Tax responsibilities for Microsoft Marketplace publishers

Appropriate roles: Owner and Financial Contributor

This article describes the tax responsibilities and tax considerations for Commercial Marketplace Publishers (Publishers) according to the Microsoft Azure Marketplace Publisher Agreement, Authorized Partners to whom Publishers extend private Offers in Commercial Marketplace according to Addendum B in the Microsoft Publisher Agreement and the App Developer Agreement, respectively.

The following information applies to both Commercial Marketplace and Consumer Marketplace (together, "Microsoft Marketplaces") unless expressly stated otherwise.

The following information is subject to change. Publishers, authorized Partners, and Developers are responsible for reviewing this page for current, accurate information.

Taxes on offer transactions

Each of Microsoft's Publishers' and Developers' responsibilities for sales, use, goods and services, value added or similar taxes (Transaction Taxes) if any, on Customer acquisitions of Offers through Microsoft Marketplaces (Offer Taxation) depend on the country/region (which includes special administrative regions) in which Publishers/Developers elect to make Offers available for sale through the Microsoft Marketplaces.

Each country/region will, for each Microsoft Marketplace, constitute a Publisher/Developer-Managed country/region, a Microsoft-Managed country/region, or a Reseller country/region.

In Publisher/Developer-managed countries/regions (each, a "Publisher/Developer-Managed country/region"), Microsoft acts as an agent or commissionaire (as applicable) of Publisher/Developer. Publishers/Developers acknowledge and agree that Publishers/Developers have sole responsibility to determine all compliance required for, and to manage, Offer Taxation, including but not limited to registration, tax calculation, tax collection, tax remittance, validation of business status of Customers and providing tax invoices to Customers. Publishers/Developers acknowledge that, with respect to any sale in a Publisher/Developer Managed Country, Microsoft currently might not be able to provide the transaction details required for Publishers/Developers to provide Customers with tax invoices.

In Publisher/Developer-Managed countries/regions, Microsoft deducts the Store Service Fee, any Transaction Taxes applicable to the Store Service Fee, and any applicable withholding tax. The remaining payout amount is inclusive of any extra Publisher/Developer tax responsibilities for which Publisher/Developer is responsible.

Publisher/Developer-Managed countries/regions include any countries/regions where Microsoft supports Microsoft Marketplace sales and that aren't a Microsoft-Managed country/region or a Reseller country/region.

In Microsoft-Managed countries/regions (each, a "Microsoft-Managed country/region"), Microsoft acts as an agent of the Publisher/Developer. Microsoft assumes responsibility for managing Offer Taxation, including calculating, collecting, and remitting certain taxes. For Commercial Marketplace, it might also include validating the business status of Customers by obtaining tax registration numbers or exemption certificates. Microsoft manages Offer Taxation through either local affiliates or remote affiliates that are registered locally. Microsoft invoices under Microsoft's applicable registration number. Microsoft includes any taxes collected from Customers on Microsoft's tax return.

In Microsoft-Managed Countries, Microsoft deducts the Store Service Fee, any Transaction Taxes applicable to the Store Service Fee, Transaction Taxes collected as part of Offer Taxation and any applicable withholding tax from the amount paid to you. The reports Microsoft makes available to Publishers/Developers identifies the amount of these taxes.

See the following table that lists the Microsoft-Managed Countries, Countries with Differences in Commercial Marketplace and Consumer Marketplace, and Taxes on Store Service Fee.

Microsoft makes no warranties that Microsoft's actions completely satisfy Publisher/Developer obligations in Microsoft-Managed Countries. For all Microsoft-Managed Countries, Microsoft strongly recommends Publishers/Developers work with their own tax advisors to determine whether their tax obligations are satisfied through Microsoft Marketplaces.

In Reseller countries/regions (each, a "Reseller country/region"), Microsoft acts as a reseller, rather than as Publisher/Developer's agent, in making Publisher/Developer Offers available through the Microsoft Marketplaces. Publishers/Developers are responsible for Transaction Taxes, if any, on the sale of Offers to Microsoft, and Microsoft is responsible for all Offer Taxation on the resale to Customers.

In Reseller countries/regions, Microsoft deducts the Store Service Fee, any Transaction Taxes applicable to the Store Service Fee, Transaction Taxes collected as part of Offer Taxation and any applicable withholding tax from the amount paid to you. The reports that Microsoft makes available to Publishers/Developers identify the amount of these taxes.

Lists of countries/regions

The following tables show the Microsoft-managed, Reseller Differences in Commercial Marketplace and Consumer Marketplace, and Taxes on Store Service Fee countries/regions.

Microsoft-managed countries/regions

Reseller countries/regions

• Brazil

Countries/regions with differences in Commercial Marketplace and Consumer Marketplace

Taxes on Store Service Fee

Microsoft might, in certain cases, collect Transaction Tax on Store Service Fee in the following countries where Publishers/Developers elect to make Offers available through the Microsoft Marketplaces:

• Australia
• Canada
• Mexico
• New Zealand
• Singapore

Related content

• Publisher FAQ
• Instructions to create payout and tax profiles
• Tax Information for Commercial Marketplace