Is marketplace commission charged on the price with or without VAT?
By the TrueSellerPrice.com team · Published
A commission rate means little until you know what it is charged on. Fifteen percent of the price the buyer pays, VAT included, is more than fifteen percent of the price without VAT — and the difference comes straight out of your profit.
Four possible bases
Marketplaces describe their base in different words. In practice it is one of four:
| Base | What it includes |
|---|---|
| Item price incl. VAT | The price the buyer sees for the item |
| Item price excl. VAT | The item price with VAT taken out |
| Item + shipping incl. VAT | Everything the buyer pays for the order |
| Item + shipping excl. VAT | The order total before VAT or sales tax |
Some examples from marketplaces’ own pages: eBay.com charges its final value fee on the total amount of the sale, including shipping and sales tax. Amazon.com and Amazon.ca charge referral fees on the total price including shipping and gift wrap. Etsy charges sellers outside the US the transaction fee on the listing price including taxes. Kaufland charges on the selling price and shipping costs. Each marketplace page on this site shows the base we read and its source.
Worked example
A German seller lists a product at €49.90 including 19% VAT. The product costs €20 and shipping €5. The marketplace takes 15%.
| Commission on price incl. VAT | Commission on price excl. VAT | |
|---|---|---|
| Commission | €7.49 | €6.29 |
| Profit per order | €9.45 | €10.64 |
| Margin | 22.5% | 25.4% |
| Break-even price | €36.22 | €35.00 |
| Price for a 20% margin | €47.87 | €45.77 |
The rate is the same in both columns. Only the base changed, and it moved the profit by €1.19 per order — about 13%.
Why it adds up
VAT isn’t your money: you collect it and pass it on. When a commission is charged on the VAT-inclusive price, part of what you pay is a fee on the tax. At 19% VAT, a 15% commission on the gross price is the same as about 17.9% of the net price. At 20% VAT it is 18%.
How to check yours
- Open a fee statement or order breakdown in your seller account and divide the commission by the price. If the result matches the rate, the base includes VAT.
- Check whether shipping you charge the buyer is included.
- In the profit calculator, switch to Detailed and choose the base under Commission is charged on.