Charge Back and Refunds

mr1602 · April 2016

The 'it is a donation' angle has been proven to be false many times in this thread because CIG charges VAT.

Armendius · April 2016

mr1602 said:

The 'it is a donation' angle has been proven to be false many times in this thread because CIG charges VAT.

That is something different then to define it to be not a donation from its origin.

VAT is a separate component.

If you wish a little bit more clarification, the rules are the host that is the Kickstarter website.
If you click on their website what is a kickstarter, it is that you help them with resources and support.
I do not feel the need to go dig up everything about this, the picture clearly display it is a reward for an amount you donate to support a project.

This whole story is so complex as Kickstarter is a party in the middle
that tax the project after it is compleet.
What is strange if it were to be secure money for the future (pledge) .
But that would take so much time to really dig and I am honestly haveing no interest to do so.

Same as on the current Star Citizen website, they call it pledge in the top, and packages in the bottum of the website.
Does indeed make little sense as you buy something that say "in stock" when it is from a direct trader.
Never seen this before, other developers call it extra content in early acces or even from alpha stage.

The VAT is not the most intressting part in this quest to be honest.
But I am afraid I cannot delve deeper then the basics anyone can find or see.

mr1602 · April 2016

Armendius said:

mr1602 said:

The 'it is a donation' angle has been proven to be false many times in this thread because CIG charges VAT.

That is something different then to define it to be not a donation from its origin.

VAT is a separate component.

If you wish a little bit more clarification, the rules are the host that is the Kickstarter website.
If you click on their website what is a kickstarter, it is that you help them with resources and support.
I do not feel the need to go dig up everything about this, the picture clearly display it is a reward for an amount you donate to support a project.

This whole story is so complex as Kickstarter is a party in the middle
that tax the project after it is compleet.
What is strange if it were to be secure money for the future (pledge) .
But that would take so much time to really dig and I am honestly haveing no interest to do so.

Same as on the current Star Citizen website, they call it pledge in the top, and packages in the bottum of the website.
Does indeed make little sense as you buy something that say "in stock" when it is from a direct trader.
Never seen this before, other developers call it extra content in early acces or even from alpha stage.

The VAT is not the most intressting part in this quest to be honest.
But I am afraid I cannot delve deeper then the basics anyone can find or see.

I'm having a bit of trouble understanding this post, I assume the poster is not a 'english as first language' person so I apologize if I've misunderstood your post.

The 'VAT is a separate component' makes no sense as it is CIG who decided to state what this transaction is. CIG charges VAT when you pledge and it charged VAT when you pledged during the Kickstarter. That means CIG cannot consider the transaction as a 'donation' in the eyes of the law.

Calling something a donation when it is not, is lying which is strange and weird.

Octagon7711 · April 2016

Forgive me, but a donation is when you give money or items without the expectation of receiving anything in return. It's not I'll give you some money if you promise to give me something in return, that's a transaction.

Asm0deus · April 2016

You guys assume donations are all tax free things, they are not. Certain requirements must be met for donation to be tax deductible.

Just because donations are usually made to charities and non profits doesn't mean ALL donation are to such groups.

Realizer · April 2016

It's a pledge of support for the game, non of the ships need to be bought ahead of time, most all of them will be available to be earned in game without real money. You will also be able to buy the game after it releases, if you decide you'd like to buy now to help the game get made that's on you. If you are on the fence wait, simple as that. No one got strong armed out of their cash, no guns were used to make people spend, they did it on their own accord. If anything comes out of this game, hopefully it will be that people will learn to spend money they can afford not to keep. If you're broke don't buy ships in space sims.

Octagon7711 · April 2016

I still think it's a sale. No different from buying something off Amazon. I can say I'm buying it from Amazon to support the company because I like them, but everyone knows it's a business. You pay for something. You get something in return. You get a receipt. If you don't like the product there's a return policy.

Distopia · April 2016

mr1602 said:

Armendius said:

mr1602 said:

The 'it is a donation' angle has been proven to be false many times in this thread because CIG charges VAT.

That is something different then to define it to be not a donation from its origin.

VAT is a separate component.

If you wish a little bit more clarification, the rules are the host that is the Kickstarter website.
If you click on their website what is a kickstarter, it is that you help them with resources and support.
I do not feel the need to go dig up everything about this, the picture clearly display it is a reward for an amount you donate to support a project.

This whole story is so complex as Kickstarter is a party in the middle
that tax the project after it is compleet.
What is strange if it were to be secure money for the future (pledge) .
But that would take so much time to really dig and I am honestly haveing no interest to do so.

Same as on the current Star Citizen website, they call it pledge in the top, and packages in the bottum of the website.
Does indeed make little sense as you buy something that say "in stock" when it is from a direct trader.
Never seen this before, other developers call it extra content in early acces or even from alpha stage.

The VAT is not the most intressting part in this quest to be honest.
But I am afraid I cannot delve deeper then the basics anyone can find or see.

I'm having a bit of trouble understanding this post, I assume the poster is not a 'english as first language' person so I apologize if I've misunderstood your post.

The 'VAT is a separate component' makes no sense as it is CIG who decided to state what this transaction is. CIG charges VAT when you pledge and it charged VAT when you pledged during the Kickstarter. That means CIG cannot consider the transaction as a 'donation' in the eyes of the law.

Calling something a donation when it is not, is lying which is strange and weird.

The sites themselves in the "fine print" label the "purchaser" as donor (gofundme), pledger(kickstarter), contributer (indigogo), as well as label the "purchase", a donation, a pledge or contribution to a "funding campaign"... Even considering as an example kickstarter says this:

"Sales tax may also be applicable in certain cases depending on the local rules. In general, sales tax applies only if the creator has sufficient connection to the location of the backer."

IF you want to take lying up with someone take it to the source. As that's where the idea of it being that comes from.

Talinthis · April 2016

Octagon7711 said:

I still think it's a sale. No different from buying something off Amazon. I can say I'm buying it from Amazon to support the company because I like them, but everyone knows it's a business. You pay for something. You get something in return. You get a receipt. If you don't like the product there's a return policy.

doesnt matter what you think it means, a pledge is giving money, in return for nothing. you basically paid for nothing, and they give you some ships as thanks. they do not have to ever return anything to you whether you think you deserve it or not.

people dont know what they are doing, yet they buy them anyway, and then expect a refund for a donation they made. doesnt work that way. thats like giving some homeless guy a 20 and then turning around and changing your mind.. he will probably try and kick your ass.

ps its much different than buying something off amazon, as amazon is money for some sort of goods, which in this case for star citizen, it is not.

Distopia · April 2016

Octagon7711 said:

I still think it's a sale. No different from buying something off Amazon. I can say I'm buying it from Amazon to support the company because I like them, but everyone knows it's a business. You pay for something. You get something in return. You get a receipt. If you don't like the product there's a return policy.

If it was a purchase in the manner you're eluding to you'd be able to buy it on Amazon now, retailers don't deal in contribution options...

Distopia · April 2016

Talinthis said:

Octagon7711 said:

I still think it's a sale. No different from buying something off Amazon. I can say I'm buying it from Amazon to support the company because I like them, but everyone knows it's a business. You pay for something. You get something in return. You get a receipt. If you don't like the product there's a return policy.

doesnt matter what you think it means, a pledge is giving money, in return for nothing. you basically paid for nothing, and they give you some ships as thanks. they do not have to ever return anything to you whether you think you deserve it or not.

people dont know what they are doing, yet they buy them anyway, and then expect a refund for a donation they made. doesnt work that way. thats like giving some homeless guy a 20 and then turning around and changing your mind.. he will probably try and kick your ass.

That isn't true either, Backers have legal options in the event of project failure. Projects are liable to use those funds as well as communicate honestly. Just as any other company under the sun is.

Armendius · April 2016

I mean if you buy in the time from Kickstarter the rules is from them and not the person you are supporting.

On the current website I meant, it is I am pledgeing to buy for example an american car.
It is strange to use this word pledge in a direct purchase "in stock", what is also how they describe it in the Terms they have, they assume the digital container, to be the same as pledgeing to a project.

Sounds misplaced.

tawess · April 2016

vorpal28 said:

From the original Kickstarter, they've revised it now to 2016 for the MVP commercial release

estimated is estimated.

SpottyGekko · April 2016

A Kickstarter pledge or any similar kind of "development funding" is fundamentally different from a pre-order or online purchase of goods at a retailer.

That's because there's no guarantee of actual product delivery in the case of the "development funding". If the Kickstarter project fails to produce a game after making a demonstrable "best effort", then the pledged funds are forfeit.

The fact that there are pledge rewards involved seems to confuse some people. They forget that the rewards don't exist unless the project is successfully completed.

Everything hinges on the project being completed, and that is a very risky venture. Even "well managed" and independently funded game developments by AAA developers get cancelled, so there's no guarantee that a game development project will always be completed.

mr1602 · April 2016

Distopia said:

The sites themselves in the "fine print" label the "purchaser" as donor (gofundme), pledger(kickstarter), contributer (indigogo), as well as label the "purchase", a donation, a pledge or contribution to a "funding campaign"... Even considering as an example kickstarter says this:

"Sales tax may also be applicable in certain cases depending on the local rules. In general, sales tax applies only if the creator has sufficient connection to the location of the backer."

IF you want to take lying up with someone take it to the source. As that's where the idea of it being that comes from.

What the agreement is between CIG and KickStarter is irrelevant to the customer as the customer was not involved in said agreement nor have first-hand knowledge of it ('cannot be reasonably assumed to know' if you want the actual 'law' phrase)
The only thing the customer can say for 100% certain is the transaction that occurred on their account and the invoice of that transaction. If there's 'VAT' on that invoice, the transaction cannot be deemed to be a 'donation'.
Whether someone thinks it should be OR it was suppose to be OR someone is trying to break tax laws OR it was an honest mistake; all are irrelevant in terms of the law.
If it was an honest mistake, the tax department will go through its process (provided the company co-operates) to make sure there was no intent to fraud and hand out penalties according to the mandate they have to follow.

TLDR; whatever anyone says is irrelevant. If it has VAT, it can't be a donation.

Armendius · April 2016

mr1602 said:

Distopia said:

The sites themselves in the "fine print" label the "purchaser" as donor (gofundme), pledger(kickstarter), contributer (indigogo), as well as label the "purchase", a donation, a pledge or contribution to a "funding campaign"... Even considering as an example kickstarter says this:

"Sales tax may also be applicable in certain cases depending on the local rules. In general, sales tax applies only if the creator has sufficient connection to the location of the backer."

IF you want to take lying up with someone take it to the source. As that's where the idea of it being that comes from.

What the agreement is between CIG and KickStarter is irrelevant to the customer as the customer was not involved in said agreement nor have first-hand knowledge of it ('cannot be reasonably assumed to know' if you want the actual 'law' phrase)
The only thing the customer can say for 100% certain is the transaction that occurred on their account and the invoice of that transaction. If there's 'VAT' on that invoice, the transaction cannot be deemed to be a 'donation'.
Whether someone thinks it should be OR it was suppose to be OR someone is trying to break tax laws OR it was an honest mistake; all are irrelevant in terms of the law.
If it was an honest mistake, the tax department will go through its process (provided the company co-operates) to make sure there was no intent to fraud and hand out penalties according to the mandate they have to follow.

TLDR; whatever anyone says is irrelevant. If it has VAT, it can't be a donation.

uhm this is a strange thought.

The time where you buy something on a website, is the agreement between all parties.

Erillion · April 2016

Could be relevant for this discussion:

https://robertsspaceindustries.com/comm-link/transmission/14433-VAT-Change-Announcement

Star Citizen charging VAT in Europe: Start date February 1st, 2015

Thats more than 2 years after Kickstarter in October/November 2012.

Have fun

Distopia · April 2016

mr1602 said:

Distopia said:

The sites themselves in the "fine print" label the "purchaser" as donor (gofundme), pledger(kickstarter), contributer (indigogo), as well as label the "purchase", a donation, a pledge or contribution to a "funding campaign"... Even considering as an example kickstarter says this:

"Sales tax may also be applicable in certain cases depending on the local rules. In general, sales tax applies only if the creator has sufficient connection to the location of the backer."

IF you want to take lying up with someone take it to the source. As that's where the idea of it being that comes from.

What the agreement is between CIG and KickStarter is irrelevant to the customer as the customer was not involved in said agreement nor have first-hand knowledge of it ('cannot be reasonably assumed to know' if you want the actual 'law' phrase)
The only thing the customer can say for 100% certain is the transaction that occurred on their account and the invoice of that transaction. If there's 'VAT' on that invoice, the transaction cannot be deemed to be a 'donation'.
Whether someone thinks it should be OR it was suppose to be OR someone is trying to break tax laws OR it was an honest mistake; all are irrelevant in terms of the law.
If it was an honest mistake, the tax department will go through its process (provided the company co-operates) to make sure there was no intent to fraud and hand out penalties according to the mandate they have to follow.

TLDR; whatever anyone says is irrelevant. If it has VAT, it can't be a donation.

WHen you pledge to kickstarter you are in essence agreeing to that deal as well as the rules I was quoting from, apply to both parties in said agreement. ( you can read all about that on their site which is what I did before posting)...That doesn't mean you can't get refunds or can't charge back, as it is also mentioned in that agreement the Campaign should have a sound refund policy in place given the advent of failure, as well as communicate any problems they are having with the backer behind the pledge.

A failure in this regard opens them up to legal actions on behalf of those that have pledged, which I would assume includes backers using legally available options to recoup losses ( Charge-back is a legal means of action in this scenario as plans outlined have not been met, as well as could be argued not communicated properly)...

SpottyGekko · April 2016

Distopia said:

...

A failure in this regard opens them up to legal actions on behalf of those that have pledged, which I would assume includes backers using legally available options to recoup losses ( Charge-back is a legal means of action in this scenario as plans outlined have not been met, as well as could be argued not communicated properly)...

I always smile when I read these very righteous assertions.

Where does anyone think the refund money will come from in the event that a Kickstarter project fails ?

The KS pledges are intended to fund the expenses of the project. That money is not kept in escrow so that it can be given back in the event of failure. It is spent on an ongoing basis to pay project costs.

If the planning was done correctly, there should be no money left when the project is completed !

Armendius · April 2016

The part about failure is no part of the agreement.

You pledge to a project to can start a production.
And receive a reward back for it if it succeed.

Would be funny if we could buy "shares"and charge back when they failed haha

Its kind of a inbuild risk purchase

Thats why the word and setup pledge from their own direct website is misplaced as they sell a digital container when label it "in stock"

mr1602 · April 2016

SpottyGekko said:

Distopia said:

...

A failure in this regard opens them up to legal actions on behalf of those that have pledged, which I would assume includes backers using legally available options to recoup losses ( Charge-back is a legal means of action in this scenario as plans outlined have not been met, as well as could be argued not communicated properly)...

I always smile when I read these very righteous assertions.

Where does anyone think the refund money will come from in the event that a Kickstarter project fails ?

The KS pledges are intended to fund the expenses of the project. That money is not kept in escrow so that it can be given back in the event of failure. It is spent on an ongoing basis to pay project costs.

If the planning was done correctly, there should be no money left when the project is completed !

We keep on hearing that CIG are breaking records and have raised $112 million.
The Kickstarter raised $2.1m. If CIG is refusing to refund the customers because it spent it all, they have bigger problems.

Planning? Let me direct you to the OP of this thread or the last 10FTC episode. Have you heard about Star Citizen?

Asm0deus · April 2016

mr1602 said:

...snip...

TLDR; whatever anyone says is irrelevant. If it has VAT, it can't be a donation.

Crowdfunding donations fall under several categories. The problem is some of you are getting confused by terminology.

http://www.tax-news.com/news/EU_States_Agree_VAT_Rules_For_Crowdfunding____69706.html

and

http://eurocrowd.org/2015/11/23/vat-and-crowdfunding-the-eu-rules/

Back in April, the European Commission had asked the EU VAT Committee, composed by representatives from EU member states and the Commission itself, to discuss the VAT treatment of crowdfunding activities. This month the Committee has released the outcome of its work, which includes the following main conclusions.

Donation Crowdfunding: freely given donations for which no benefit is given in return falls outside the scope of VAT.
Reward Crowdfunding: according to the Committee, the transaction where the backer receives, in exchange of financial contribution, a non financial reward in the form of goods or services by the project owner is VAT taxable, provided that there is a direct link between the supply of goods or services and its corresponding consideration collected by way of crowdfunding, and that the entrepreneur is a taxable person acting as such. However,when the open market value of the good or service supplied by the project owner to the backer is lower than the financial contribution and the benefits deriving from such good or service are negligible or totally unrelated to the amount of the contribution, in this case the transaction can be treated as a donation and therefore not taxable. The VAT will be chargeable upon receipt of the payment.
Equity Crowdfunding: when the investor receives in exchange of a financial contribution a financial reward, in the form of securities, shares or bonds, this transaction is exempt from VAT. An exceptional case to this guideline is when the financial reward received by the contributor of a crowdfunding campaign from the entrepreneur takes the form of participation in future profits by means of intellectual property rights.
Lending Crowdfunding: when a contributor to a crowdfunding campaign receives a financial reward in the form of interest payments on a loan, such transaction is exempt to VAT payment.

The VAT Committee has also stated that the fundraising services provided by crowdfunding platforms to entrepreneurs are VAT Chargeable.

When you "donate" in crowdfunding when it comes to EU law it is further and more accurately sub divided into different categories in which some of the "donations" become susceptible to VAT.

This subdividing of "donations" into these categories is so the Union can make more money by charging you VAT even though they can't technically say you are "purchasing" anything which is why they call the person donating the "contributor" and decided to call this type of crowdfunding "reward crowdfunding" etc yada yada.

mr1602 · April 2016

Armendius said:

uhm this is a strange thought.

The time where you buy something on a website, is the agreement between all parties.

I'm sure the agreement between KickStarter and CIG was not open to anyone who backed the project.
There can be assumptions but it is never 100% certainty as backers do not have '1st hand knowledge' as to the that agreement. Backers would be considered "3rd parties" between CIG and KS.

Armendius · April 2016

mr1602 said:

Armendius said:

uhm this is a strange thought.

The time where you buy something on a website, is the agreement between all parties.

I'm sure the agreement between KickStarter and CIG was not open to anyone who backed the project.
There can be assumptions but it is never 100% certainty as backers do not have '1st hand knowledge' as to the that agreement. Backers would be considered "3rd parties" between CIG and KS.

A pledge is in its nature the same as "shares"

Its a risk purchase, can you charge back shares when a company failed?.

DKLond · April 2016

Some people tend to confuse themselves into thinking a pledge for a Kickstarter means everything will go according to their own imagination and desire - and if something doesn't - they're automatically entitled to a refund.

Essentially, people don't understand that being unreasonable isn't necessarily endorsed or supported by all developers.

They can bitch, moan and whine about it all day long - but it won't change anything.

Howdy, Stranger!

Charge Back and Refunds

Comments

"We all do the best we can based on life experience, point of view, and our ability to believe in ourselves." - Naropa "We don't see things as they are, we see them as we are." SR Covey

"We all do the best we can based on life experience, point of view, and our ability to believe in ourselves." - Naropa "We don't see things as they are, we see them as we are." SR Covey

This have been a good conversation

Howdy, Stranger!

Quick Links

Charge Back and Refunds

Comments

"We all do the best we can based on life experience, point of view, and our ability to believe in ourselves." - Naropa "We don't see things as they are, we see them as we are." SR Covey

"We all do the best we can based on life experience, point of view, and our ability to believe in ourselves." - Naropa "We don't see things as they are, we see them as we are." SR Covey

This have been a good conversation