Weird sale earning value

3dmodels
#1

Hey, i´m a starter in this industry so i do not know somethings like taxes and that stuff but…
For example, i have sold an item for 8 $ it says that i received 2.88$ and then my earnings were 1.09$

How so? could someone enlighten me?

Thanks in advance

#2

$2.88 is your earnings, and the $1.79 is US withholding tax… leaving you with $1.09. You’ll see the details if you go to your statement page. Check out the article here which should clarify a few things…

Bottom line… US withholding tax is withheld on all sales at 28%, until you fill out a W8 form in your account settings. Then you’ll only have 0% withheld on non-US sales, and depending on where you live and whether you provide your foreign tax ID on the W8 from, you’ll have somewhere between 0 and 30% withheld on all US sales.

#3
  • you sold that item on 3DOcean before Author-Driven Pricing was active = 20% buyer fee
  • you are non-exclusive = 55% author fee
  • Envato has no taxpayer information about you = 28% backup tax on all worldwide sales
  • you have to pay the US withholding tax and the author fee on base of your gross income
  • gross income = list price - buyer fee

$8.00 * 0.20 = $1.60 (buyer fee)
$8.00 - $1.60 = $6.40 (your gross income)
$6.40 * 0.28 = $1.79 (us backup tax)
$6.40 * 0.55 = $3.52 (author fee)
$6.40 - $1.79 - $3.52 = $1.09 (earnings)

#4

Thanks, now how i understand how this works.

#5

Okay, humm but what if im not an US user?

#6

The advice above is for people who aren’t US users. If you were from the US, then the advice/info would be different.

#7

Oh humm, so would it be possible to get some more explanation about this issue? This is kinda hard to understand for people who are starting:S

#8

Pretty much everything you need to know is in the link above, but if you have any specific questions you need clarified, feel free to post them here.

#9

Will do, thank you :smile:

#10

For example, it says only if the buyer is an US person, that i will have a cut of % from tax. But in this example, the person that bought my item is from united kingdom.

Am i reading wrong?

#11

Envato has no taxpayer information about you (you don’t submited the W-8 form)
Without this taxpayer infos, Envato must treat you as an US-Author without any tax infos = 28% US Backup Tax on all your sales no matter of the nationality of the buyer.

I see you are from Portugal and Portugal has a double tax treaty with the USA of 10%.
Your options:

  • fill out W-8 form without foreign tax ID = 30% tax on US sales only
  • fill out W-8 form with your Portuguese Tax ID as foreign tax ID = 10% tax on US sales only
#12

Okay, so this w-8 form only needs my tax ID nothing more?

#13

Your tax ID along with some basic information about you. Go to your profile settings => Tax Information section, and there should be an online copy of the form you need to fill out.