Bidding site real numbers

Discussion in 'Website Development & Design' started by brad1985, Oct 9, 2008.

  1. brad1985

    brad1985
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    All these huge companies that have bidding as their main income source are seemingly the hit of the century but what kind of problems do they face when talking about tax and disputes. Can someone help me out with this? I want to have my mind set on this game as real as possible.
     
  2. Fergal

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    Are you referring to companies like Ebay?
     
  3. brad1985

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    yeah, kind of that, but not like that, have you ever visit a site like elance?
    somewhat like that.
     
  4. pendelton

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    They are only taxed on the profits made. Money in dispute is not profit. It is not their money, it does not belong to the seller, nor the buyer.

    Paypal/Ebay make their profits from listing and transfer fees, big money from a lot of little transactions. Plus, I think that they are a bank in something like Luxembourg, so they are probably their own payment gateway.
     
  5. Fergal

    Fergal
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    Brad, I think that Pendelton has most probably answered your question.

    Are you considering setting up one of these sites? Your question is quite specific. The large companies you speak of will have accountants who advise them on tax returns and actually make the tax returns on their behalf. Even smaller companies will use an accountancy practice to tell them exactly how they need to pay their taxes for their specific business.
     
  6. brad1985

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    who does the money belonged to?
    a little confused, sorry I'm a bit slow.
     
  7. pendelton

    pendelton
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    That is what the disputes are all about Brad. Paypal will hold the funds in escrow until it is decided which party should have the funds. Funds in an escrow account do not belong to the company holding them, like escrow.com does not have claim to funds in it's system, as they are just holding them till the person, or business, is able to get them.

    Money in Paypal, like a bank, doesn't not really belong to them, but to the account holders. Fee's are deducted from all transactions, so they do own those, on all completed transactions. This is the money they 'earn'. Then add in the listing fees and you can generate some money.
     

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