My Price List US$ - Do They Pay GST

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11 years 9 months ago #24323 by Toast
I'm converting my price list to US dollars because I am sending it to a couple of outlets in USA & Dubhai.

If they purchase from me, do they pay GST? So should I be listing my wholesale price, plus GST & total?

Thanks.

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11 years 9 months ago #343862 by Anne
No. As long as they buy directly from you, they do not have to pay GST.

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11 years 9 months ago #343868 by ronnie
As long as the goods are being sent overseas, you deduct the GST portion then add freight costs.

Although I can see why you are doing this, it is a big risk to take if the currency exchange rates go the wrong way for you. I sent a quote to an Aussie customer a couple of weeks ago, in US $$ and she took 2 weeks to pay the account. In that time, the exchange rates had moved so much, I lost $10 on the sale, entirely due to the currency rates. Not very amused at all. As a % wise, that was a huge amount to loose on a small value sale.

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11 years 9 months ago #343888 by Toast
Thanks for that.

Yes, Ronnie, I know what you mean. You can't afford to lose that kind of money on small sales.

My plan is to send the price list in US$ & NZ$ but to explain that if they order I must receive the amount quoted in NZ$.

The reason I'm also sending the US$ is for their convenience. Northern Hemisphere people tend to relate to the US$. Also, it would be a lot of work for them going through & converting NZ$ to US$. In other words, I've done it for them.

Thanks.

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11 years 9 months ago #343897 by ame
In general they still pay GST, but the rate is 0%. This means in your accounting software there will be a GST line for every sale, but it will be for $0.00.

The IRD are well set-up for this and have some helpful information (here are two links I found very quickly):

www.ird.govt.nz/gst/additional-calcs/cal...-supplies/calc-zero/

www.ird.govt.nz/ecommerce-tax/ecommerce-...n-ecommerce-gst.html

You could also link the prices on your web page to a currency converter service to get an up-to-date estimate of the equivalent prices to display on line.

A

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11 years 9 months ago #343907 by Toast
Thanks, Ame. Does linking the currency converter cost extra?

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11 years 9 months ago #343914 by Kiwi303
www.xe.com is free.

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11 years 9 months ago #343918 by ame
There are dozens of different ways to do it. Here's a quick free one to whet your appetite:

www.xe.com/ucc/customize.php

Put yourself in the position of the customer. What do they (living in UK or US) need to know about ordering from you (located in NZ)? Make sure the website is clear. Make sure you clearly state that currency conversions are estimated and that each order is individually evaluated (if that is the case).

A

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11 years 9 months ago #343924 by ronnie
Sort of on the same subject - I have xe.com somewhere on my website for $$ conversions. I charge in NZ Dollars, and hope that is clear on my website. But I use paypal for processing credit cards so the payment shows up on their statement in US $$. This works very well for my international customers, but my NZ customers get a bit perplexed at being charged in US $$. But I also offer internet banking and accepting a cheque for my NZ customers. Plus, credit card processing thru Tradme. It's about as close as I can get to pleasing most of the people most of the time :)

But for any larger value orders, I use telegraphic transfer as the paypal fees are too dear. The TT costs the sender around $25 and me $25, but on larger orders, its cheaper than paypal fees.

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11 years 9 months ago #343939 by Kiwi303
As for NZ customers seeing USD on their Paypal... I see NZD when paying NZ people... It's all in your individual settings and if they change them form the US-Centric standard.

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11 years 9 months ago #343950 by Toast
Thanks for the links to free stuff. What I meant, am I going to get charged more by the web master (or whatever you call the people who made my website? I suppose I would be. I don't do my own website. There's nothing free down there!

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11 years 9 months ago #343956 by GrantK
It will be more complex to link your pages into a currency converter, so more work will be involved. However, you should look at it as a service to your overseas customers as it will make it easier for them to buy. Maybe ask your webmaster for a quote before deciding?

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11 years 9 months ago #343994 by ame
Who owns your website?
Who is permitted to work on it?
Would the original authors get a pod on if someone else edited your site?

A

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11 years 9 months ago #343998 by ame
Ok. I entered a bogus order. I can put items in my cart, and I can select in or out of NZ. However, this affects only the GST portion. It doesn't affect the net price. Anyway, once the order is complete the details are sent direct to PayPal, which is defaulted to NZD.

I think you need two things. One is that you need two prices for each item- the domestic price in NZD (which has a 12.5% GST component) and an international price in NZD, which has a 0% GST component. Second, you need to either let the user select their currency before submitting the order, and pass on the currency code to PayPal, or you need to not care about that and make sure it is simple and obvious for the customer to change their currency at the PayPal page, or offer a link to xe.com to let them get an estimate of the total in their currency even if they pay in NZD.

An easier way is to remove the drop-down box that affects GST and simply state that the price shown is inclusive of GST in NZ and net of GST outside NZ. Internally you still need two prices (domestic and international) and two tax rates (12.5% and 0% respectively), but it is (effectively) sheer coincidence that the gross price for domestic- or internationally-shipped items is identical. However, sometimes people like the idea that they are getting something cheaper because they are not paying the local tax.

Another option is to set up entirely new price lists for the US market and Dubai market. There is no absolute reason that the price there should be the NZD price x today's rate. You have chosen the price in NZ based on what the market will stand. Make up new prices for USD (using the exchange rate as a guide) and review them every quarter. Have a drop-down for each shipping destination and change the price lookup table (and GST rate) based on that.

Although I earlier alluded to the fact that you (or anyone you nominate) should be able to change your own website it is probably easier to get the original site designers to do this, if they know what they are doing.

A

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11 years 9 months ago #344006 by Toast
What does "..... get a pod on ....." mean?

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