Fotolia’s Pricing and Tax Changes

Happy New Year to everyone! Wishing you good health, lots of luck, and success in the Year of the Tiger! And, of course, great success in your work on photobanks, with fewer unpleasant surprises!

Now, let’s discuss the gifts from Fotolia, which aren’t exactly pleasant. The first stock agency to “surprise” us in the new year is Adobe Stock (formerly Fotolia).

First, Fotolia changed its rates unfavorably for microstockers, and second, it started withholding the anticipated tax on U.S. sales.

So, let’s dive into each “gift box” in more detail.

Fotolia’s Updated Pricing Model

Adobe Stock has updated its pricing and commission structures for contributors. Interestingly, while stock prices for buyers have increased, the commission rates for contributors have decreased. It seems Fotolia’s actions are inscrutable. Or perhaps it’s simply prioritizing profit?

Going forward, prices for all image sizes, except the smallest size XS, will increase by 1-2 credits per file. Additionally, the XXL and XXXL sizes are being combined. This affects the Adobe stock buyers.

Regarding contributor payouts, Fotolia’s structure has changed. For most beginners, royalties will decrease, while professionals with substantial income will see an increase.

According to Fotolia’s management, many contributors have experienced a rise in earnings. In essence, this means that higher earners will benefit more, while newcomers may face challenges. Just kidding. It means you’ll need to expand your portfolio more actively to achieve higher earnings.

Below, you can see the new payout structure and prices for non-exclusive authors on Fotolia:

Novice contributors may find the 5% income reduction on Fotolia significant, particularly in light of the platform’s additional changes.

Fotolia Tax Policy

As anticipated at the end of last year, Adobe Stock now withholds a 30% tax on sales to U.S. customers, complying with U.S. tax regulations. Not bad?

The most interesting part is that Fotolia offered everyone to fill out forms to avoid tax on all sales. But it was also written that if the form was filled out correctly and you’re not a US citizen, nothing should be withheld from you. In practice, things turn out differently.

The tax is withheld from anyone who doesn’t have an ITIN — essentially an American ID number. Obtaining an ITIN (Individual Taxpayer Identification Number) involves a detailed application process with the IRS. So, it might make sense to analyze the volume of American sales in your portfolio on Fotolia before worrying about obtaining an ITIN.

Shutterstock also requires contributors to submit tax forms but may have different withholding practices. One might wonder: is this another attempt by Fotolia’s management to increase revenue? Well, what can you do?

Regardless, this won’t reduce the number of authors on Fotolia; there will just be more criticism and discontent. So, dear Fotolia, thank you for securing our future, free from any thoughts of where to spend those extra pennies. Now, those pennies will settle into Fotolia’s pockets.

For beginning microstockers, Adobe Stock remains a viable platform due to its integration with Adobe Creative Cloud and user-friendly interface — even with such New Year “gifts.”

So, let’s keep working, working, and working some more!