Gross and net pricing modes
Choose whether taxes are included in your displayed price or added at checkout.
Each store applies pricing to products in either Gross Pricing Mode or Net Pricing Mode.
Depending on your settings, FastSpring automatically calculates taxes for each order and remits them to the appropriate taxation authorities. If a customer enters a valid ID for tax exemption, FastSpring does not charge the customer tax; this does not impact your income.
Note: By default, FastSpring applies Net Pricing Mode to new stores.
The sections below explain the logic, deductions, and customer experience for each mode. Select a card or use the TOC on the right to jump ahead.
Pricing logic and examples
Select a mode below to understand how the customer-facing price is displayed and how your payout is calculated.
In Gross Pricing Mode, the price shown to the customer includes all applicable taxes. You can customize the price for specific currencies to account for these taxes. If you do not customize the price, FastSpring automatically converts it from your base currency.
Important Exception (USD Orders): Gross Pricing Mode does not apply to orders processed in US Dollars (USD). FastSpring treats all USD transactions as Net and we take your specified price and add applicable taxes to the final total.
How it works (Non-USD)
- Display: FastSpring displays the final price (e.g., €10.00) to the customer.
- Deduction: We deduct the applicable tax for that specific region from the total.
- Payout: You receive the remaining "Net" amount.
- Result: Your gross profit will vary for each customer depending on their local tax rate.
Example
In the example below, you configure a product to be € 10.00. When a customer in Germany purchases the product, FastSpring applies Germany’s VAT rate of 19% (or € 1.90). The remaining € 8.10 from your order is your Net Price.
| Description | Calculation | Amount |
|---|---|---|
| Gross Price | The price displayed to the customer (Net Price + Tax Amount) | € 10.00 |
| Net Price (Your Profit) | Gross Price / 1.19 | € 8.40 |
| Tax Amount | Gross Price – Net Price | € 1.60 |
Note: The Net Price shown above does not yet account for commissions, split shares, or FastSpring processing fees, which are deducted from the Net Price.
In Net Pricing Mode, you receive the same base price for your product, regardless of taxes. This excludes taxes from your prices. When you configure a price in a non-USD currency, FastSpring adds taxes to the total and displays it at checkout. The totals will vary depending on taxes for each region.
How it works
- Display: FastSpring displays your base price (e.g., €10.00).
- Addition: We calculate the local tax rate and add it to the total.
- Payout: You receive your full base price.
- Result: The customer pays a variable total, but your profit margin remains stable.
Example
In the example below, you configure a product for € 10.00. When a customer in Germany purchases the product, FastSpring applies Germany’s VAT rate of 19% (or € 1.90). Then, FastSpring adds € 1.90 to the order and displays a total of € 11.90. You receive € 10.00 for this order; the € 10.00 does not account for additional fees and deductions.
| Description | Calculation | Amount |
|---|---|---|
| Net Price | The base price you set | € 10.00 |
| Tax Amount | Net Price * 0.19 | € 1.90 |
| Total Price | Net Price + Tax Amount | € 11.90 |
Note: FastSpring processing fees, commissions, and split shares are deducted from your Net Price (€ 10.00).
Change pricing mode
To change your store's pricing mode, please contact FastSpring Support.
- Impact: This change applies to new orders only.
- Subscriptions: Changing the mode will not affect active subscriptions. Existing recurring charges will continue to use the pricing mode that was active when the subscription began.
Payout deductions
Regardless of the pricing mode selected, the amount you receive from FastSpring is the Net Price minus the following standard deductions:
- Store discounts
- Affiliate commissions
- Split shares
- FastSpring’s processing fee
Updated 7 months ago