XaiJu
Princess Weekes
Princess Weekes

patreon


Weird Sales Tax

I have been so behind on my emails because of my internet (which is *finally* working) that I didn't get a chance to post about this. If you follow other people then you know that Patreon is putting in this new tax system. I do not understand it really, but here is what I've seen on the FAQ and I'll link it here as well. Of course considering everything going on, make whatever adjustments you need to for yourselves.  <3 P


Should sales tax apply to Patreon? Is supporting a creator on Patreon the same as making a purchase?
The way these new laws were written, if a patron is receiving benefits in exchange for their pledge, the pledge may be subject to sales tax, depending on what is considered taxable in the patron’s location. For example, many places have passed laws that make streaming content taxable with platforms like Netflix and Spotify in mind. So in those places, streaming video and audio are considered taxable.

If the patron is not receiving any benefits, the pledge is not taxable in most places. For example, any pledge where the patron didn’t select one of your tiers, and any amount of money added on top of the tier cost is not in most places taxable. One notable exception is the EU, where we are currently required to apply tax (VAT) to all pledges regardless of whether the patron is receiving any benefits. We are working with EU tax authorities to secure reductions and exemptions for support-based pledges in the future. 

Supporting a creator on Patreon can be similar to making a purchase if the patron is simply looking for a way to pay money for content or tangible items you’re offering. But many patrons are also motivated by the idea of supporting content/art they care about. Since most memberships include both motivations, the new advanced tax settings we’re launching soon will allow you to tell us how much supporting your work is a motivation for most of your patrons. That allows us to reduce sales tax for patrons in places where tax laws allow us to do so. 


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