Taxed when buying with currency on account?

Vanstrom336 · Feb 17, 2015

It says I have 4.99 on my Microsoft account, and I'm trying to buy Costume Quest 2 right now, which is currently on sale for 4.95. It says that I need to pay the rest by credit card. I don't really understand, because on the 360 if you had let's say, $10
and you wanted to buy something $9.99, you could purchase it and have 1 cent left. You never got taxed unless you used a credit card. Do you really get taxed on things when paying with Microsoft currency you buy in stores? How do you even see the price that
the tax will come to? It should show that price, not "4.95" which turns out to be more.

:)

ngocphi · Feb 17, 2015

Being Taxed Twice To Buy Something on the Marketplace

Um you are only taxed once you aren't taxed when buying gift cards that's part of international laws

You get the exact amount you pay for in the gift card so there is no tax on gift card purchases

The currency will only be taxed At the time of purchase of the dlc

Unless you mean prepaid dlc codes from game stop those cards were probably made before the transition to currency

Then that would be on the old points system which took taxes into consideration

Agent Kei · Feb 17, 2015

Getting taxed on purchases

I live in Washington state and I had some points on my account that got transitioned into Local currency in June/July 2013? I purchased the walking dead 400 days in October 2013 and I got taxed on it. From my understanding points that were transitioned to
local currency should not be taxed. Here is a snippet from the xbox website.

Will I be taxed on the content that I buy in Xbox stores?

We will not apply taxes when you purchase content using currency that we add to your account at the time of the transition. However, when you use currency that
you add to your account after the transition (including from Xbox gift cards), all appropriate taxes will be applied to those purchases.

Now I spent over an hour and a half with support chat and they insist that the state will be taxing me for my purchases. If I'm not mistaken this is double taxation. I was taxed when purchasing the points and now I'm being taxed again purchasing the games.
Can someone tell me if this is right?

Smwutches · Feb 17, 2015

Yes, since the switch to the currency system you are now taxed on items, even on the 360. You would have to figure the tax based on what the tax rate is in your area.

Smwutches

Yes, since the switch to the currency system you are now taxed on items, even on the 360. You would have to figure the tax based on what the tax rate is in your area.

TrippIE

What that means is when Microsoft adds currency to your account which they did the first time. You would not be taxed for making a transaction. In the same link it states this

Will I be taxed on the content that I buy in Xbox stores?

We will not apply taxes when you purchase content using currency that
we add to your account at the time of the transition. However, when you use currency that
you add to your account after the transition (including from Xbox gift cards), all appropriate taxes will be applied to those purchases.

Sincerely,

Misses Joust

G'day Match!

This can vary from region to region based on local tax laws but here's the basic what-for:

Previously, taxes were applied when buying Microsoft Points. Example: I would buy 1600 MSP for $19.99 and a tax would be applied to that sale, but I would get the full amount of points. Those points were the product that you purchased, and then they would be
"spent" in exchange for goods on Xbox Live.

Now that MSP have been transitioned to local currency, "buying" that currency to add to my account is not taxed. Example: I will buy a $20 Xbox Gift Card and only pay $20 in the store, no taxes applied. But since I am using real local currency to buy products
on Xbox Live, those products are now taxed. So basically, the tax should be the same but it is being applied to the product rather than the currency.

Again, local tax laws can vary but this is my experience so far. I hope it clears up what changes have come along with the MSP transition.

ngocphi

No taxes on ms points

Or currency you get the exact Mount you buy

When you buy content the taxes are built into the ms points price listed not the gift card you purchased

So if you bought a game for 1600 ms points in Canada you need to buy 1400 ms points plus another 1400 ms points

Taxes are not included on gift cards. However when buying prepaid seasons pass you are just buying enough currency to cover the tax and dlc to buy what you need it is a convenient feature

You aren't being double taxed

Smwutches

It may have been a change in your area then, but when they switched to the currency system they did start having to add tax through the store. The only other thing I found may be related to the currency you had in the system if you still had currency from
before the switch. This is what I found on the FAQ about the transition to currency

support.xbox.com/.../microsoft-points-retire-faq

Will I be taxed on the content that I buy in Xbox stores?

We will not apply taxes when you purchase content using currency that we add to your account at the time of the transition. However, when you use currency that you add to your account after the transition (including from Xbox gift cards), all appropriate
taxes will be applied to those purchases.

Taxed when buying with currency on account?