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Distribution of gross revenue

The gross revenue refers to the money earned from a sale before any deductions. What you are entitled to after all deductions is your earnings.

What is this about?
This article explains how sales revenues are divided and how your share is calculated.  

Gross and Net

Financially, gross refers to a payment amount before taxes and other deductions. What remains after deductions is referred to as net.

  • Product buyers pay a gross price. This consists of the actual product price - the net price - plus statutory value-added tax (VAT).
  • From the seller's perspective, the money received is referred to as gross revenue. Due to the reseller model, Digistore24 is the product seller and receives the gross revenue. From this, VAT for the tax office is automatically deducted first, followed by the Digistore24 margin. The Digistore24 margin is based on the gross price.
  • What remains after tax and Digistore24 margin deductions is referred to as net revenue. The net revenue is the share of all vendors and affiliates involved in the sale.

Earnings

The net revenue initially belongs to you as the product creator.

  • If an affiliate and/or a joint venture partner is involved in the sale, they receive a contractually agreed affiliate commission or a partner share. These amounts are deducted from the net revenue of the sale.
  • The share of the net revenue that remains for you after all deductions and fees and is later transferred to your bank account is your earnings. Earnings are also referred to as the vendor share.
What is this about?
Your earnings are the balance that accumulates through sales in your Digistore24 account. The process in which your earnings are transferred to your bank account is called a payout.  

Order of Distribution

The gross revenue is distributed in the following order:

  1. Your tax office receives the value-added tax.
  2. Digistore24 receives the Digistore24 margin.
  3. The affiliate receives their affiliate commission.
  4. The joint venture partner receives their partner share.
  5. The vendor receives their earnings (vendor share).

Examples

The distribution of gross revenue depends on the country of origin, as they have different VAT rates.

Buyer from Germany

For buyers from Germany, Digistore24 pays the VAT to the German tax office. This is 19% of the gross price.

Scenario

  • Buyer from Germany purchases the product.
  • Gross price is 100 € (including 19% VAT in Germany).
  • Affiliate commission is set at 50%.

Distribution of gross revenue

  1. The German tax office receives 19% = 19 €.
  2. Digistore24 receives 7.9% + 1 € = 8.90 €.
  3. The affiliate receives 50% of the net revenue = 36.05 €.
  4. The vendor receives 50% of the net revenue = 36.05 €.

Buyer from EU country (not Germany)

For buyers from an EU country other than Germany, Digistore24 pays the VAT to the respective country's tax office. This corresponds to the local regulations.

Scenario

  • Buyer from Hungary purchases the product.
  • Gross price is 100 € (including 27% VAT).
  • Affiliate commission is set at 30%.

Distribution of gross revenue

  1. The Hungarian tax office receives 27% = 27 €.
  2. Digistore24 receives 7.9% + 1 € = 8.90 €.
  3. The affiliate receives 30% of the net revenue = 19.23 €.
  4. The vendor receives 70% of the net revenue = 44.87 €.

Buyer from Non-EU country

For buyers from countries outside the EU, Digistore24 does not pay VAT.

Scenario

  • Buyer from Norway purchases the product.
  • Gross price is 100 € (0% VAT, as it's not an EU country).
  • Affiliate commission is set at 10%.

Distribution of gross revenue

  1. The Norwegian tax office receives no share.
  2. Digistore24 receives 7.9% + 1 € = 8.90 €.
  3. The affiliate receives 10% of the net revenue = 9.11 €.
  4. The vendor receives 90% of the net revenue = 81.99 €.

Buyer from Switzerland

Switzerland is a special case. Although it is not part of the EU, 7.7% VAT is still paid to the Swiss tax office.

Scenario

  • Buyer from Switzerland purchases the product.
  • Gross purchase price is 100 € (including 7.7% VAT).
  • Affiliate commission is set at 50%.

Distribution of gross revenue

  1. The Swiss tax office receives 7.7% = 7.70 €.
  2. Digistore24 receives 7.9% + 1 € = 8.90 €.
  3. The affiliate receives 50% of the net revenue = 41.7 €.
  4. The vendor receives 50% of the net revenue = 41.7 €.
Tip
You can individually calculate your payouts with the Digistore24 tax and commission calculator.