the way these laws were written and the way they’re being interpreted means that in many situations they apply to Patreon.
- Who will pay Sales Tax/VAT?
- About Sales Tax
- Details on Sales Tax
- Where is Patreon collecting tax, and what are the tax rates?
Who will pay sales tax?
Should sales tax apply to Patreon? Is supporting a creator on Patreon the same as making a purchase?
Different jurisdictions will consider different things taxable. If you receive a benefit in return for your pledge, it is likely that it will be subject to tax. For example, many places have passed laws that make streaming content taxable so in those places and platforms, streaming video and audio would be subject to tax.
It is also useful to remember that different jurisdictions approach digital content differently and what one country deems a benefit may not be consistent with the views of another country.
|Typical Benefit Type||Examples||U.S. Status|
|Donations/Support||Support only. Languages such as "pledges whatever"||Currently exempt from Sales Tax in the majority of states|
|Recognition||Shout-outs, names in credits||Exempt in the vast majority of states|
|Exclusive Community Access||Patron-only posts, Discord, server access, polls||Exempt in the majority of states|
|Streaming Content||Extra podcast episode per month, videos, bonus content||Taxable in roughly half the states|
|Downloadable Digital Goods||PDFs, computer game builds, downloaded color pages||Taxable in roughly half the states|
|Physical Goods||Candles, T-shirts, mugs, mailed coloring pages||Taxable in all states in which Patreon is collecting, unless the item is a one-time thank you gift|
An overview of the standard sales tax rates per jurisdiction can be found below:
|Country||What sales tax is called||Tax Rate|
|Canada (Quebec only)*||QST||9.98%|
|Canada (as of July 15, 2021)||GST||5%|
|Columbia (as of January 2, 2021)||VAT||19%|
|Malaysia (as of June 1, 2022)||SST||6%|
|Saudia Arabia (pending)||VAT||15%|
|South Africa (pending)||VAT||15%|
|Thailand (as of July 15, 2021)||VAT||7%|
|United States (36 states plus D.C.)||Sales Tax||ranges from 4% - 11%|
** Please note that Canadian provinces may add local tax in addition to the federal rate
|Country||Value-Added Tax Rate|
|United Kingdom of Great Britain and Northern Ireland||20%|
|States where Patreon collects sales tax||States where Patreon does not collect sales tax|
|Colorado||North Carolina||New Hampshire|
|District of Columbia||Ohio|
|Florida (as of July 15, 2021)||Oklahoma|
|Kansas (as of July 15, 2021)||Utah|
Canada - province/territory breakdown
|Newfoundland and Labrador||15%||15%|
|Prince Edward Island||15%||15%|