How does codecanyon tax works?

Envato Authors CodeCanyon
1

Someone just purchased my item “Nodepress” now on codecanyon for $35, and when i checked my earnings , i saw just $10, how come i have to pay $25 as author fee and tax, and will i be paying it like that per sale
pls i need someone to explain this to me

2

The price you see on the item page is the List Price
List Price = Item Price + Buyer Fee

On each sale you have to pay your author fee and perhaps US Withholding Tax.
Both are calculated on base of your gross income of a sale.

gross income = Item Price or (List Price - Buyer Fee)

I assume you have submitted the W-8 form for non-US-Authors, but you are from Nigeria and Nigeria has no tax treaty with the USA, so if someone from the USA now is buying your item you have to pay the US Royalty Withholding Tax (30% per sale).

JavaScript = $2.00 Buyer Fee
$35.00 - $2.00 = $33.00 gross income
$33.00 * 0.30 = $9.90 US Royalty Withholding Tax
$33.00 * 0.375 = $12.38 author fee
$33.00 - $9.90 - $12.38 = $10.72 earnings

If someone from outside of the USA is buying your item = no US Withholding Tax
$35.00 - $2.00 = $33.00 gross income
$33.00 * 0.375 = $12.38 author fee
$33.00 - $12.38 = $20.62 earnings

1 Like
3

Just understood how tax works now, but i really think codecanyon needs to do something about this, I cant be getting stipend when I’m selling at a comfortable price

1 Like
4

What would you suggest they do? This is United States law, not an Envato policy. Although, it shouldn’t be a very big issue overall, because this only applies to sales from the US; on sales from anywhere else in the world, you won’t have withholding tax.

5

If your country has a trade deal with the US, you can lower this tax or avoid it altogether.

6

Hi
Does the tax is calculated based on the payout country I have specified in the payment method.
If my country is uae does it include tax?
and how can I change my country on codecanyon!
thanks

7

For reducing US backup withholding tax (24%) you should to submit your TAX information form. If you submit the form with your TAX information then only tax will be taken for US sale and TAX percentage depends on your country.
US Tax Treaties:

8

does anyone know how I can contact codecanyon support team for payment requests?
thanks

9

Hi,

Please Contact Author Support and let them know. Support Team will be happy to assist you.

Thanks