listed price will simply be the price set by the seller without GST entering the picture at all.
None of the international sellers on eBay do any collecting and remitting of the GST if they sell to Australian buyers. It's all done by eBay, whether or not the eBay seller has that $75,000 turnover to Australian buyers.
My reading of the legislation is that those who drafted it wanted to close as many loopholes as possible. Strictly speaking, if we compare domestic purchases to international purchases in terms of taxation, we should not be paying GST on items from overseas sellers (even if they're selling on an electronic trading platform) if the sellers don't have a $75,000 turnover minimum to Australia - but you can imagine the nightmare of checking and enforcing EVERY SINGLE SELLER from overseas, to ensure that they are not above the threshold, if the low-value imported items are being purchased without GST entering the picture. The very likely outcome in such a case would be almost every seller claiming to be under the threshold, Australian customs not having anywhere near the manpower and time and other resources to check the goods, and effectively the GST on imported goods becoming far too unwieldly and expensive to put into practice.
(However, if the eBay seller has their own store, from which lots of Australian buyers purchase - over the threshold - they would be responsible for collecting the GST and remitting it to the ATO. If their Australian turnover is below that amount, GST isn't payable and they'd be as happy as a child at the fair in not having to bother about the paperwork or the matter of collecting and remitting to the ATO.)
Ah... if the buyer thinks to circumvent paying the GST for an overseas eBay purchase by specifying a freight forwarding company's address (so that the item's sent to, say, a US address, where the parcel forwarding company receives the parcel and then ships it to the Australian buyer's address), the Treasury Laws Amendment for the low value imported goods has that covered as well. In that case, the freight forwarding company is responsible for collecting the GST on that purchase, not eBay. In fact, not only must the freight forwarder collect GST on the purchase price itself (goods + domestic delivery within the US, for instance), it must also collect the GST on its own fee for international shipping (including fuel surcharge, insurance, any import costs, etc.) to the buyer's Australian address.
These amendments have us trussed up and hoisted onto the ATO's spitroast - for those who buy from overseas sellers.
