Developers can now set tax categories for in-app purchases

App Store
App Store (Image credit: iMore)

What you need to know

  • Developers can now set tax categories in App Store Connect.
  • The feature will allow Apple to more accurately administer taxes in 64 territories for apps.

Apple is making it easier for developers to handle taxes in a number of territories.

In an update (opens in new tab) on the Apple Developer website, the company announced the addition of tax categories. The new feature will allow developers to list what tax regulation applies to their app in 64 territories which will help Apple to administer tax for them.

The App Store makes it easy for you to manage transactions in 175 territories, and Apple administers tax on behalf of developers in 64 of those territories. Now App Store Connect provides the ability to assign tax categories to your apps and in-app purchases. These categories are based on your app's content (for example, videos, books, or news publications) and determine which tax regulations apply in each territory, allowing Apple to administer tax for you at specific rates.

The feature will even let developers set different tax categories for each separate in-app purchase if they happen to land under tax regulations. If developers don't set anything, all purchases will continue to be assigned to the App Store software category.

To assign categories, visit the Pricing and Availability section for your app in App Store Connect. If a category applies to your app, select it at the app level to apply it to the app and its associated in-app purchases. You can also manage each in-app purchase individually. Your selections will be applied to future transactions and you can view the new Transaction Tax report the first full month after you configure your settings. If you choose not to make any changes, your apps and in-app purchases will be assigned the App Store software category at the same tax rate used today. Adjust these settings at any time as the characterization of your apps or in-app purchases evolve or as tax legislation changes.

Developers can learn more about setting tax categories on the App Store Connect Help (opens in new tab) website.

Joe Wituschek
Contributor

Joe Wituschek is a Contributor at iMore. With over ten years in the technology industry, one of them being at Apple, Joe now covers the company for the website. In addition to covering breaking news, Joe also writes editorials and reviews for a range of products. He fell in love with Apple products when he got an iPod nano for Christmas almost twenty years ago. Despite being considered a "heavy" user, he has always preferred the consumer-focused products like the MacBook Air, iPad mini, and iPhone 13 mini. He will fight to the death to keep a mini iPhone in the lineup. In his free time, Joe enjoys video games, movies, photography, running, and basically everything outdoors.