Your eBay & eCommerce Questions Answered #59

Welcome Back!

It’s time for another Questions & Answers blog post.

This week we had an interesting post comparing prices on eBay and Amazon to test if Amazon’s buyers really are willing to spend more on the same products.

And next week I plan to publish an updated Best Products to Sell on eBay – 2016 UPDATE! The idea to update some of the most popular posts came to me as I went through my blog’s analytics data and noticed how many people read these posts every day. I think for such posts, The Best Products to Sell on eBay for 2013 being a perfect example, it’ll definitely be worthwhile to keep them up to date with the latest information.

But let’s get back to the subject at hand, today’s Q&A, and here are the questions we’ll be covering:

• Do you need to register a domain name together with hosting?
• What time management software do you use Andrew?
• Do you pay extra taxes when ordering from DigitalRev?
• How to make money dropshipping if you’re VAT registered?
• Do you have to cover return shipping costs for eBay orders?

Let’s get started!

Hi Andrew,

Thank you for all of the very helpful information on your website, following your advice I’m finding planning the set-up of my online business a little easier.

I have read your very informative write ups on image hosting and registering domain names, but I would like to clear up a little confusion please.

Would you recommend registering a domain name with a company such as Go Daddy and then using that domain name when signing up to an image host, Host Gator in your example?

Or

Registering a new domain name when you sign up with the image hosting site?

I’m inclined to register my domain name first and use that domain name with Host Gator, therefore using two separate sites. What would you recommend?

Many Thanks,
David

Hi David,

It doesn’t really matter where you register your domain name – both Go Daddy and Host Gator are big, reputable companies and you can trust your domain registration to either one of them.

The reason why I usually recommend registering domain names with Go Daddy separately is that:

1) They often have very good prices and special promotions on domain name registrations.

2) With Host Gator you can’t register a .co.uk domain name, something that most people based in the UK will want to get along with the .com

For these two reasons I have my own domains registered with Go Daddy. Sure, there’s an extra step of changing the domain name servers if your domains aren’t registered with your hosting company, but that takes just a few minutes and it’s all simple sailing after that.

Hope this helps David!

Hi Andy,

I was wondering what software you use for daily task management? As a business owner I constantly find I have numerous tasks to complete, all with varying time lengths and goals, so I would be interested to know if there was some software out there that could put all these goals/tasks into perspective?

Many thanks,
Mark

Hi Mark,

I know that there are many, many sophisticated time management tools/software out there but what I use is actually a simple Google Calendar – that’s it! I have it set up via the Calendar app on my iMac, iPad, iPhone, and MacBook so it synchronises everything. And basically I just plan my daily, weekly, monthly, and yearly tasks within the calendar.

For my daily schedule though I still use the same paper & pen method I covered in this post:

Set your Goals for the Year 2014!

I just much prefer to have a piece of paper in front of me with today’s tasks.

In the past I have tried some more sophisticated time management/productivity software and apps but at the end I always found myself spending too much time using and setting up the software itself and didn’t really see any productivity increase as such.

Each person is different though so if a simple calendar planning method doesn’t work for you, you may want to look into other solutions.

Hello Andrew,

I hope that you’re able to help me. I read your very useful article on import duty and VAT. I want to buy a Canon 80D DSLR; the best price is from DigitalRev in Hong Kong. I am wondering what UK Duty and VAT I might be liable for in addition to the purchase price. All their website says is:

8. Customs

By purchasing a product through the Site, customers outside of Hong Kong authorise DigitalRev Limited to make arrangements for clearance of customs on their behalf for the products they have ordered. When ordering goods from DigitalRev Limited, overseas deliveries may be subject to import duties and taxes, which are levied once the package reaches the specified destination. Any additional charges for customs clearance must be borne by you, unless an Import Handling Charge is included in the price of the goods. Customs policies vary widely from country to country, so you should contact your local Customs officer for further information. Additionally, please note that when ordering from DigitalRev Limited, you are considered the sole importer of record and must comply with all laws and regulations of the country in which you are receiving the goods. Your privacy is important to us and we know that you care about how information about your order is used and shared. We would like our international customers and customers dispatching products internationally to be aware that cross-border deliveries are subject to opening and inspection by customs authorities.

Thanks,
John

Hi John,

DigitalRev is a great company with very good prices. I myself have purchased camera equipment from them simply because their prices were the lowest available.

But yes, as they’re based in Hong Kong, you’ll pay VAT and import duty when the products arrive in the UK.

VAT is 20% but import duty depends on the product – it’s different for lenses, cameras, accessories etc.

You can find out the exact rate for each product you’re looking at following this guide:

How Import Taxes Can DESTROY Your Business!

Hi Andrew,

I’ve been doing some Amazon UK to eBay dropshipping for a month or two and things have started to pick up. My next step is registering as a sole trader but the big issue I see is with VAT, having to be registered with VAT and add it to my price once I reach the 82k threshold is detrimental to this dropshipping model, as I will eat up the 82k turnover mark pretty quickly and this will make my margins far too low for this to be worthwhile.

I pay VAT on the items I purchase from Amazon and notice that nearly all of the big UK dropshippers on eBay using the same model don’t have VAT numbers included in their listings.

Am I missing something? Is there a way to pay the VAT on my profit rather than my turnover which would give me space to make it work, or is it simply a case of HAVING to add VAT to my listings on turnover over 82K?

If so would it have to be a 20% VAT rate?

Any advice would be appreciated.

Regards,
Jonathan

Hi Jonathan,

No, there’s no way to just pay on your profit.

It will be 20% BUT you only pay HMRC the difference between what you get from your customers and what you paid your supplier (in this case Amazon).

For example – if you paid £10 VAT to Amazon when purchasing an item and got £12 in VAT when selling it, you only pay £2 to the government (i.e. the difference).

Plus when you’re VAT registered you can claim back VAT on business expenses, such as postal supplies, shipping etc.

Hello Andrew,

I sold some items to a buyer overseas and they opened a case to return 2 of the 3 items.

When the 2 items were returned I refunded the item cost but not the postage.

The buyer then sent me a PayPal request for postage and then opened a case for the payment of the postage.

eBay sent me an e mail to advise that the case was resolved in my favour and that I did not have to do anything else but the next time I logged on to my PayPal account there was a message saying “case needing attention”.

I phoned PayPal who agreed to close the case as I had received the items back. PayPal said that I DID NOT have to refund postage to the buyer. Now that has confused me as it conflicts with eBay always telling us that we must pay postage both ways?

Can you please clarify this for me?

Thanks for your help.

Louise

Hi Louise,

You only have to cover postage both ways for local orders, within the UK.

As it was an overseas order, the buyer is responsible for return shipping costs.

So it’s all good and PayPal/eBay did the right thing for you – you do not have to refund shipping for international orders both ways.

***

Okay, that’s it for today.

And not only for today…. next week’s Q&A post, our 60th Edition, will be the LAST one.

Yes, I have decided to stop doing Q&A posts in the current format. I will explain why in next week’s post but for now you can still send in your questions via the contact form on this page if you want to be featured in our final Q&A post!

Have a great weekend everyone! 🙂

Andrew