Sales tax

How are app sales taxed?

Atlassian aims to make your tax on sales experience hassle-free. We handle most calculation, collection, reporting and sales tax payment in relation to Marketplace transactions. We split app sales into two separate transactions:

• Wholesale transaction: In this transaction, as an app developer you act as a wholesaler. This means you sell app license keys to Atlassian Pty Ltd in Australia (Atlassian) for resale. Depending on your establishment location and tax status, this transaction might be subject to tax.
• Resale transaction:  Atlassian then resells your apps to end-users via the Atlassian Marketplace. You don’t need to do a thing to facilitate this transaction - we’ll collect applicable taxes, and submit returns based on the applicable laws. These laws vary depending where the end user (app purchaser) is located.

Selling your app as paid via Atlassian enables us to handle taxes in this way. As a paid via Atlassian app vendor, you agree to grant Atlassian an unlimited license to resell your apps through the Marketplace.

I’m in the United States. Do I need to do anything special?

If you’re an app developer in the US, you’re not required to issue Atlassian a wholesale invoice prior to receiving payment. We provide you with a reseller certificate that exempts you from calculating and collecting US sales tax on the wholesale transaction between you and Atlassian. Contact us if the reseller certificate you receive isn’t accepted by your local tax authority.

If you’re also registered for the Goods and Services Tax in Australia (GST), you are required to issue a tax invoice to Atlassian. Alternatively, you can enter into a Recipient Created Tax Invoice Agreement with Atlassian so you don’t have to issue this invoice. If you enter this agreement, Atlassian generates this invoice on your behalf, and pay you amounts owing and GST simultaneously. In this case, you are still responsible for for filing a GST return and reporting to the Australian Tax Office in accordance with your circumstances.

What if I’m a developer based in Australia?

As an app developer based in Australia, you’re required to issue a tax invoice to Atlassian in accordance with GST rules. You can, however, have Atlassian generate this invoice for you. We’ll create the invoice on your behalf, and pay your amounts owing and GST. In this case, you still need to file the GST return and report to the Australian Tax Office based on your individual situation.

If you’re a Marketplace vendor with an Aussie address and business number (ABN), you don’t need to take any additional steps to enter into the Recipient Created Tax Invoice (RCTI) agreement with Atlassian. The text of the RCTI agreement is included in the original Marketplace agreement. We generate tax invoices and pay the amounts owed as described in the agreement.

Lastly, if you’re in Australia but are not required to register for the GST, no need to issue Atlassian a tax invoice prior to payment. When you wholesale your app license keys to Atlassian, you’re not subject to the GST.

What if I’m a developer based in the European Union?

Whether you need to issue Atlassian a wholesale invoice depends on the laws in your EU member state. If an invoice is required, Atlassian investigates whether recipient self-billing is possible in your country.

If you’re also registered for the Goods and Services Tax in Australia (GST), you are required to issue a tax invoice to Atlassian. Alternatively, you can enter into a Recipient Created Tax Invoice Agreement with Atlassian so you don’t have to issue this invoice. If you enter this agreement, Atlassian generates this invoice on your behalf, and pay you amounts owing and GST simultaneously. In this case, you are still responsible for for filing a GST return and reporting to the Australian Tax Office in accordance with your circumstances.

My region isn’t mentioned–what do I do about taxes?

Unfortunately we can’t cover all regions here. We recommend contacting your local tax adviser to determine if sales made to an Australian company are subject to tax on sales or invoicing obligations in your jurisdiction.

Do I have to pay royalty withholding tax on payments received from Atlassian?

Under the wholesale transaction, you sell Atlassian copies of your app’s software license keys, along with a right to promote, resell and distribute license keys. This is instead of selling the copyright in the app itself. As a result, the Australian Tax Office doesn’t classify these wholesale payments as royalties, and doesn’t require Atlassian to set aside Australian royalty withholding tax from your payments unless advised otherwise.

Who do I contact with further tax questions?

Atlassian can’t know all the nuances of your individual situation, so we encourage you to seek advice from a registered tax advisor. We suggest finding somebody knowledgeable about sales and income tax, local levities, and any other taxes that might apply.

Much as we might like to be, we’re not tax gurus, so the information we provide should be considered as general information. These FAQ shouldn’t be relied on as tax advice or acceptance of responsibility for your tax liability or related costs.