How are dropshipping taxes set?

Hello there,

I am based in New Zealand and would like to dropship but am confused over the taxes. What tax do i have to pay. I have got mostly Chinese suppliers and a few American suppliers. I dont imagine that many customers would be from New Zealand but probably America. I would like to dropship on eBay and maybe Amazon, maybe other sites later on but i will not be creating my own site.

Thanks for any help

Hi Stu,

When you're dropshipping, you work as a middleman for your customers and your (dropship) supplier. Any taxes charged to you by your dropshipper will have to be charged to your customer. Usually, the dropship supplier charge you with sales tax if you're based in the same location as them. In your case since you're in New Zealand, you will not be charged with sales tax. However, if your customer is in the US and your dropship supplier is in China, you may be charged with custom duties for importation. You will then have to pass on the charges to your customer so it's best to clarify the setup with your dropship supplier before selling their items online.

Hope this clarifies your concern.