What is VAT?
Value Added Tax (VAT) is a tax assessed on the value added to goods and services, including digital. It’s charged as a percentage of a price (e.g., $1.00 pledge with 23% VAT will have a final cost of $1.23).
In VAT jurisdictions, cross-border sales of digital services are increasingly subject to VAT in the customer's location, rather than the seller's location. This applies to sales by independent content creators, including those using Patreon.
How VAT works on Patreon
In jurisdictions where Patreon has an obligation to collect tax on customer sales, Patreon generally calculates and collects VAT from members and fans. We present and charge VAT at the applicable rate for your relevant members. We also take care of the filing and remittance of VAT payments we process.
Even so, each country handles VAT differently. For instance, please refer to our Mexican VAT & Income Taxes for specific details on VAT collection and payment obligations in Mexico.
We recommend consulting with a local tax advisor for issues such as:
- Potential VAT obligations if you cannot see VAT applied by Patreon on your sales of goods and/or services
- Confirmation that by using Patreon, you will not be required to register for and collect VAT
- Any local filing requirements you may have as a creator
How does Patreon collect VAT?
Members will have VAT added to their payments in jurisdictions where Patreon collects the tax. VAT charges are processed and remitted via Patreon – your earnings are in no way affected by the VAT we collect, as it’s in addition to the price for joining your membership. VAT will be listed and calculated for members when they get to the checkout page of the joining process or the one-time payment purchase.
The VAT rate members are charged depends on the location they’ve set in their Profile settings. If the member hasn’t provided this information, VAT will be applied based on their location at the time that they start their membership.
How can I keep track of VAT my members pay?
We keep track of the VAT collected from your members, categorized by country. Here’s how you can access VAT paid on your behalf:
- Log in to your creator account
- Click on Payouts from the left-side navigation
- Click on the Documents tab and scroll down to the bottom of the page
- VAT collected and paid for by your members will be listed in the Sales tax section
- Click the Download button to get a breakdown of sales tax, including VAT, by country
Your Sales tax section also includes a CSV table for any sales tax paid by members in the United States.