topic Re: Postage and people complaining about cost in Selling

Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 11:54:49 GMT

It been really eye opening reading so many people complaining about postage costs. The thing that gets me there must be alot of sellers running business like selling but NOT abn registered. If they were your postage is FREE no matter what it costs. As all postage costs are a tax write off for business. Just something to think about

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 11:56:17 GMT

Or very bad accountant's

Re: Postage and people complaining about cost

davewil1964 — Fri, 16 Oct 2020 12:06:07 GMT

Or no understanding of business.

Whether registered for an ABN or not, postage is not free. It is an expense, no matter how apportioned.

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 12:07:04 GMT

Yep it a expense but it a tax deduction for bussiness where it not for a private seller

Re: Postage and people complaining about cost

davewil1964 — Fri, 16 Oct 2020 12:09:07 GMT

@silver-fox-bullion wrote:
Yep it a expense but it a tax deduction for bussiness where it not for a private seller

It is if the private seller is declaring their income.

Nothing to do with an ABN, or GST registration for that matter.

Please stop trying to spread misinformation.

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 12:10:42 GMT

A business can write off postage cost as part of the earnings of the sale like the ebay fees etc. Which in turn see a business getting free postage. As above there must be some people using really bad accountants if the postage is not getting written off

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 12:13:03 GMT

Lol you may want to look up a few things as it clear you have no idea re postage costs and business and tax laws on what they can write off and not

Re: Postage and people complaining about cost

davewil1964 — Fri, 16 Oct 2020 12:21:28 GMT

I am not a business.

I do, however declare my income to the ATO.

Which means that my postage (and many other costs) are tax-deductible.

Regardless, offering 'free' (ie included) postage does not negate the expense, or the ability to claim a deduction for the expense.

If you want to play accountants, go for it.

You seem to have no understanding of tax law, for starters.

And it's not free. Even on the 30% bracket, (which a business pays) an expense reduces tax by 30%, so no expense is free, compared to not incurring it in the first place.

For example - I sell something for $10, 'free' post. It costs me $1.50 in eBay and Paypal fees, plus $2.52 for postage. So I make $5.98 less item cost (say $1.00), call it $5.00. I pay tax on that $5.00. If I charge $7.50 plus $2.50 postage, after expenses I make $5.00, which I pay tax on. Which means I make $3.50

If I was getting the postage for free, I would be paying tax on $7.50, and ending up with $5.25, but AP won't come to the party.

As above, you seem to have no understanding of tax law.

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 12:24:45 GMT

In bussiness it not classed as an expense for tax purposes but a write off that the difference between a private seller an abn holder. Again research

Re: Postage and people complaining about cost

davewil1964 — Fri, 16 Oct 2020 12:29:20 GMT

Gross profit, EBITDA, is gross profit, from which everything else is calculated.

Writeoffs are for reduced capital value.

I certainly hope you're not doing your own accounting.

And it's irrelevant, anyway. A business pays tax on their profits, just like non-ABN registered sole traders.

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 12:35:59 GMT

To make this simple if your buy a 8.95 postage label this is 100 percent claimable if I change 8.95 that free postage. If I charge 10 I have to pay tax on 1.05. Which more than likely would also be written off by packaging costs and ebay fees

Re: Postage and people complaining about cost

davewil1964 — Fri, 16 Oct 2020 12:53:58 GMT

@silver-fox-bullion wrote:
To make this simple if your buy a 8.95 postage label this is 100 percent claimable if I change 8.95 that free postage. If I charge 10 I have to pay tax on 1.05. Which more than likely would also be written off by packaging costs and ebay fees

You are correct. Sort of. Whether you show postage as 'free' or as a separate amount, it is still a deductible expense.

As it is for me, regardless, as I mentioned previously, of how I apportion the postage in my sale price.

And, just like you, it reduces my taxable income by $8.95, as it is a legitimate cost of running my business.

Any business pays tax on their nett profit. Which is income less expenses. The difference is that I don't have to charge or remit GST, but I can still claim GST on my inputs as an expense.

Re: Postage and people complaining about cost

*tippy*toes* — Fri, 16 Oct 2020 12:56:29 GMT

Oh great, Dennis Denuto is at it again. Please tell us which university you gained your law degree? Wasn't the University of Google was it? Or, where did you earn you Accountant degree? Probably the same university by the looks of it.

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 13:01:50 GMT

I see it went click re the free postage. Now back to the 1st post it eye opening the amount of people moaning about postage costs when if they were doing things above board there no cost

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 13:07:18 GMT

To tippy toes we are still looking into a few things re the double charging of gst that already been paid on byo postage watch this space

Re: Postage and people complaining about cost

*tippy*toes* — Fri, 16 Oct 2020 13:15:03 GMT

@silver-fox-bullion wrote:
To tippy toes we are still looking into a few things re the double charging of gst that already been paid on byo postage watch this space

Good Lordy, that TOPIC has been done to DEATH. Ya NOT being charged double GST on postage. Ya can go on believing it if ya like, but ya AREN'T.

Call the GOVERNMENT if ya THINK ya BEIN' ripped OFF. Or, better STILL, call the POLICE.

There IS something MORBIDLY satisfying about ADDING random words in UPPERCASE. I WISH I started this TREND.

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 13:18:35 GMT

The has called the ato and a couple other govt departments already they all to this point agree it a double charge of gst

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 13:20:53 GMT

As you can not charge GST on something that someone already owns. As ebay fee is clearly states it on postage.

Re: Postage and people complaining about cost

silver-fox-bullion — Fri, 16 Oct 2020 13:23:08 GMT

And they have not played a part in that byo postage so have not provided a service so from our calls so far they fail the gst test

Re: Postage and people complaining about cost

joz15au — Fri, 16 Oct 2020 13:36:28 GMT

Postage is indeed an expense for tax purposes in business just as it is for a private seller declaring their income in their tax returns. No difference. You seem to have changed your argument somewhat from the tax deductibility of the postage equating to free postage, to becoming free because you pass the cost on to the buyer, which will of course will have zero effect on your net income. I think most of the people who are concerned about the cost do not feel that they can increase charges to their customers and maintain sales, so in their case it does become an additional expense, and even with the tax deduction they will only recover an amount equivalent to their marginal tax rate. By the way I have been a tax accountant for 40 years and a very good one.