Managed Payment Final Value fee Calculation

[bnorma01]

Just sold my first managed payment item.  The fee was slightly higher than I thought it would be based on what I was paying prior with PayPal.  The category was Toys so the final value fee percentage was 12.35% (plus .30).  The item sold for $20 so I expected the fee to be 12.35% of $20 plus .30.  WRONG its 12.35% of the total the buyer paid including sales tax so in this case there was 1.78 sales tax so 12.35% of $21.78 (plus .30).  STILL WRONG its is actually 12.35% of what the buyer paid plus the .30 cents so 12.35% * ( 20 + 1.78 + .30) = 2.73 plus the .30 flat fee so 3.03 is the fee.  So help me out here did PayPal include the tax in their calculation and did they include the .30 fee in the percentage calculation besides obviously charging the .30 ?  I feel like someone pulled some wool over my eyes some where...

[bnorma01]

I see now why the fees is larger than I expected.   WHAT A SCAM!!!  PayPal's 2.9% was also applied on the tax but it was not applied on the .30.  Further now prior the 10% ebay final value fee was only on the selling price (plus shipping charged) but not on the tax.  Now all the 12.35% is also applied to the tax so even though it would seem managed payments should be less it is not.  We are lead to think that the old 10% plus the PayPal 2.9 was 12.9 % and now the 12.35 percent is less well its not apples to apples given eBay now applies their entire percentage fee on the tax as well when prior only PayPal 2.9 included the tax in their numbers.   Also the fact that ebay applies the 12.35% in my case also on the .30 cents.  So long story short if you item has no tax managed payments might be cheaper but if your item sells in a taxed stated which most are then your fees will be higher !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

[buyselljack2016]

And still wrong. It's 12.55%   + $0.30😄

[buyselljack2016]

@bnorma01 

It was not a fee on the $0.30

The break even point before the .2 % increase to 12.55% n April was 5.82% sales tax. With that .2 % bump it is probably in the 6% area. Have not see anyone confirm the exact point, and I'm not smart enough, or care enough to figure out the exact %age.

I have adjusted my business model to compensate for the slight increase in fees from eBay/PP to eBay/MP.

A few pennies on the lower priced items, and a $, or $$ on the higher price items where the market will bear the increase.

I made out OK in April as I had some "no sales tax" sales, and had my fee refunded (except for the $0.30) when I did a buyer refund, and a buyer cancel. PP stopped refunding funds processing fees for many when there was refund, or cancellation.

[mam98031]

@bnorma01 

There was a fee increase effective April 1st of 0.20 in most categories for all sellers whether or not they are in MP.

This was announced in the Spring Seller Update released a month or so ago.

[mam98031]

@bnorma01 

I see now why the fees is larger than I expected.   WHAT A SCAM!!!  PayPal's 2.9% was also applied on the tax but it was not applied on the .30. 

Nor is it in MP.  I'm not sure where you got this from, but it is not correct.  This 30 cent fee is exactly like it was in PP.  We are charged 30 cents per transaction whether the transaction is worth $1 or $1,000.  The fee is the same, 30 cents.

As has already been discussed, the FVFs on Ebay increased April 1st.  MP now charges 2.35% for money processing fees and 10.20% FVF for most categories.  That totals 12.55%

Yes on most sales with sales tax we pay a little more.  For those sales that do not have sales tax we pay LESS in fees.  The thing to do is look at your fees for an ENTIRE month to see what the TRUE impact to your account is.  Looking at only transactions with sales tax will not give you the actual impact and only will make you mad.  I did a comparison for 6 months and found that MP is a pretty neutral change.  I actually do same a small amount most months, around 0.50% overall.  But I see that as a pretty neutral change.

[bnorma01]

Okay 12.55% works out although the 12.35% came directly from the eBay help line individual I spoke to.  They indicated a 12.35% final value fee given the item is under Toys and Hobbies but the help line individual must have been wrong which is sad.  I see in eBay's list of final value fees "Toys & Hobbies" = 12.35% but looking closer I think this only applies to the subcategory "Collectible Card Games".  I wish the fees had more details to them in my account and apparently more details are needed for the help line folks as well...

I am okay now other than their help line folks need a better education on their fees.

[releasethekraken_1]

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@bnorma01 wrote:

I am okay now other than their help line folks need a better education on their fees.

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And on everything else.

[mam98031]

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@bnorma01 wrote:

Okay 12.55% works out although the 12.35% came directly from the eBay help line individual I spoke to.  They indicated a 12.35% final value fee given the item is under Toys and Hobbies but the help line individual must have been wrong which is sad.  I see in eBay's list of final value fees "Toys & Hobbies" = 12.35% but looking closer I think this only applies to the subcategory "Collectible Card Games".  I wish the fees had more details to them in my account and apparently more details are needed for the help line folks as well...

I am okay now other than their help line folks need a better education on their fees.

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When I look at the fees page, it has been updated to show the April 1st change.

https://www.ebay.com/help/selling/fees-credits-invoices/selling-fees?id=4822#section8

@bnorma01 

[bnorma01]

44 "states" have taxes collected so guessing this will net out to a fee increase.  Oh well.

[mam98031]

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@bnorma01 wrote:

44 "states" have taxes collected so guessing this will net out to a fee increase.  Oh well.

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IDK if it will for you or not.  For me it has not.  For many other sellers it hasn't.  You won't know for sure unless you do some comparisons on ALL your sales for a few months.  You don't have to do it for future sales, you can do this for previous months.  Many of us have found it to be a pretty neutral change.   To assume is your right to do if that is how you wish to handle it.  For me, I like real numbers, so I compared my sales for a six month period.

I am no longer doing the comparison, but I am also not noticing a jump in my monthly fees since I've been in MP either.

Not all states charge the same amount for sales tax.  I think the average is around 8.5%

[releasethekraken_1]

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@bnorma01 wrote:

44 "states" have taxes collected so guessing this will net out to a fee increase.  Oh well.

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It's a small fee increase for sales to any state with a sales tax rate of 5.7% or more. It's a small decrease for the other states.

[urbancache]

Problem is they charge you fee for TAX,,,, sooooo wrong on so many levels.

How is this saving me money????

MANAGED PAYMENTS:

Collectibles fee is now 12.55% (was 12.35%)

ebay multiplies (sales total + shipping + tax paid by buyer) by 12.55% + .30 each transaction

example: $300 sale x 8% tax = $324 X 12.55% = $40.66 + .30 = $40.96 FEE

TOTAL PAID BY SELLER $40.96

PRIOR EBAY

ebay charged 10% total sale  + 10% total shipping

example: $300 x 10% = 30.00 FEE

PayPal charged 2.9% (total sale + tax).   $300 sale x 8% tax paid by buyer = $324 x 2.9% = $9.40 FEE

TOTAL PAID BY SELLER $39.40

[whatsupdoctoys]

Thank you for showing us a direct comparison with numbers.  I really puts things into perspective.

I think that the situation with FVF is even worse for a Hong Kong toys seller like me.

Maybe it's different for US sellers but for greater China sellers, eBay mandates that we open up a Payoneer account which will replace Paypal.  So, whenever I sell on eBay, the money will go directly to my new Payoneer account; they don't charge any fees until you decide to move the money out of this account (eg. transfer into my Bank account) where they will take 2% of the amount taken out.

Paypal fees ~ 5%, previous eBay fees ~ 10%, so total FVF ~ 15% for Hong Kong eBay sellers.

So specifically, 12.55% + 0.3 USD + another 2% if I want to have funds taken out of Payoneer.   So, eBay and Payoneer commissions (or FVF) works out to be a little over 14.55% for me per sale which is not very different from before, I think....but I'm new to all this so I could be mistaken.   

I was always under the impression that Paypal only calculated their FVF based on the listing and shipment price of the item sold on eBay (same as how I envisioned eBay calculated their FVF's), but after reading the eBay forums today, I found out that I've been too naive.

Your post made me aware of the fact that we are charged 12.55% on US sales tax.  Which, I agree with you that is not fair.  I don't understand the relevance of the seller needing to pay this tax which is collected by the individual States of America.  So, what does this tax have anything to do with a seller from Hong Kong I wonder?  Do retail (actual stores like Walmart or Sears, etc.) sellers and buyers in the States both need to Sales tax to the government for each transaction made in their stores?    I always thought that Sales tax was solely the responsibility of the buyer.   Again, I may be too naive.....haha.

[mam98031]

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@whatsupdoctoys wrote:

Thank you for showing us a direct comparison with numbers.  I really puts things into perspective.

I think that the situation with FVF is even worse for a Hong Kong toys seller like me.

Maybe it's different for US sellers but for greater China sellers, eBay mandates that we open up a Payoneer account which will replace Paypal.  So, whenever I sell on eBay, the money will go directly to my new Payoneer account; they don't charge any fees until you decide to move the money out of this account (eg. transfer into my Bank account) where they will take 2% of the amount taken out.

Paypal fees ~ 5%, previous eBay fees ~ 10%, so total FVF ~ 15% for Hong Kong eBay sellers.

So specifically, 12.55% + 0.3 USD + another 2% if I want to have funds taken out of Payoneer.   So, eBay and Payoneer commissions (or FVF) works out to be a little over 14.55% for me per sale which is not very different from before, I think....but I'm new to all this so I could be mistaken.   

I was always under the impression that Paypal only calculated their FVF based on the listing and shipment price of the item sold on eBay (same as how I envisioned eBay calculated their FVF's), but after reading the eBay forums today, I found out that I've been too naive.

Your post made me aware of the fact that we are charged 12.55% on US sales tax.  Which, I agree with you that is not fair.  I don't understand the relevance of the seller needing to pay this tax which is collected by the individual States of America.  So, what does this tax have anything to do with a seller from Hong Kong I wonder?  Do retail (actual stores like Walmart or Sears, etc.) sellers and buyers in the States both need to Sales tax to the government for each transaction made in their stores?    I always thought that Sales tax was solely the responsibility of the buyer.   Again, I may be too naive.....haha.

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@whatsupdoctoys 

Except @urbancache  wasn't totally accurate.  Very close, but the forgot a couple  little thing.  The FVF in Ebay should have been 10.20% not 10%.  PP also charges a 30 cent per transaction fee.  So in MP the fees for the sale they were talking about would be $40.96 and the same transaction through PP would have cost $40.30.

In PP it would have been as follows.

324.00 X 10.20 Ebay FVF = 30.60

324.00 X 2.9% PP fee = 9.40

That totals 40.00 plus a 30 cent transaction fee equals 40.30 total fees for Ebay and PP

I'm not an expert on the Payoneer fees, but it appears that 2% fee is when you are transferring the money to a bank in a different country.  Which leads me to believe there may be no fee if you transfer to a bank in the same country, but I'm certainly not sure.

So if you don't have any fee in Payoneer unless you are transferring your funds out of country, then your fees are the same in MP at 12.55%.  It is likely they pay Payoneer instead of you directly as someone has to be paying them for their services, they certainly aren't doing this for free.

https://www.payoneer.com/about/fees/