This article applies to:
- Beat Buyers
-
Beat Sellers
- Professional Plan
- Growth Plan
- Starter Plan
Overview
This article explains sales tax and Value Added Tax (“VAT”) on BeatStars subscriptions and beat & content sales (Marketplace and Pro Page), how fees appear on PayPal, and what this means for your records. Please see below for more information.
Frequently Asked Questions (FAQs)
Understanding Taxes and Fees on BeatStars
BeatStars collects government-mandated sales taxes on Marketplace, Pro Page, and Blaze Player transactions.
Any required sales tax or VAT is based on local laws and regulations for the buyer's location, and any such tax will be shown at checkout for the buyer. In addition, Marketplace transactions also include a 12% Service Fee. For more information on the Marketplace service fee, please see the following article: Why is there a service fee on the Marketplace?
PayPal combines the Marketplace Service Fee (when applicable) and all taxes, and labels this sum as a Partner Fee or Partner Commission. The collected amounts are then allocated as follows: the Service Fee goes to BeatStars, and the Tax or VAT amount goes to BeatStars and is then distributed to the proper tax authorities.
Buyers operating as a business in the UK or EU may receive a reverse charge VAT invoice in their BeatStars purchase receipt email.
IMPORTANT NOTE: If you were remitting VAT yourself as a BeatStars seller prior to April 1, 2025, you no longer need to do this.
Partner Fee/Partner Commission (PayPal)
On your PayPal invoice, the Partner Fee (also referred to as Partner Commission) represents the total fees associated with the order: the 12% Service Fee for Marketplace transactions, plus all applicable sales taxes.
This appears on the seller's PayPal receipt as the total costs deducted from the buyer’s payment.
Example: A Partner Fee of $3.20 includes:
BeatStars Service Fee (12% applied to the item price)
All applicable sales taxes
The separate “PayPal Fee” line is PayPal’s processing fee taken from the Gross Amount and directed to PayPal. For more information, see the PayPal Merchant Fees page.
IMPORTANT NOTE: For Pro Page and Blaze Player transactions, the Partner Fee only includes applicable sales taxes. BeatStars has never collected a Service Fee for Pro Page or Blaze Player transactions.
UK & EU VAT Compliance
To comply with UK & EU tax regulations, BeatStars collects and remits VAT on Marketplace and Pro Page transactions with UK & EU buyers according to UK & EU VAT guidance. Any applicable taxes are calculated and displayed at checkout. BeatStars then remits VAT directly to the relevant tax authorities using our VAT ID, not yours.
What does this mean as a Seller?
You do not need to collect or remit VAT for BeatStars sales to UK or EU buyers, and your revenue is not affected because VAT is added on top of the purchase price and paid by the buyer.
Since BeatStars is the VAT-registered seller of record, you should not report VAT on these BeatStars sales to your local tax authorities, which avoids double payment.
Do we get Documentation or VAT reports?
Individual yearly or monthly VAT reports are not provided to sellers, as BeatStars reports directly to tax authorities using our own registration, as the seller of record.
We are exploring ways to improve transparency, including clearer receipts for tax purposes.
Will my VAT be impacted?
Your personal VAT liability is not impacted. VAT is collected at checkout and remitted by BeatStars to local tax authorities.
Tax on Seller Subscriptions
BeatStars collects any required sales tax and VAT on Starter, Growth, and Professional subscriptions.
This is a regional tax and is not a price increase on the subscription plan. It is not related to sales you have made, and your revenue is not affected. The tax amount is shown at checkout, is distributed to relevant tax authorities, and is included in your purchase receipt.