One of the most frequent feature requests we’ve gotten over the years is for the ability for authors to handle payment splitting better and easier. Keeping track of who gets paid what percentage of something such as a box set or a multi-author collaboration can be a headache. Figuring out taxes can be a nightmare. So we built D2D Payment Splitting to make all of that much easier. And so far, it’s been a huge success!
You can learn more about D2D Payment Splitting in these blog posts:
- Announcing D2D Payment Splitting!
- D2D Payment Splitting – A walk-thru with Mark Leslie Lefebvre!
- D2D Payment Splitting for Authors and Collaborators // Self Publishing Insiders // EP027
Now that you have the ability to easily split royalty payments between authors, here are some ideas for how to use your new-found superpowers!
First and most obvious, payment splitting will let you and a writing partner split the revenue from book sales without having to do any math in your head. D2D Payment Splitting is already set up and perfect for this, because it makes it as simple as each contributor creating their D2D account (or using their existing account), conducting their tax interview, and agreeing to whatever percentage they agree is fair.
That’s it. Draft2Digital handles all the calculations from there and makes sure each contributor is paid based on the percentage they agreed to. D2D even makes sure that each contributor gets the appropriate tax documents for their part of the world (this, in itself, is a kind of miracle—figuring out how to handle taxes between different countries is a real job of work, trust us!).
To set up payment splitting for co-authors, one of those authors will need to be the Organizer, while all other authors would be Contributors. All Contributors have to agree to the percentage they’ll receive, and that percentage cannot be changed by either the Organizer or the Contributor unless both parties agree to the change. So there are built-in “trust tools” to keep everyone honest.
Shared Universes 2
D2D Payment Splitting is its own unique and powerful tool, but we did build at least part of it on the framework we built for D2D Shared Universes. This was a service we created to replace Amazon’s Kindle Worlds program, when that service was shut down.
The basics: D2D Shared Universes allows the owner of an intellectual property (a series and/or universe) to give other authors some limited rights to publish works in that universe and share the royalties from sales.
On the surface, this sounds a lot like payment splitting, but there are some limitations and challenges that have to be dealt with mostly manually. So we’ve tended to keep this feature a little quiet, especially as we started building D2D Payment Splitting. It still exists, but we impose certain conditions on opting in.
Payment splitting, on the other hand, is open to all D2D authors, and it is easy to set up—as long as all contributing parties have D2D accounts, they can use the service.
Because of this, every author could essentially create their own “shared universe,” simply by becoming an Organizer and allowing other authors to become Contributors. Each author would need a D2D account and would have to conduct the tax interview and supply banking info to receive payment. But once that’s done, the world is your oyster.
For the busy author, one thing that will help with this is our Account Sharing option. If you have an assistant who helps with managing your tasks, you can grant them limited account access so that they have the ability to manage the Organizer side of payment splitting. They don’t get access to any of your financial information but they can help you in managing projects that include outside contributors.
Box Sets, Collections & Anthologies
Another obvious and go-to use for D2D Payment Splitting is the good ol’ box set, or multi-author projects.
Like co-authoring above, we’ve made this simple by boiling it down to the Organizer and Contributor relationships.
So the difference? More authors. That’s it.
You can still set percentages based on individual authors, however, which gives you some interesting options.
First, you can of course split all royalties equally amongst the contributor and all other authors. But alternatively, you can adjust percentages to reflect different stakes of ownership in the project.
For example, let’s say that the Organizer is going to handle all overhead and expenses out of pocket. They take on the cost of editing, cover design, marketing and promotion. The organizer could take a larger percentage of the project to help recoup those expenses.
Another use case: Participating authors may have varying levels of “seniority.” For example, if the Organizer has attracted a “big name” author or two into a box set, those authors could be given a larger percentage than authors who aren’t as well known. This sort of use case might be good for helping to attract and incentivize authors who can bring in new readers for the rest of the contributors. This is a long-game strategy that leverages the “big names” for their clout and provides paid exposure for lesser-known authors.
The flexibility in percentages for collections, anthologies, and box sets opens up many possibilities for Organizers who can put in some creative thinking.
Contributors (Editors, Illustrators, Organizations & More)
Contributions for a book aren’t always limited to co-authors. There are instances in which you might want to share the wealth with the people who helped make a work possible.
For example, if you have a book that relies heavily on illustrations or photos provided by a third party, you may want to provide them with a cut of royalties from sales. The photographer, illustrator, or editor will have to create their own Draft2Digital account and will have to complete the tax and financial portion of setup. But once this is done, you can set up a percentage for them just as you would a co-author.
Charities & Causes
This one gets a little tricker, but it’s something we’re asked about all the time. We do not yet have an easy means for assigning a percentage of your sales to a charitable organization. We’re looking into how that can be done, but at the moment it’s not baked in.
However, this is a workaround.
The organization or cause can share in a percentage if they have created a D2D account and set up their financial information. They will need to complete their tax interview, just like any other contributor, but their tax status will be different. If they need anything specific in order to claim tax exempt status, they will have to contact D2D Customer Support.
This workaround has worked for a few organizations so far, but it might prove challenging if your goal is to donate a percentage to a larger organization or cause. Since they would be required to have a D2D account, some of these larger groups may not be set up to do such things easily. In that case, it might come down to you, the Organizer, making a tax-deductible contribution separately.
You should certainly consult your accountant and/or tax advisor about the best way to handle this.
D2D Payment Splitting still has that new tool smell, so the list of use cases above is hardly comprehensive. The truth is, the ways in which you can use this are limited only by your imagination, and of course by the laws and regulations in your part of the world.
But with some creative thinking, you’re certain to be able to put this to work for you in ways we couldn’t even have anticipated.
To get started using D2D Payment Splitting, all you have to do is start a project. In Step 1: Details you’ll have an option to add a Contributor. It’s pretty easy from there.
Tell Us How You’re Using D2D Payment Splitting!
We want to hear all of your creative uses for D2D Payment splitting, so leave a comment below! This tool was built with you in mind—the creative-thinking author who needs a way to share the wealth. We can’t wait to see what you come up with!