Providing a Tax Invoice for Paypal Payments

[toolman-online]

I dont use Paypal for listings of a high dollar value due to the high fees compared to my banks credit card merchant rate.

My discussion point is this and relates to providing a tax invoice to customers.

If I sell an item for $1100 ($1000 plus $100 GST) and the customer pay via Paypal I am likely to receive $1071.05 This amount has a GST component of $97.37

So when I issue a TAX invoice for $1100 on paper I have collected $100 GST but in reality it is only $1097.37 that I have been paid with a GST component of $97.37

Paypal do not issue me with a tax invoice for their fees so where is the $2.63 shortfall going ?

When I do my BAS I say that I collected $97.37

The customer is expecting a tax invoice that says he or she paid $100 GST.

Therefore when the buyer claims $100 as a GST credit meaning the Australian Government $2.63 out of pocket.

Do Paypal submit a BAS and pay GST and taxes ?

They should !

Does anyone want to comment ? 

[saarzi]

uhh actually many of us DO submit BAS, including myself (not for Ebay, but for my own 'day job' business, that has 5 methods of payment, incuding Paypal).  Its not an unusual or rare thing ya know.

Perhaps no one was understanding what you were saying because your original post wasnt clear, and its questions dont seem to be related to what you actually wanted to know?

Lets revisit them to be sure -

"Paypal do not issue me with a tax invoice for their fees so where is the $2.63 shortfall going ?

Do Paypal submit a BAS and pay GST and taxes ?"

These were answered.

"How much GST do you remit to the tax office ?  $100 or  $97.27 ?" 

This, I dont see in your original post.

Now you have re-stated what you are after, or invented a new question, I DO understand, and given the attitude, Im sure you can find the answer yourself.

[toolman-online]

Everyone seems happy to give an opinion here without fact and so far no-one can answer the last question without some doubt.

The answer I believe is that you pay the GST on what you receive as payment.

That being the case and if I provide the customer with a tax invoice showing GST of $100 (which they claim back) the government loses around $3 in GST

Added up over every business to business transactions thats a lot of money.

No-where did i say that Paypal need to pay gst but what I did say is that they dont provide any statement outlining the monies they take out and that your BAS is worked out on monies you receive.

Someone said that you can print this information out but the banks and proper financial institutions provide statements either on paper or electronically.

My ebay feedback reflects the way i do business and it shows my attitude and customer service

You dont see too many comments for bad attitude as does yours Saarzi

I started selling on ebay long before ebay australia existed (9 years for this id though)  so I have a fair idea how the sytem works

[digital*ghost]

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@toolman-online wrote:

The answer I believe is that you pay the GST on what you receive as payment.

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Yes, and you receive the full $100 in GST that the buyer pays. 

The fact that PayPal take their fees for processing the payment automatically and you never actually see it in order to remit it manually post-transaction, as such, doesn't change that. 

Treat the payments as though PayPal credited your account with the entire payment that the buyer makes, and then you paid them afterwards for their service. Buyer pays $1100, you received $1100, paid X amount in fees. 

Their statements do summarise their fees, BTW. 

[toolman-online]

Many Thanks digital ghost         

Many accounting packages use Banklink information provided by the banks to identify bank transactions such as deposits.

They calculate the GST collected.

They go by the amount deposited and calculate 1/11        

Jamie    

[digital*ghost]

No problem - I'm still a way off having to register for GST, and currently do all my accounting manually with a spreadsheet, so do not envy you the joy of figuring all this stuff out. 

[lyndal1838]

I submit a BAS for 2 businesses, neither of them being ebay.

You receive payments for $1100 with $100 of that being GST.   You declare that on your BAS.

When you do your tax you claim the paypal fee as a business expense.....it is not declared on your BAS during the year.

If your accountant is not declaring $100 as GST then you need to ask why....and then change your accountant.

[toolman-online]

Lyndal1838     Thanks for your input.                   

[westley2569]

Why am I out of pocket for a 16.00 dollar amount and I'm buying not on ebay

[padi*0409]

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@westley2569 wrote:
Why am I out of pocket for a 16.00 dollar amount and I'm buying not on ebay

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If you're not buying on eBay why have you dragged up a thread that's almost 3 years old to ask a question on the eBay forums ?????

[tashi911]

Are those little chinese shops who are charginf me 10% gst really paying this back to the aust govt or is it just free money for them