Finance and Tax

Merchant of Record

We collect payments and tax on your behalf, but do not process the payment. We currently use PayPal as our payment processor, and will add additional processors and evaluate our existing processors on a periodic basis. Our payment processors collect and process payments, including sales taxes. For payment processing purposes, you will be the sub-merchant of record. Our payment processor will be the main merchant of record.

You are the seller of record and are responsible for maintaining and servicing your product listings, quality of your goods, and finance and tax reporting. With the exception of marketplace facilitator states, you are responsible for collecting and remitting tax in states where you have a tax nexus. We are not the seller of your products.

Getting Paid

After a customer places an order from your Facebook Shop or Instagram Shopping account and you mark the order as shipped, you'll be paid for the order within 2 to 30 days. We have a standard payout period of 5 days after payment is captured, but the payment hold period can vary depending on various merchant criteria. Our payment processor will pay you out through ACH on a rolling schedule. Payouts will go to a valid bank account that you have linked during set-up.

Your balance and payout history is available at any time in the Commerce Manager. You can create and download cash settlement reports for a given time window manually, or using our Reporting API. These reports have information on transactions like sales, refunds, chargebacks and payouts. You can download a sample cash reconciliation report below.

Report Type Link

Sample Cash Settlement Report

Download

Sales Tax

You are solely responsible for reporting and remitting taxes for sales that result from your Facebook or Instagram product listings. As part of setting up the Facebook Shop or Instagram Shopping account, we ask for your state tax registration number for every state you do business. By providing your state tax registration number, you enable the sales tax calculation to determine sales tax for products you sell through Facebook or Instagram. You must provide a state tax registration number for all states where you do business, except those that don’t impose sales tax.

For sales shipped or delivered to Marketplace Facilitator states, we must collect taxes even if you do not have a tax nexus in these states. We will automatically calculate, collect, and remit taxes to these Marketplace Facilitator states on your behalf in accordance with applicable law. No action is required in your set-up for sales shipped or delivered to the Marketplace Facilitator states. In report you will see tax we calculated, but both gross and net payment will exclude this value.

Tax rates depend on individual state laws and may vary state by state, they also depend on the category of each product in your catalog listing (via the google_product_category field). You are responsible for reviewing and determining the correct product category for your product listings. You can use our tax tool in Commerce Manager Tax section to verify our tax calculation logic.

You can also create and download tax reports in the Commerce Manager manually, or using our Reporting API. These reports include a detailed tax breakdown for each of your transactions. You can download a sample tax report below.

Report Type Link

Sample Tax Report

Download

Learn more about payouts and financial reporting in our Help Center.

Chargeback

You are ultimately responsible for chargebacks and the associated fees that are incurred if the chargeback is decided against you. When a chargeback is received, funds in your account will be placed on hold.

In the event that you do receive a chargeback, you will be notified and will be given an opportunity to dispute the claim. You will have 10 days from the date and time that the chargeback was received to respond to the claim. To dispute the chargeback, you will be asked to provide evidence that the transaction was legitimate and you fulfilled your obligations to the buyer. This may include proof of fulfillment, proof of refund, or other documentation.

If you do not respond or if the chargeback is decided against you, the amount requested in the chargeback along with any related fees will be automatically deducted from your account.

Learn more about chargeback representment in our Help Center.