UpPromote events
Basic knowledge
Build
Recruit affiliates
Work with Affiliates
Referral order
Payment
Pricing plans
Guide for affiliate
Blogs
Tax on paid commissions
There are tax implications to consider when issuing commissions to your affiliates. Bear in mind that how much tax to pay and the way in which you pay them will greatly depend on where you live and work. In some regions (especially Germany and the EU), the tax rule must be strictly followed due to national tax regulation, so make sure you've done thorough research about tax rules in your country.
The merchants (you) can be the ones who pay the taxes or the affiliates pay themselves, to select a tax option in UpPromote, navigate the Settings tab => Payment settings, there's a section for Tax on paid commissions settings. In short, the tax information will be reflected on the paid transactions' information and the invoices exported by you and your affiliates.
If taxes on paid commissions are not required in your region, keep the settings to be None. Or else, you can whether choose if you pay the taxes or your affiliates do.
The merchants pay the taxes
When you select the Merchant pays option, the tax value will be accumulated with the total commission amount, which means the total paid amount will include the tax amount as well.
There are two ways to set up the tax percentage, which are A fixed percentage for all affiliates or the percentage entered by affiliates. A fixed percentage will apply to all affiliates who bring referral orders while the other options allow each affiliate to enter their own tax % (according to their regions).
If you allow each affiliate to enter a tax %, there will be an additional field on the payment settings on the affiliate account, the default tax % is 0, if the affiliates don't edit this value, then the tax will not be implicated on the payment details.
Once the settings are saved, the tax information will be displayed on the Payment tab before you process the payment as well as on the detailed information of the paid transactions. Additionally, if you enable the export invoice function, the tax information will be shown on the exported invoices as well.
Commission with tax before processing the payment
Payment details with tax value
Tax information on the invoice
Affiliates pay
When you select Affiliates pay, the tax value will NOT be accumulated with the total commission amount because it is included in the commission amount. It will only be shown in the paid transaction's details and the exported invoices as Tax (included).
Copy link