MadamMateria
patreon
Taxes?
🕑 Added 2020-05-22 12:34:14 +0000 UTCAlright, so, Patreon seems to have placed it purely on creators to talk to their Patrons about their roll-out of taxes. Patreon has become required by international law to charge sales tax on Patronage, which, I mean, is fine. Sure. I really do not agree with the method of implementation, but I'm going to try my best (as someone good at math, not someone good at taxes) to explain it, as well as how I've chosen to set it up.
So, as of the other day, all tiers need to have listed benefits for the purpose of taxes. Even tiers like "Skulker" who's only thing is silent support, and the occasional preview. On top of that, each benefit needs to be filed into a category of what it is. This is because depending on where you live (you, the Patron) certain things may or may not qualify under sales tax. I... Obviously have no way of knowing these things. I would honestly prefer it if I could not apply taxes, because I don't really feel like I'm selling anything (which is technically inaccurate, I attach digital files to early access releases which does technically make those a sale), or that there was an option to just automatically deduct taxes from whatever someone's paying me. Keep the bill for the Patron the same, but my earnings docked for the tax. I can't do this, I can't even adjust my prices to account for the tax, because it's different depending on the country or state that you live in, not myself.
From what I can tell, Patreon are kinda being really skeezy about this, not only bucking the responsibility of informing users to individual creators, but, since I finished implementing the tax information into the tiers, even my highest tier Patrons have said they haven't noticed any change in the cost. So it's likely the tax may blindside a number of users. Creators also need to manually set the value of things for tiers with multiple benefits, with the default being just splitting every benefit value evenly among the cost of the tier. So... As an example, a Skulker's only benefit is previews, which falls under the tax category of "Early Access". Staff have five benefits, and are paying a significantly larger amount, and the default would say to tax the Staff on a value twenty times that of the Skulker, for the same benefit. There is no easy way to do this, the system doesn't recognize a benefit as being it multiple tiers, and adjust accordingly, everything is manual.
So, I have done my best to make this what I feel is fair, despite how much I despise this system. Price adjustment doesn't work, because everyone's tax values are different, but I think I've set it up so that the sales tax payed on each benefit should be the same across the board. With that said, I'm going to be transparent, and list each tier here, with the benefits, and what category they fall under, as well as the weight each benefit should be contributing towards the calculation of taxes.
Skulker
Previews (Early Access): 100% of 1$
Reader of Smut
Previews (Early Access): 33% of 3$
Exclusive Titles (Exclusive Posts and Updates): 64% of 3$
Moxie's Modders
Previews (Early Access): 20% of 5$
Exclusive Titles (Exclusive Posts and Updates): 40% of 5$
Moxie's Mods Voting (Exclusive Voting Power): 40% of 5$
Sponsor of Debauchery
Previews (Early Access): 10% of 10$
Exclusive Titles (Exclusive Posts and Updates): 20% of 10$
Moxie's Mods Voting (Exclusive Voting Power): 20% of 10$
Sponsor Credit (Patreon Recognition): 50% of 10$
Menagerie Staff
Previews (Early Access): 1% of 100$
Exclusive Titles (Exclusive Posts and Updates): 2% of 100$
Moxie's Mods Voting (Exclusive Voting Power): 2% of 100$
Sponsor Credit (Patreon Recognition): 5% of 100$
Staff Notice (Commissions (Digital)): 90% of 100$
As said, I've done my best, to the extent of math understanding I have, and the lack of tax understanding (I file my own taxes with a fill out form XP). As said, depending on where you live, your sales tax will be different, so this is fractions upon fractions. What this should do is essentially each benefit in a tier is only worth the additional value over the previous tier. So, if you live somewhere where Early Access is a taxable sale, it should always be only that 1$ that is taxed, no matter how much your total pledge is. Sharp eyed people may notice that Voting and Exclusives have the same tax percentage, it's because the jump between Skulker to Reader, and Reader to Modder, are both 2$, so I have essentially given them the same value.
If/when more tiers get added to the future, perhaps with different branches depending on the content I'm making at those times, I'm going to stick with this model. The value of any benefit is equal to the difference between the tier that introduces it, and a tier without it. I may end up needing to do things like split the Staff OC and the discount into two separate benefits at a later time as well, so this is by no means a permanent list, just what I have for now.
I'd like to point out, I also don't know how this applies to custom pledges, not that I have any, but just a point of interest. The FAQ for this whole tax nonsense was not only obtuse, only really saying "We have to charge taxes now, sorry lol!" and giving the estimates taxes for every country, but also, Patreon refused to allow me to sign into the support website. It just refused my password entirely, so not sure if that's cause I'm an 18+ creator and thus hidden by the system, or what. But if there was creator-specific access to information or assistance for this, I was denied it.
I'll reiterate it one more time, I think this is bullshit. I hope none of my supporters end up with a stupid amount of tax for my content, but I've made every accommodation I can think of while maintaining my ability to afford groceries.
Love you all, and thank you for your support through this.
- Madam Materia
