Formula to calculate fee coverage for Paddle for a given subtotal and VAT percentage. Also takes a source and target currency to add fee conversion fees. The source currency is the buyer currency, the target currency is your account balance currency. Note that with a payout, if your bank account's currency is different from your Paddle account c…

paddle-cover-fees.py

"""

total = 2500
tax = 399
subtotal = total - tax
vat_percent = tax / subtotal = 0.19
wanted_revenue = total - tax = 2101  # revenue without fees

new_subtotal = subtotal + X
new_tax = new_subtotal * vat_percent
new_total = new_subtotal + new_tax
wanted_revenue = new_total - new_tax - new_total * 0.05 - 50

solve for X:
wanted_revenue = new_total - new_tax - new_total * 0.05 - 50
wanted_revenue = new_total * 0.95 - new_tax - 50
wanted_revenue = (new_subtotal + new_tax) * 0.95 - new_tax - 50
wanted_revenue = new_subtotal * 0.95 + new_tax * 0.95 - new_tax - 50
wanted_revenue = new_subtotal * 0.95 - new_tax * 0.05 - 50
wanted_revenue = new_subtotal * 0.95 - new_subtotal * vat_percent * 0.05 - 50
wanted_revenue = new_subtotal * (0.95 - vat_percent * 0.05) - 50
wanted_revenue = (subtotal + X) * (0.95 - vat_percent * 0.05) - 50
wanted_revenue + 50 = (subtotal + X) * (0.95 - vat_percent * 0.05)

(wanted_revenue + 50) / (0.95 - vat_percent * 0.05) = (subtotal + X)
(wanted_revenue + 50) / (0.95 - vat_percent * 0.05) - subtotal = X

solve for X (with 0.05 being a variable):
F = 0.05
wanted_revenue = new_total - new_tax - new_total * F - 50
wanted_revenue = new_total * (1 - F) - new_tax - 50
wanted_revenue = (new_subtotal + new_tax) * (1 - F) - new_tax - 50
wanted_revenue = new_subtotal * (1 - F) + new_tax * (1 - F) - new_tax - 50
wanted_revenue = new_subtotal * (1 - F) - new_tax * F - 50
wanted_revenue = new_subtotal * (1 - F) - new_subtotal * vat_percent * F - 50
wanted_revenue = new_subtotal * ((1 - F) - vat_percent * F) - 50
wanted_revenue = (subtotal + X) * ((1 - F) - vat_percent * F) - 50
wanted_revenue + 50 = (subtotal + X) * ((1 - F) - vat_percent * F)
(wanted_revenue + 50) / ((1 - F) - vat_percent * F) = subtotal + X
(wanted_revenue + 50) / ((1 - F) - vat_percent * F) - subtotal = X
(wanted_revenue + 50) / (1 + (-F) + vat_percent * (-F)) - subtotal = X
(wanted_revenue + 50) / (1 + (-F) * (1 + vat_percent)) - subtotal = X
(wanted_revenue + 50) / (1 - F * (1 + vat_percent)) - subtotal = X
X = (wanted_revenue + 50) / (1 - F * (1 + vat_percent)) - subtotal
X = (subtotal + 50) / (1 - F * (1 + vat_percent)) - subtotal

"""

# Platform fees: https://www.paddle.com/pricing
# Currency conversion fees (2-3%): https://www.paddle.com/legal/terms
PADDLE_BASE_FEE_FACTOR = 0.05
PADDLE_BASE_FEE_CENTS = 50
PADDLE_CONVERSION_BASE_FEE_FACTOR = 0.03
PADDLE_CONVERSION_FEE_FACTORS = {
    "USD": 0.02,
    "EUR": 0.02,
    "GBP": 0.02,
    "CZK": 0.025,
    "DKK": 0.025,
    "NOK": 0.025,
    "THB": 0.025,
}


# subtotal is in cents
def calculate_fee_coverage_cents_external(
    subtotal: int,
    vat_percent: float,
    source_currency_code: str | None = None,
    target_currency_code: str | None = None,
) -> int:
    fee_factor = PADDLE_BASE_FEE_FACTOR
    if (
        source_currency_code
        and target_currency_code
        and source_currency_code != target_currency_code
    ):
        target_currency_code = target_currency_code.strip().upper()
        if target_currency_code in PADDLE_CONVERSION_FEE_FACTORS:
            fee_factor += PADDLE_CONVERSION_FEE_FACTORS[target_currency_code]
        else:
            fee_factor += PADDLE_CONVERSION_BASE_FEE_FACTOR
    coverage = (subtotal + PADDLE_BASE_FEE_CENTS) / (
        1 - fee_factor * (1 + vat_percent)
    ) - subtotal
    print(
        "fee coverage:",
        coverage,
        source_currency_code,
        target_currency_code,
        fee_factor,
        file=sys.stderr,
    )
    return int(Decimal(coverage).quantize(Decimal("1"), rounding=decimal.ROUND_HALF_UP))