Amazon removes minimum payment thresholds

Amazon announced today that they have removed the minimum payment thresholds for all sale jurisdictions except Brazil; the amount for Brazil remains at R$20.00 for Brazilian publishers and $100/£100/€100 for non-Brazilian publishers. Note this new payment schedule applies only to authors receiving KDP royalties by electronic funds transfer (EFT). Authors with below-minimum royalties currently held in trust will receive payment shortly.

This comes just as I was preparing to look into the legality of Amazon withholding payment after the year in which royalties are earned. This practice placed authors in an awkward situation tax-wise since one legally has to declare anything earned within the tax year, even if those earnings are not yet paid. (I suspect most authors simply ignored this, figuring what the tax man doesn’t know can’t hurt you.) It also raised serious ethical questions because of the vast sums that must have accrued in Amazon’s coffers, earning them interest, interest that was not then paid to the author once the threshold was met and payment made. Of course, authors who have elected to be paid by cheque still have these issues unresolved.

I am curious to know what prompted this change, whether it were in response to competitor Kobo paying at least twice yearly even if minimums have not been met, or whether this is in response to a legal challenge threatened or initiated. Whatever the reason, this is welcome news.

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