I wonder why they're not doing that and creating all kinds of weird edge cases that will encourage hacky workarounds.
I guess they didn't want to lose out on the first million from those who are above the first bracket.
Year 1: 999k --[-15%]--> 849k (This year doesn't trip the "limit"
Year 2: 1000k --[-15%]-->850k (Limit is tripped, next year is 30%)
Year 3: 999k --[-30%]-->699k (Fell below the limit, next year is 15% again)
Basically if you are close to the limit at the end of the year, you should immediately stop all advertising/marketing spend to ensure you don't go over the peak :)
I'm not really sure why they did it this way as it really screws over people that are just at the 1m/yr mark, vs a progressive system that would "just work."
Why cant it just be simple where your First $1M will be 15% bracket regardless of total sales.
Yet they have 2 full year to see how it goes and work around all the edge case. I bet nobody except professional haters will complain if they soften the rules in 18 months.
Or, they could've just picked $1 million because it's a nice round number and looks good in a press release.
Cyberpunk always wins, in the long run.
That would be dangerous, because imagine being under 1million all year, and in December you make 1 dollar too much - suddenly you would have to pay Apple a lot of money you may have already spent. You never pay Apple though, they just keep their cut.
0-9000€ [0%] -> 0€
9000-20.000€ [10%] -> 1100€
20.000-40.000€ [15%] -> 3000€
Total = 4400€
So if you're in the 15% bracket you pay 4400€ which is actually 12.5% in total, and not 5250€ (15%) as some people seem to believe.
[1] https://en.wikipedia.org/wiki/Progressive_tax (See the Computation section for how the higher rates only apply to the higher portions of a person's income, with their lower portions taxed less.)
I would like if there is any solution to this other than to apply the same percentage to all income.
You'd pay let's say 15% over the first 30k, and then 30% over the remainder.
999k --[-15%] --> 849k
1000k --[-15%x1000k] [-30%x0] --> 850k
1213k --[-15%x1000k] [-30%x213k]--> 999kMy guess is that creating apps for the App store is actually far less profitable than Apple wants us to believe. That is, unless you are a large publisher.
I'd really like to see the distribution here, I wouldn't be surprised if there is a huge income gap.
"In a gold rush, you don't get rich by digging for gold - you get rich by selling shovels"
250k-500k - 5% 500k-1000k - 20% 1000k- ∞ - 30% (figures in INR)
the brackets varies every FY, but are same more or less.
It doesn't discriminate with border cases.
EDIT: It looks like I am wrong, ignore me.
The relevant sentence seems to be "If a participating developer surpasses the $1 million threshold, the standard commission rate will apply for the remainder of the year." (emphasis mine)
Apple takes the comission as you go, so it sounds like they take 15% of each sale until you hit $1M, and then 30% for every sale after that.
The next year they'd take 30% right from the start though, so a good year followed by a bad one would be unfortunate.
If you get kicked out, you're stuck paying 30% for at least a year.
If I understand correctly though, since it's a hard cutoff it creates this gap between 1m and ~1.2m where you're actually worse off by making more money pre-tax.