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Does revenue I have to pay 5% on include VAT? If no why not?

Hello people,

as we all know we have to pay 5% of all "gross revenue" of our products per quarter over 3000$ to epic.

Now, my question is, whether VAT/Sales Tax/"Mehrwertsteuer" (in Germany) is deducted before that? Or is it included in the revenue the 5% is calculated of? So, let's say Steam sells a game of mine for 10€ in Germany (in the sense of: Alice pays 10€ to Steam and gets the game in her library). Of every end user sale the German federal government takes 20% (19, but 20 is easier). So 2€ in this case. Steam then takes 30% of that 8€. Do I have to pay 5% of that 20% to Epic (providing that we are over the threshold)?

Or put the other way around: Is the "gross revenue" in the UE4 EULA terms in this case the 8€ or the 10€?

In this (https://answers.unrealengine.com/questions/733816/5-of-revenue-including-or-excluding-vat.html ) Answerhub question a staff member gives this answer to that question:

Gross revenue for the purposes of calculating your royalty due to Epic does not include taxes or VAT.

Which is obviously what I want to hear, Kappa.

But the EULA does only use the term "gross revenue" without defining it (there is no entry for it under "Defintions"), and looking up online definitions of this term seem to include VAT, which mean I would need to pay the 5% on the 2€.

There is also no other mention of Sales Tax or VAT or anything like that in the EULA. It just says that I have to pay the taxes I have to pay and Epic has to pay the taxes it has to pay.

So, if the Answerhub I linked is correct: Why is it correct? What is the legal reasoning behind hat? Interpreting just the EULA and the "common meaning" of the term "gross revenue" it seems to be incorrect?

Neverthless, I would say it would probably make sense to include what exactly you mean with "gross revenue" as a definition in the EULA?


Product Version: UE 4.22
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asked Apr 04 '19 at 01:35 AM in Legal & Licensing

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Harth Tuwist
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