Onlyfans VAT hit: Alternatives? solutions?

[Olive]

All companies have had to pay VAT for sales made to EU customers since 2015.

VAT has to be paid on every transaction a customer does. If tokens are used the transaction is considered to have taken place when the tokens was bought so that is when VAT should be paid since tokens are not considered a currency. If a video is bought with a real currency then that is when the transaction takes place and VAT should be paid. Whether it is a VOD, a subscription or an appreciation tip doesn't matter as soon as a transaction takes place the site should pay VAT.

Factually incorrect. VAT doesn't have to be paid for everything. There are many exceptions.

I.e. In my country waiters who get tipped do not need to declare VAT for those tips and the customers do not pay VAT on top of those tips nor do the restaurants.

How is that different from tipping for the service a model has provided on a camsite?

I agree about selling 'things' like videos, but that's not the main business on a camsite. At least not on CB.

Anyway, the VAT discussion is a sidenote to the original post.

Alternatives to OnlyFans are aplenty:
-AVNStars
-JustForFans
-AdmireMe
-FanCentro
-iWantFanClub

Possibly:
-locals.com (not 100% if they are adult friendly, but they appear to suggest anything goes unless its illegal + US based)

 

[Danigirl]

And I thought US tax was complicated...

 

[Nigerian Prince]

Factually incorrect. VAT doesn't have to be paid for everything. There are many exceptions.

I.e. In my country waiters who get tipped do not need to declare VAT for those tips and the customers do not pay VAT on top of those tips nor do the restaurants.

How is that different from tipping for the service a model has provided on a camsite?

Each country will have some sort of legal definition as to what constitutes tipping, and I highly doubt tips on camsites would fall under that definition. Especially since most models make tip menus with the expectation that members tip them to perform actions on those menus.

 

[AmberCutie]

Each country will have some sort of legal definition as to what constitutes tipping, and I highly doubt tips on camsites would fall under that definition. Especially since most models make tip menus with the expectation that members tip them to perform actions on those menus.

I guess what @DJ_Pioneer was saying is that in the case of tokens (for tips whether for tip menu items or "just as a tip") the transaction is paid for when they buy the tokens from the site, NOT when they tip them to the model.

 

[Nigerian Prince]

I guess what @DJ_Pioneer was saying is that in the case of tokens (for tips whether for tip menu items or "just as a tip") the transaction is paid for when they buy the tokens from the site, NOT when they tip them to the model.

That's a good point, but in that case I'd argue that models are paid by the site on a bi-weekly basis, not when members tip.

 

[AmberCutie]

That's a good point, but in that case I'd argue that models are paid by the site on a bi-weekly basis, not when members tip.

Not sure it’s even necessary to state that? If then only transaction relevant to VAT is when the customer buys tokens that’s all matters. Right?

 

[Nigerian Prince]

Not sure it’s even necessary to state that? If then only transaction relevant to VAT is when the customer buys tokens that’s all matters. Right?

Oh, I think I got mixed up because you quoted my reply to Melody and I didn't realize you were talking about DJ's point instead of hers

 

[DoD404]

It’s not a spin, it’s the practical reality. Members pay 12, we get 8. That’s 60%

67%

 

[Mila_]

Can someone more knowledgeable about European tax law correct me if I am wrong or explain this point better to me?

I read online there is a threshold of earnings a company needs to reach before they have to start collecting tax for the state in the EU and I read it’s 90k per month. Does this mean that if models themselves had a platform independently... say I created my own micropayment site, I wouldn’t have to charge VAT straight up to the members until I make 90k per month, yet OF does because they as a company do earn more than that monthly?

I realize I would have to pay VAT myself after anyway but I want to be clear on how and when this has to be done. Maybe I should find a tax consultant

 

[DoD404]

Not sure it’s even necessary to state that? If then only transaction relevant to VAT is when the customer buys tokens that’s all matters. Right?

Right. Also, as model, thank them to not be implicated more in VAT collection process. It's a chance that you don't have to do this work to collect it by yourself and redistribute to different country's VAT services as do all other service company dealing with foreign countries

I realize I would have to pay VAT myself after anyway but I want to be clear on how and when this has to be done. Maybe I should find a tax consultant

Actually, you would have to "export" your content and services using custom facilities. The mechanic depends on your own country though.

Another point about the notion of "tip". Waisters' tips in restaurants and bars are generaly not assimilated to paid service as it has been hardly discussed with gvt, it's an huge exception because restaurant and bars *employ* them but tips are their main revenues :/ Here, the model uses the site's service and acts as an independant worker. Buyer buys tokens or subscribtion to the site.
The site exports the service (or the tokens) and model is not concerned.

OF does because they as a company do earn more than that monthly?

I think yes. They 'do corrections' on big accounts... You would not be targeted but you would be outlaw : )

 

[Mila_]

After a separate conversation I have had with someone on this subject, I am starting to realize the reason that @Mila_ and I were disagreeing so harshly is that we were making different points without realizing it. I think, at least.

So sorry for the 'k' as that was my quick emotional reaction to completely being unable to argue what I thought was a valid point with someone I actually like. Hence me still thinking 'bout it. (I have no problems brushing off a failed discussion with people I don't feel so warmly about. )

Anywho... My ultimate point was Onlyfans is still paying out 80% to us. Their platform offering is that they give us 80% of WHAT WE ARE CHARGING on our page. If I price something at 10, I'm still getting 8. If the original points were that we are making less of a % of WHAT THE MEMBER ACTUALLY SPENDS then of course, that's the technical facts.

But I am confused about something that maybe someone more well versed in VAT could help with: we've seen a post in MO about OF sending a payout with an extra amount with (VAT) next to it, as if WE the models need to pay it...

Example with amounts censored due to it being from models only even though it doesn't give any identifying info...
View attachment 84884


On another note: as far as the article people are up in arms and sound like they're quitting Onlyfans over: https://news.sky.com/story/onlyfans...an-three-years-worth-of-unpaid-taxes-12022345 it says right there in the article that OF is not worried about any adjustments/payments they're going to have to take care of to rectify their situation.

I think people jumping ship because they think the site is going to tank is silly. It's justifiable to think maybe some of your more tightly budgeted EU fans may need to re-evaluate their subscriptions or spending but IMO the only reason to completely panic is if over 50% of your subscribers are tightly budgeted EU fans.

Hey it’s cool, even friends disagree sometimes and things can get a bit heated. No biggie.
I think I feel both responsible and deserving for my subscribers in the case of Onlyfans cause I brought them to the platform and for many the only reason they sign up was so they could see my content... and it sucks to have to either give them 20% less for what they spend or cut my own prices by 20% to offer them the same service I was for the same budget. I realize many members are subscribed to many girls and rather than spending less on my content they will drop other subscriptions they aren’t as interested in instead... which would be cool for me but not so cool for them or for the smaller creators. I suspect this will have an unexpected effect where top earners like me will earn a little less or about the same and small earners will have a harder time growing and earning than before making the gap wider. It’s a sucky situation all around..

 

[DJ_Pioneer]

Factually incorrect. VAT doesn't have to be paid for everything. There are many exceptions.

I.e. In my country waiters who get tipped do not need to declare VAT for those tips and the customers do not pay VAT on top of those tips nor do the restaurants.

How is that different from tipping for the service a model has provided on a camsite?

I agree about selling 'things' like videos, but that's not the main business on a camsite. At least not on CB.

Because the tipping occurs online through a site VAT has to be paid, if you don't have a company of your own and are tipped directly either in person or through an e-wallet such as PayPal (Don't use PayPal) you don't have to to pay VAT, but you might have to declare it as income depending on which country you live in.

Each country will have some sort of legal definition as to what constitutes tipping, and I highly doubt tips on camsites would fall under that definition. Especially since most models make tip menus with the expectation that members tip them to perform actions on those menus.

Yes and that it is online also matters.

I guess what @DJ_Pioneer was saying is that in the case of tokens (for tips whether for tip menu items or "just as a tip") the transaction is paid for when they buy the tokens from the site, NOT when they tip them to the model.

Exactly, tokens might as well be monopoly money as far as tax collectors are concerned. They are only care about real money, how we aquire it and what we do with it.

 

[Mila_]

Anyway, the VAT discussion is a sidenote to the original post.

Alternatives to OnlyFans are aplenty:
-AVNStars
-JustForFans
-AdmireMe
-FanCentro
-iWantFanClub

Possibly:
-locals.com (not 100% if they are adult friendly, but they appear to suggest anything goes unless its illegal + US based)

Has anyone tried both Onlyfans and these sites and can maybe compare them or do a pro/con list? Just exploring possibilities here...

 

[DJ_Pioneer]

Can someone more knowledgeable about European tax law correct me if I am wrong or explain this point better to me?

I read online there is a threshold of earnings a company needs to reach before they have to start collecting tax for the state in the EU and I read it’s 90k per month. Does this mean that if models themselves had a platform independently... say I created my own micropayment site, I wouldn’t have to charge VAT straight up to the members until I make 90k per month, yet OF does because they as a company do earn more than that monthly?

I realize I would have to pay VAT myself after anyway but I want to be clear on how and when this has to be done. Maybe I should find a tax consultant

I depends on which country the customer is in, it varies from no VAT exemption (Netherlands and Spain) up to 85,000 GBP (UK).

 

[Olive]

I depends on which country the customer is in, it varies from no VAT exemption (Netherlands and Spain) up to 85,000 GBP (UK).

Yes differs per country. Since the 1st of January this year there's the "KOR" in the Netherlands and you're excempted from VAT if you stay under 20k earnings a year if you partake in this. Only need to start asking for VAT from customers and declaring VAT if you surpass this.

The tricky thing with doing such a thing yourself is that you need to ask different VAT percentages per different country from different people. So you need to ask their country, which some people might not be willing to share to an "individual" vs a known company. There are some automated services that help with asking the different VAT % though. Those are for instance used by people that have online shops, so it's not impossible.

 

[Olive]

Also excuse the DP, I mentioned Fancentro in an earlier post, but thats for automated selling access to your socialmedias.
The same company also offers Modelcentro where you can make your own website with your own branding and sell subscribtions for access to your content.

I personally have toyed with the idea of doing something like OF but as an independent. There's a lotttt of things to consider with that though, which really makes one understand why the providers take the % cut that they do.

 

[DJ_Pioneer]

Yes differs per country. Since the 1st of January this year there's the "KOR" in the Netherlands and you're excempted from VAT if you stay under 20k earnings a year if you partake in this. Only need to start asking for VAT from customers and declaring VAT if you surpass this.

The tricky thing with doing such a thing yourself is that you need to ask different VAT percentages per different country from different people. So you need to ask their country, which some people might not be willing to share to an "individual" vs a known company. There are some automated services that help with asking the different VAT % though. Those are for instance used by people that have online shops, so it's not impossible.

If you start to handle transactions of that nature you will likely have had to start your own company anyway to be able to deal with credit card companies or payment processors. And if you start handling credit card information customers will have to state their country because there is a bunch of banking regulations concerning money laundering that needs to be complied with, if a payment processor is used they will ask.

 

[Just_A_Guy]

Actually non EU companies are also supposed to add VAT for all their EU customers.

This. Also as correctly stated from the article "digital platforms which enable third-parties to sell services must be liable to collect VAT and remit it to the department if they authorise the charge to the consumer, the delivery of the service, or if they set the general terms and conditions of the sale".

 

[Just_A_Guy]

Now I wonder where the VAT money actually ends up.

Honestly I'm wondering where the 20% cut they took from the models before went: also, there's no such recent changed interpretation of the law as an undefined spokeperson of the company claimed. That's total bs.

 

[Fatquack]

Just a few notes:
The VAT law from 2015 which is discussed is specifically about digital goods and services. Tokens are a digital good for this law. Subscriptionjs are a service.
VAT laws on physical goods are very country dependant.

I depends on which country the customer is in, it varies from no VAT exemption (Netherlands and Spain) up to 85,000 GBP (UK).

Correct, with a few caveats, in some countries you have to keep VAT records, but you get it back under a certain amount, to make it even more complicated. As far as I know the UK one is one of (if not) the highest exemption, I am not aware of anything as high as 90k/month.

I have had to declare the VAT for digital goods on amounts of only a few 100 a month, it was a tiny part of our business and I still had to do it. It was so much work that we had to stop the digital sales, it was not worth the time.

 

[LunaLuuvz]

Isn’t it more similar to Manyvids than Onlyfans though? Maybe that’s just my perception as someone who hasn’t even registered

AVN It's very similar to OnlyFans
I also remember a IG model that uses FindRow and Cheekky to sell her premium subscriptions

 

[DJ_Pioneer]

Just a few notes:
The VAT law from 2015 which is discussed is specifically about digital goods and services. Tokens are a digital good for this law. Subscriptionjs are a service.
VAT laws on physical goods are very country dependant.


Correct, with a few caveats, in some countries you have to keep VAT records, but you get it back under a certain amount, to make it even more complicated. As far as I know the UK one is one of (if not) the highest exemption, I am not aware of anything as high as 90k/month.

I have had to declare the VAT for digital goods on amounts of only a few 100 a month, it was a tiny part of our business and I still had to do it. It was so much work that we had to stop the digital sales, it was not worth the time.

Yes UK has the highest exemption currently, but it will be interesting to see what they do after the brexit transition period. The VAT regulations and exemptions gets really complicated hopefully there is going to be some reform in that area in the coming years.

 

[Diuturnum Illud]

btw at the moment (and I think it applies to every EU account) I'm not paying my country VAT (22%) but british VAT (20%)

 

[MousyLion]

btw at the moment (and I think it applies to every EU account) I'm not paying my country VAT (22%) but british VAT (20%)

If that really happens for other EU countries that's very weird, it'll mean the VAT is not taken for the user's country but it is taken for UK (OF's country)!?

I guess i'll know more near the end of the month when i have to renew a subscription, my country's VAT is less than 20%...

 

[Diuturnum Illud]

I think it's because EU companies (UK is still in the european single market until december 31st) can apply their country's VAT until a certain threshold, then they must apply the buyer's country VAT. Thresholds are pretty low for a company like OF (35,000€ in most countries), so I guess it will change soon.

 

[Fatquack]

I know there are companies who charge everyone the same VAT percentage, whatever country they are from, to keep it simple. They calculate it so it averages out and any differences come (or go in) out of their pocket. You still have to declare the proper amounts, but if you use MOSS you can quickly see the difference.

 

[DJ_Pioneer]

btw at the moment (and I think it applies to every EU account) I'm not paying my country VAT (22%) but british VAT (20%)

I checked and I get 25% VAT which is correct for Sweden.

 

[MousyLion]

Update: I renewed today and was charged 20% more(than in January) "for VAT in France(?!)". I'm not in France, and my country's VAT is less than 20%. Whatever...
It's already a bundle so (at least from my POV) the model has already done more than enough to make it affordable.


(just a thought, not sure if it will be a good idea in practice)

For members(&models) that and are willing to go through it, at least for more expensive content purchases one workaround might paying by tipping from a CB account with the model's link (it will require for the model to check that but it's doable and only needs to be done once) -> the model gets 83.28% from the money spent by the tipper(at least now, we'll see in the future...).

Another idea might be using crypto (though idk what the taxes are in this case in other countries, it needs more research; also while some models are already using it, many others don't like the idea and I can understand why).

 

[Diana_Devil]

So here we go , i am european and i live in europe and i pay independently taxes for over 8 years by now .

If you are living in the UE ( union european ) then VAT its working like this :

You go and register yourself as freelancer and you start to pay VAT - the VAT its calculated at every money transaction that will hit your bank account , you practically have to create an invoice from your bank account for any payout you get and to that you pay VAT . ( thats why its recomanded to have a totally separate bank account for your income ) .

In case you have an citizenship and you live in another country you will have to pay VAT for your income in both countrys if you have an living place in the 2 countrys ( i know it sucks ) .
The cam sites itself they are paying VAT yes but they pay it for the profit they get , not for the money that they invoice to us , that means we are always responsable to pay taxes for the money that we recive from the sites because we are independent contractors not employees.
Taxes in EU area are from 17% to 25% , Portugal does an exception with an 14 % for freelancers .

If you make around 45 000 euro ( cca 55 000 $ but always depend of the country minimal salary , you have to sum up the country minimal salary per 13 months ) per year you are forced to register yourself like a home based bussiness whitch will imply more taxes with the possiblility to choose how you want to pay taxes :

a) you pay less procentage from the money that hit your bank account , but then eventually bussiness costs are on your pocket
b) you pay more percentage from the money but only after from the money that hit your bank account , your eventuall bussiness costs and bills and materials were taken off . ( this requiers more attention and beaurocracy but worth ) This is normally done EVERY MONTH ( in small exception - after a few years running your bissiness you are allowed to tax every 3 or 6 months )

Then are those countrys where you have higher taxes pergentage - but you have schools free , public transportation costs less, rent cost less, healthy sistem its included . And are those countrys where you pay less taxes but you have to pay more for rent , public transportation , health sistem and so on.
In both cases if you opt for option b) then you can deduct all bills from taxes , and after the Clean of taxes money are calculated then submit yearly income taxes one more time and you ask taxes back ( like for example adding bills for family , kids and so on )

Hope this helps

PS : I do not know how is in the UK .

Please sorry eventual mistakes , or mixed grammar , hope you will can understand me

If you have any questions please ask , but keep them short and simple my brain does not react fast when i am very tired

Alsomay be small exception and regulation from one country to another in the European Union , but generally thats the basic guide.

 

[CheeseMoon]

Then are those countrys where you have higher taxes pergentage - but you have schools free , public transportation costs less, rent cost less, healthy sistem its included . And are those countrys where you pay less taxes but you have to pay more for rent , public transportation , health sistem and so on.

In the end this is the really important result of you paying VAT in Europe: free health care and free education.

Across most of (western) Europe this is also the case:
If/when the authorities decide that you were a business all along and can't find your tax payments in their records, they will simply send you a bill for whatever tax money they think you should have already paid them. You probably don't want neither this nor the public stigma of being a tax evader. Nobody likes people who promise to buy a round but conveniently "forgets" to do so.