Substack Takes Over VAT From December 1

My Medium friends can read this over on Medium.

Substack sent an email to everyone who charges for their work on the platform. Starting December 1, 2026, it handles the VAT.

Here is the line from the email:

Substack will take on the responsibility for calculating, collecting, and remitting indirect taxes, including VAT, GST, and similar, on your behalf in every country where our payment processor, Stripe, operates.

Until now, that job was yours.

The changes

I wrote about this problem before, in Substack Has a VAT Problem. Substack did not add, collect, or remit taxes for you. Stripe moved the money, and the tax side stayed with the publisher.

Now Substack does it. Automatically, on December 1. You don't have to switch anything on, and the email says so in plain words: "What do you need to do? Nothing!"

The fee stays at 10 percent.

No extra charge for the extra work.

Receipts and pricing

The tax shows up as its own line item. New paid subscribers see it at checkout. Existing ones see it on their receipt when the subscription renews.

Your price doesn't change. The total your subscriber pays does, depending on where they live. A reader in Hamburg and a reader in Oslo pay different totals, because the tax rates differ by country and state.

Not everything on Substack is taxable, either. Rates depend on country, state, and the type of content. You can check your content category in your VAT settings before December 1, so the right rate gets applied. Same place for any filing arrangements you already have.

Inclusive pricing

There is a second option, but only for publishers outside the US and Canada: inclusive pricing, where applicable.

The tax then comes out of your subscription price instead of being added on top. The reader sees the price you set. You keep what is left after the tax.

Example: a $7 subscription, a reader in Germany, 19 percent VAT. With inclusive pricing, roughly $1.12 of that $7 goes to the tax. Without it, the reader pays about $8.33 and you keep your $7 (before fees).

Which one is better depends on who your readers are. A surprise add-on at checkout is one thing. A smaller payout is another.

Downsides, of course

Nothing changes before December 1. Until then, the old rules apply, and the email says nothing about earlier periods.

Without inclusive pricing, a lot of readers will see a higher total than before. Some will notice. A few may cancel over it, I guess. And US and Canadian publishers don't get the inclusive option at all.

The email also leaves the details to the FAQ it links. Things like registrations and existing filings are in there, not in the mail itself. If you have your own VAT setup, that is the page to read. And if you have questions about your own tax situation, the email itself recommends a tax advisor.

Bottom Line

Substack went from "that's your problem" to "we'll take it". At the same 10 percent.

For paid publishers, that is one less thing to file. We'll see how the first receipts look after December 1.

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