Hey, Patreon, fellow Creators,
so I’ve just completed a fun battle with the German tax authorities which was dragged out over the last 1.5 years.
Essentially, I’ve had bad luck and run into a local tax officer that did not understand what Patreon was, and the thing started to escalate from there.
To make the long story short, I have just been condemned to pay double-VAT for all funds collected through Patreon for the rest of eternity.
The VAT that Patreon collects from my Patrons and remits via VATmoss has been rejected and deemed ‘not applicable’ in my case. So it is collected for nobody, and vanishes in the void of the EU tax system, benefiting… nobody? Don’t ask me how this is possible, I don’t write tax laws. :T
Patreon’s legal team tried to help me by drafting an explanatory letter as to why VAT is handled by Patreon the way it is, under which EU directive, and that there cannot be made exceptions for individual creators.
This, too, has been rejected by the German tax authorities. “Not applicable” and “Patreon has no right to do it on your behalf.” Oh-kay.
My tax accountants say that the only way to appeal this is to start a lawsuit on an EU-wide level. Chances of winning that for me are below 50%, and needless to say I will never have the money to afford the lawyers and legal fees needed for this.
So I’m putting this here as a… Warning? To Creators from Germany.
If you have slipped through the net so far, and had the luck to deal with tax officers that knew what Patreon was, or didn’t care much about VAT - lucky you.
If you want to make sure to be on the safe side, put aside thousands of euros per year in case you will be forced to pay VAT for your income in retrospective.
Patreon - it may be best if you put a little notice on the VAT info page in your help section that the way VAT is charged and remitted by Patreon may not be accepted in Germany.
I’m not sure how I’ll explain to my Patrons that they’re charged VAT for no reason now… any ideas?