What Are The Etsy Fees For Digital Products? The Best Way To Avoid Excess Charges (2024)

One of the biggest complaints about selling digital products on Etsy is the large number of fees. This article will detail exactly what are the Etsy fees for digital products, and how they may effect your Etsy store.

Etsy has a long list of fees which can be confusing at best. Many sellers are left wondering what the Etsy fees that will apply to them as digital product sellers.

What are the Etsy Fees For Digital Products?

Etsy has a long list of fees. Luckily, not all fees will apply to digital downloads. It can be overwhelming at first, but as you will learn many of the fees are optional, while others don’t apply to all sales. You can see the full list of Etsy fees on their website, buy you should note that not all fees will apply to digital sellers. The main types of fees included on Etsy include:

• Shop opening Fee (New 2024)
• Listing Fees
• Transaction Fees
• Advertising and Promotional Fees
  • Etsy Ad Fees
  • Offsite Ad Fees
• Subscription Fees
• In person Selling Fees
• Payment processing Fees
• Delivery Fees
• Regulatory Operating Fees
• Pattern Fees
• Currency Conversion Fees
• Taxes

What are the compulsory Etsy fees for digital products?

We can narrow down the list quite a bit, by only including compulsory fees charged to digital product sellers.

New Etsy Shop Opening Fee

As of Early 2024 – Etsy has introduced a new one -time set-up fee of $15USD (or equivalent in your local currency). This was introduced due to a huge influx of scammers and, as should be welcomed by anyone who is serious about running a business. It will not only help to reduce scam shops, but also help avoid the influx of low effort stores that take away valuable search positioning on Etsy.

Up Front Fees on Etsy

Listing Fees: Listing fees are the only compulsory fees that you will be required to pay upfront. That is: You will have to pay listing fees, whether your product sells or not. “You will be charged a listing fee of 0.20 USD for each item that you list for sale on Etsy.com or Etsy’s mobile apps.”

If you list multiple quantities of the same item, the initial listing fee will be 0.20 USD, and the listing will be automatically renewed at 0.20 after each of the items sells. Some sellers get confused on this point when selecting the quantity digital products on Etsy.

So what does this mean? Essentially, you will have to pay 20c for each product you list, and if you intend to sell your product more than once, another 20c per sale. For digital products, this will mean a 20c charge each time you sell your product with auto-listing enabled. I always recommend leaving auto renew on for instant download digital products – there really is no reason not to.

After Sale Fees on Etsy

After sales fees will only happen once a purchase has been made. This is especially great for new sellers, who are hesitant about spending large sums of money to get their business off the ground.

Transaction Fees: When selling digital products on Etsy, will be charged a transaction fee of 6.5% of the price you display for each listing.

Payment Processing Fees: When using Etsy payments (which I will always recommend if your country has the option), you will be charged a payment processing fee. Payment processing fees vary based on the location of your bank account, and can be anywhere between 3-5% + a small charge. The US for example, charges 3% + 0.25 USD.

Offiste Ad Fees: Etsy will purchase and run ads on other websites (such as google or social media) automatically. If your shop has made less than $10,000 USD in sales over the past year, you have the option to turn this off. As a digital seller, strongly recommend to keep this on – chances are you will get extra sales. Importantly, as you have no manufacturing costs, you will still be making a profit with each sale even with Offsite Ad fees.

You will be charged 15% for all attributed orders (if you are under the $10,000 USD threshold). What this means is that, if a customer is to click on Etsy’s ad on another website, and go on to purchase your item – you will be charged an additional 15%.

Once you cross the $10,000 USD threshold (meaning you are unable to opt out of this feature), the fee will drop down to 12%.

Taxes (VAT/GST/HST): Etsy collects and remits VAT on digital items purchased by buyers located in certain countries. Buyers pay VAT as part of their total purchase price when buying digital items. Technically, this means that the price tax is ‘added’ so you will still earn the same amount (prior to other fees). Etsy will take the VAT paid by the buyer and remit to the relevant tax authorities. Sellers are not responsible for adding VAT to their digital listing prices.

For all other taxes, it is up to the seller to collect and pay any taxes associated with using and making sales through Etsy’s services

Regulatory operating fees: A small number of countries will be charged a regulatory operating fee. This fee is generally quite small (between 0.25-1.1%). Regulatory Operating fee is a fixed percentage of the price you display for each listing.

Additional / optional fees you may be charged on Etsy

Etsy also has a number of fees that you may be charged in your monthly statement, depending on whether you choose to use these features or not.

Etsy Plus

Etsy plus is an opt-in service that will cost you a flat fee of $10 USD per month. In Etsy’s words, “Etsy plus allows for greater control and customization over your shop. Etsy Plus includes credits for shop listings and Etsy Ads, access to custom web address discounts, restock requests, advanced shop customization, and more.” By no means is Etsy plus a requirement to run a successful shop, and most sellers will tend to go without until they start seeing a consistent and sustainable monthly income.

Etsy Marketing

Etsy gives you the option to run ads through their platform. Even after 90,000+ orders across all my stores, I still struggle to make my ads profitable. Etsy gives little to no customisation options while running the ads (except for your daily budget and list of products you wish to advertise). Other than that, it is up to them. If you decide to advertise your product using Etsy ads, your monthly fees will include your ad spend.

Avoidable Fees on Etsy

There is one fee which is easily avoidable as a digital product seller on Etsy. The Currency Conversion Fee. This 2.5% fee will only be charged when a seller lists and subsequently sells an item in a currency other than the currency of the seller’s payment account. For example, if you run your shop from Australia (payment account) but list your products in USD (Listed currency). This is an easily avoidable, extra charge – just make sure that all currencies are set to your home country / banks currency.

How much does etsy charge to sell digital products

Etsy charges an upfront listing fee of $0.20. Whether your item sells or not, you will be charged this amount for each digital download you add to your shop. You will also be charged a one time payment of $15USD to set up your shop.

Once a product is sold, Etsy will then add on a number of fees (including a transaction fee of 6.5%, payment processing fees of 3-5%, and taxes). If you choose to your digital product more than once, you will also be charged another listing fee of $0.20 for each product sold.

Conclusion

There is no denying that Etsy has a large number of fees to navigate. Luckily, as digital product sellers, we get to avoid a number of fees. Despite a number of compulsory fees, selling digital products is one of the best ways to make an income, and remains a profitable side hustle (or full time income).