[Update] Patreon And Required Sales Tax
Added 2020-06-26 20:27:02 +0000 UTC
Hey everyone,
Recently you may have received an email from Patreon explaining that starting July 1, 2020, you may be required to pay taxes on your pledges depending on where you live.
Thankfully, Patreon also gave creators tools to adjust tax settings on the backend so we could ensure you are taxed as fairly as possible. Over the last month I've been looking over options to make sure I'm doing right by all of you! Today I finished setting up the Patreon so that if you do happen to qualify for paying taxes, you won’t be charged any more than is necessary.
Again, these changes won’t impact everyone. It’s all dependent on where you live and your state or country’s tax laws. According to Patreon:
Less than half of all patrons will be charged sales tax, and for most, the amount will be very small. For example, sales tax rates in the US range from 4% to 11%, so on a $5 pledge, that would be between 20 cents and 55 cents.
Whether or not you will be charged sales tax depends on your location, and what is considered taxable there. Not every pledge is taxable, not all benefits are taxable in every location, and sometimes only a fraction of a pledge will be taxable. The money that Patreon collects as a result of these laws are paid directly to local governments.
My hope is that these changes don’t affect the vast majority of you, and for those impacted the changes are minor. If this does happen to put you in a tight spot regarding your financial situation, please take care of yourself and adjust and/or cancel your pledge accordingly. Times are tough and I’ll be happiest knowing you guys are taking care of yourselves.
Thank you for reading and for supporting, in the past, present, or future. I'm grateful to you, and to Patreon for making sure that all of this goes as smoothly as possible. If you have any questions feel free to message me or leave comments below.
Much love,
Megan
