eBay Fees With Free Shipping: What the Seller Actually Keeps

Free shipping changes the charge, not the shipment

For ordinary domestic US orders in the illustrated most-category fee band, eBay uses 13.6% plus $0.40 on orders above $10. The fee base generally includes item price, buyer-paid shipping, handling and buyer sales tax. Category, Store and shipping exceptions exist. eBay's official fee schedule.

When buyer-paid shipping is zero, there is no separate shipping charge to add. The carrier still expects payment. Keep three numbers on your worksheet: what the buyer paid for the item, what the buyer paid for shipping, and what you actually paid to ship.

Worked comparison at the same delivered price

Assume no tax, ads, insertion fees, discounts or seller surcharges, with $8 actual postage in each scenario.

The first two arrangements have the same fee and contribution. The third is an $8 price cut. After the smaller fee is allowed for, it reduces contribution by $6.91.

Do not treat the first seller's $8 shipping collection as money they keep while treating the free-shipping seller's label as an expense. Both sellers incur the same $8 postage cost in this example.

Follow the $45 order from revenue to contribution

With $45 item revenue, no buyer shipping charge and no buyer tax:

1. Percentage fee: $45 × 13.6% = $6.12.
2. Per-order fee: $0.40.
3. Total fee: $6.52.
4. Revenue after fees: $38.48.
5. After $7 postage and $12 goods cost: $19.48.

Now suppose the same order also carries an illustrative $3.60 buyer sales-tax amount. That tax does not belong to the seller, but it generally enters the fee calculation. The fee becomes ($45 + $3.60) × 13.6% + $0.40 = $7.01, rounded. Contribution after the same postage and goods is $18.99.

The sales-tax amount here is supplied as a scenario input. It does not establish the applicable rate for any buyer's location.

Set a free-shipping price from your actual costs

For a simple no-tax, no-ad order above $10, let C include goods, postage and packaging, and let G be your target contribution after those costs. Then:

Required item price = (C + G + $0.40) ÷ 0.864.

For example, if costs total $20 and the target is $15, the result is about $40.97 before cent-rounding checks. At $40.98, the fee rounds to $5.97 and contribution is $15.01. Recalculate if tax, ads, your category, or postage changes.

This is a target-price calculation, not a prediction that customers will pay that amount. Compare the resulting delivered price against your own achieved sales prices and margins.

Choose shipping presentation with measurable evidence

Record contribution and time to sale for comparable items. A free-shipping offer may change buyer response, but this guide assumes no guaranteed search or conversion boost. Check package weight, dimensions and destination before locking in a postage allowance.

Use the eBay calculator for its supported fee inputs, and complete the postage and tax adjustments manually. The general eBay fee guide explains how to choose the relevant category and avoid adding processing twice.