Sale price - cost of item - eBay fees - PayPal fees - cost of postage - cost of packing materials = income.
For example, let’s say you sell CDs for $10 each, including shipping. You pay $5 for the CDs at wholesale. That’s $10 - $5 (cost) - 25c (insertion fee) - 52c (final value fee) - 30c (PayPal fixed fee) 29c (PayPal percentage fee) - 37c (stamp) - 50c (packaging) = $2.77 income.
For reference, eBay’s final value fee on a $10 item is 5.25%, while PayPal’s cut is 30c + 2.9% for most sellers. These numbers will vary depending on the value of what you sell and the kind of account you have.
When you work this out at the end of the year, you can calculate your overall price for all sales, and then work out how much of that you actually received, remembering to adjust for non-paying buyers. Then just subtract what you spent on shipping and packing. There’s no real need to do tax calculations on a transaction-by-transaction basis, although it is advisable to keep a printed record of everything you buy and sell.
However, there could be a few advantages to paying tax on your eBay sales – you might be able to make it back through deducting tax on your business expenses. All of the costs in the sum above that aren’t profit are business expenses and so tax-deductable. You may also be able to deduct the cost of any computer equipment you buy, as well as ink and paper for your printer. You could even try something a little unusual, like deducting the cost of renting your home office from yourself.
Whatever you do, though, don’t just rely on the information in this email. If you want advice about tax issues, you should really go to an accountant.Another way to make back the money you spend on tax, of course, is to simply make more profit on each item to begin with. Our next email will show you how to get more bidders with the power of pictures. Why Adding Pictures Increases eBay Bid Response.
Buyers really like pictures. The more pictures you have, the more they’ll feel like buying their item from you, and not from your competitor. In fact, there are plenty of buyers who will literally leave your auction within 5 seconds of arriving if they don’t find a picture there waiting for them.
A little extra work on photography can pay off massively, especially if you’re working on slim profit margins. But why is it so effective?It shows you’re serious. Sellers who take the time to take good pictures and present them carefully are surely more likely to go to the trouble of providing good customer service, and buyers know this, at least on a subconscious level. If you can’t even be bothered to take a photo and upload it to eBay, are you really going to pack their item properly? Are you going to post it on time?
It makes them trust you. Your buyers will feel more comfortable that you actually have the item if they can see that you have your own photo of it. It also reassures the buyers that your item isn’t a beaten up and broken piece of rubbish.
It makes your auction stand out. When your picture is displayed on the search results screen, people can see your item right there instead of having to read your title. People prefer to work visually, and are more likely to pay attention to a result with a picture.
But if you want the benefits of the response pictures can bring, then what should you do? Here are a few simple tips to make your pictures better.Bombard them with images. eBay might want you to pay for the privilege of adding more than one picture to an auction, but if you have your own web hosting then you can do it for free. Just take as many pictures as you want, upload them to your webspace, and then add them to the auction using HTML.
You might not know how to do this, but it’s very simple. Just write this in your description each time you want to insert a picture: <img src=”http://www.your-website.com/picturename.jpg”>