To sell digital products as a creator, make four decisions in order: what the product does for people who already follow you, how you will price it from your own costs, which checkout carries the sales tax and refund obligations, and what your refund policy has to say under consumer law. The checkout decision matters more than most guides admit. A merchant-of-record platform sells to your buyer and deals with GST or VAT itself, while a checkout that simply processes payments leaves you as the seller with that paperwork. The checklist, platform grid and pricing worksheet below take each decision in turn.
Pick a product your audience already asks for
The safest product answers a question people already put to you. Scroll back through comments, replies and direct messages and note the requests that repeat: how you edit, what you use, how you plan a week of posts, where you learned a skill. A digital product is that answer packaged so people can use it without you. Before you build anything large, describe the product in one sentence and offer a waitlist to the people who asked; if nobody joins, you have saved yourself the build.
| Product type | What the buyer gets | What it costs you to make | Where refunds and support come from |
|---|---|---|---|
| Templates and presets | Files they edit for their own projects | Design time plus testing in each app and on each device you claim to support | Files that will not open in the software version the buyer has |
| Guides and ebooks | A written method they can follow at their own pace | Writing, editing, layout and an accessibility check of the file | Promises about outcomes that the content cannot support |
| Recorded courses or workshops | Video lessons, worksheets and a sequence to follow | Scripting, filming, editing and paying for hosting | Broken lessons, missing files or access ending sooner than the buyer expected |
| Ticketed live sessions | A seat in a scheduled class or group call | Preparation time plus the session itself | Rescheduled dates and buyers who cannot attend |
| Checklists and swipe files | A short resource for one specific task | Little build time, but regular updates to stay accurate | Buyers expecting more depth than the listing described |
Check the platform allows your category before you build. Gumroad's pricing page FAQ, for example, lists obscene or adult content among the things it does not permit. If you sell pay-per-view messages on a subscription platform, that pricing question is covered separately in our OnlyFans pricing guide, and one-off sales inside a membership are covered in our walkthrough of Patreon Shop one-time purchases.
Merchant of record or not: the checkout decision
A merchant of record is the business your buyer is legally purchasing from. When the platform takes that role, it charges the buyer, collects the sales tax and pays you what is left after its fee. When it does not, you are the seller and the platform is just the shop window and the till. The grid below records what each platform's own pages said when checked on 1 October 2026; confirm the live pages before you choose, because fees and schedules change.
| Checkout | Who sells to the buyer | Who handles GST and VAT | Payout timing and minimum | Source |
|---|---|---|---|---|
| Gumroad | Gumroad, as merchant of record for all sales since 1 January 2025 | Gumroad collects and remits sales tax where it has obligations, with VAT on digital products charged at checkout | A $100 USD minimum balance; on weekly, monthly or quarterly schedules each sale is held at least 7 days, and payouts cover sales through the previous Friday (UTC) | Sales tax on Gumroad; Getting paid by Gumroad |
| Lemon Squeezy | Lemon Squeezy, as merchant of record | Lemon Squeezy, with tax and currency conversion covered by its fee | Payouts created on the 1st and 15th; net sales held for 13 days and paid on the 14th and 28th; a $50 minimum | Lemon Squeezy: Getting Paid |
| Ko-fi Shop | You; Ko-fi's terms say it is not the seller of creator content | You are solely responsible for income tax, VAT, GST and sales tax on what you sell | Payments go straight to your connected PayPal or Stripe account when the sale happens | Ko-fi Terms; Ko-fi Shop help |
| Shopify store | You, as the merchant | You charge VAT at the EU customer's rate; Shopify offers digital VAT settings and shows billing address and IP address as location evidence | Not covered on the tax page; check your payment provider settings | Shopify: Digital product taxes |
Fees belong in your worksheet, not your platform choice alone. Gumroad's pricing page lists 10% plus $0.50 per sale through your own profile or links and 30% when a new customer finds you through its Discover marketplace, while the Ko-fi Shop help page describes a 5% service fee on sales. When you compare a merchant of record with a plain payment processor, set its fee against the processing charges, registrations, returns and adviser time you would otherwise carry yourself. For a side-by-side of two creator platforms that handle this differently, see Ko-fi vs Patreon.
GST and VAT on digital products: where the duty lands
If you are the seller, three sets of rules come up most often for creators selling online. In Australia, the ATO's Registering for GST page says you must register once your GST turnover reaches $75,000 or more, or is projected to, and must do so within 21 days of crossing the threshold; you need an ABN first. Sellers based outside Australia have a separate rule: the ATO's page on GST on imported services and digital products says GST applies to sales to Australian consumers of items such as e-books, apps, webinars and distance learning courses, and that the merchant or an electronic distribution platform operator may be the one responsible.
For buyers in the European Union, the Your Europe guide to the VAT One Stop Shop says businesses established outside the EU can use the non-Union scheme for services supplied to EU consumers, registering in any one EU country, filing a quarterly return and charging the customer's country rate. The European Commission's One Stop Shop portal explains that the EUR 10 000 annual threshold for cross-border electronically supplied services applies only to suppliers established in a single EU member state, so it does not help a seller based in Australia or the UK.
For buyers in the UK, HMRC's guidance on VAT rules for digital services supplied to consumers says such sales are liable to UK VAT, that a business based outside the UK needs to register for UK VAT, and that when you sell through a third-party platform or marketplace the platform accounts for the VAT instead. It treats a business that only processes payments as something other than a platform, so a payment link does not move the duty off you.
Where the official pages disagree: the HMRC page, last updated in March 2022, still tells UK businesses selling to EU consumers to register for the “Non-Union VAT MOSS”. The European Commission's portal says the mini One Stop Shop was extended into the One Stop Shop from 1 July 2021, so for the EU side of your sales follow the EU's own description of the current scheme and confirm it with your adviser.
Pricing worksheet
Price from your own numbers rather than from what similar products seem to cost. Fill every line from your records and the platform pages you will actually use.
| Line | What to enter | Your figure |
|---|---|---|
| A. Build cost | Hours to create the product multiplied by the hourly rate your business needs, plus tools, fonts, music or stock bought for it | ________ |
| B. Price to test | The price you will show buyers, including tax if you sell to Australian consumers as a registered seller | ________ |
| C. Platform fee per sale | Taken from the platform's current pricing page for the sales channel you expect to use most | ________ |
| D. Processing cost per sale | Only if card or wallet fees are charged on top of the platform fee | ________ |
| E. Tax inside the price | The GST or VAT portion you must pass on when you are the seller; zero when a merchant of record handles it | ________ |
| F. Refund allowance | An amount per sale set aside for refunds and chargebacks, based on your own history once you have one | ________ |
| G. Net per sale | B minus C, D, E and F | ________ |
| H. Break-even sales | A divided by G, rounded up | ________ |
If line H is more sales than you can realistically make to your current audience, change the product rather than hoping for reach: shrink the build, raise the price with more depth, or sell a smaller first version. For Australian consumers, the ACCC's price displays guidance says the displayed price must be the total as a single figure, including taxes and unavoidable fees, so do not advertise a lower price and add GST at checkout.
Refunds and consumer guarantees
Australian consumer law limits what a refund policy can say. The ACCC's page on consumer rights and guarantees says these guarantees are automatic and cannot be removed by a “no refunds” sign or by saying refunds are unavailable after a set number of days. It also says an overseas business selling directly to consumers in Australia must follow the Australian Consumer Law, which matters if you are based elsewhere but your buyers are not. Products must match their description, so the listing is part of your compliance.
Change-of-mind refunds are different. The ACCC's guidance on contacting a business to fix a problem says businesses do not have to offer them and may attach conditions to a change-of-mind policy, but cannot apply those conditions when the product has a major or minor problem. A workable policy for a downloadable file therefore separates the two cases:
- State whether you offer change-of-mind refunds on downloads, and any conditions, in plain words on the product page.
- Say that this does not affect the buyer's rights if the file is faulty, will not open or is not what the listing described.
- Give a support address and a realistic reply time that you can keep.
- List file formats, compatible apps, length or page count and anything not included, so the description can be matched.
- When you sell through a merchant of record, read its buyer refund terms too, because its policy runs alongside yours.
Launch checklist
- Write the product's one-sentence promise and test it on the people who asked for it.
- Confirm the checkout permits your product category and the countries you plan to sell to.
- Choose merchant of record or self-seller, and if you are the seller, settle your GST or VAT position with an adviser before the first sale.
- Complete the pricing worksheet and display a single total price to consumers.
- Write a description that matches the file exactly: contents, formats, compatibility and what is excluded.
- Publish refund wording that keeps consumer guarantees intact.
- Buy your own product as a test, download it on a phone and a computer, and check the receipt shows the right seller.
- Keep affiliate links out of the file if a program bans them in ebooks; our affiliate program scorecard shows where to check.
- Announce to your own subscribers first, using a list built with consent as described in our guide to building an audience you own.
- Save every sale, refund and platform statement for your tax records.
Limitations of this checklist
The platform grid reflects each provider's own help and pricing pages on one date, and fees, schedules and merchant-of-record arrangements change. The tax summaries cover Australia, the EU and the UK only; US states, Canada and other countries have their own rules for digital goods, and thresholds and registration duties depend on your full circumstances, not just one product.
The refund section describes Australian consumer law; UK and EU consumer law has its own rules for digital content. This is general information, not tax or legal advice. Speak to a registered tax agent about GST and VAT, and to a lawyer if your product, licence terms or refund policy is unusual.