Most creator selling platforms fall into a few business models. Knowing the model tells you who the legal seller is, who collects tax, and what you pay as you grow.
The Main Types, in General Terms
Merchant-of-record platforms
How it generally works: The platform is the legal seller to the customer and typically calculates and remits sales tax/VAT, in exchange for a per-sale fee.
Questions to consider:
- What is the fee per sale (percentage plus fixed amount)?
- Which countries' taxes are handled?
Subscription storefronts
How it generally works: You pay a monthly subscription and may pay lower per-sale fees; you may remain the legal seller.
Questions to consider:
- Who is responsible for sales tax/VAT?
- At what monthly sales level does a subscription cost less than a per-sale fee?
Self-hosted checkout with a payment processor
How it generally works: Your own site plus a payment processor and file delivery.
Questions to consider:
- You usually handle tax registration, invoices and consumer-law duties yourself.
- How will files be delivered securely?
Criteria and Questions to Ask
| Criterion | Why it matters | Question to ask |
|---|---|---|
| Fee structure | Percentage and fixed fees scale differently. | At my expected sales, which fee model costs less? (Example: a 10% fee on $300/month of sales equals a $30/month subscription.) |
| Tax handling | Digital sales can trigger tax abroad. | Is the platform the merchant of record? If not, what must I register for? |
| Payouts | Cash flow and country support. | Which countries and currencies are supported for payouts, and how often? |
| Refunds & consumer law | Customers keep statutory rights. | Can I show the digital-content withdrawal waiver and a statutory-rights statement at checkout? |
| Data & email | You may need customer contact. | Do I get buyers' emails, and under what consent? |
A Simple Checklist
- Model fees at three sales levels (low, expected, high).
- Confirm who is the legal seller and who collects tax.
- Write an accurate product description that matches the files.
- Use refund wording that keeps statutory rights intact.
Frequently Asked Questions
Can I say 'no refunds' on digital downloads?
You can usually exclude the change-of-mind cancellation right for instant downloads if the buyer expressly agrees, but you cannot exclude legal remedies for faulty or misdescribed products (e.g. UK Consumer Rights Act 2015, Australian Consumer Law).
What does merchant of record mean?
It is the business legally selling to the customer and responsible for the transaction, including sales tax/VAT in many cases.
- GOV.UK guidance on VAT for digital services
- Each platform's own pricing and terms pages
