How tax works on Ko-fi
Ko-fi is not the merchant of record on any transaction and isn't involved in processing payments, issuing refunds, or handling disputes. Ko-fi also can't give tax advice. Tax rules vary differently by country and state, so it's always worth creators checking in with a tax professional about what applies to them.
Income earned on Ko-fi is almost always subject to income tax and should be reported in the normal way creators report other income.
Ko-fi provides the tools to add sales tax or VAT to purchases. It is the creator's responsibility to calculate and remit the appropriate sales tax or VAT due on their sales.
Income tax
Tips, memberships, shop sales, pretty much anything a creator earns is likely subject to income tax. Rules on declaring this kind of income (especially tips) vary by country, so it's worth creators checking their local guidelines to see how to report it correctly.
Tip income is typically subject to income tax. Creators are responsible for reporting their tip income and paying any applicable income tax.
How creators get their tax reports
Creators have a few ways to pull together what they need for reporting. Creators on Ko-fi can download a full export of their payment history, including any tax collected, from the Payments and orders settings, at any time.
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Ko-fi creators can download a CSV file by navigating to Payments and orders and clicking the CSV button to download a full history of payments:
- PayPal users can access their here: 1099-K and other reports from PayPal.
- Stripe users can access tax reports here: 1099-K forms from Stripe.
Sales tax & VAT
Ko-fi works as a direct payment service — supporters pay creators directly into their own PayPal or Stripe account. That means Ko-fi doesn't collect or remit sales tax or VAT on a creator's behalf. It's up to each creator to figure out where they need to register, charge, and pay it.
What Ko-fi does give creators are the tools to add sales tax or VAT to their Shop items, Memberships, and Commissions, so they can stay on top of it without extra hassle.
How creators set up sales tax or VAT
- Go to More > Account & Billing > Sales tax.
- Add the locations where sales tax or VAT applies to the creator.
- Enter the percentage that should be added to the sale price.
Ko-fi will automatically add this tax to relevant orders at checkout. Creators receive the full amount — including the tax — directly into their PayPal or Stripe account, and it's the creator's responsibility to report and remit it to the right tax office.
Note
Just to be clear: sales tax and VAT are the creator's responsibility. Because Ko-fi isn't the merchant of record and doesn't process payments, Ko-fi isn't able to collect or remit tax on a creator's behalf. Ko-fi doesn't set creators' pricing or policies and doesn't manage refunds. Ko-fi's role is to give creators the tools to charge and remit the tax they owe, correctly and easily.
Do I need to add every location my buyers are in?
Not necessarily. This depends on each creator's setup. This includes where the creator is based, where they're registered to collect tax, and the rules in each country they sell to; all play a part. Different countries have different thresholds for when a creator needs to register and start collecting.
This worldwide VAT and sales tax guide is a helpful starting point, but Ko-fi always recommends creators check with a tax advisor for guidance specific to their situation.
We're here if you need us — feel free to send any questions our way. 💌