A couple of weeks ago, Apple announced a new initiative called App Store Small Business Program that saw Apple reduce the commission rate it charges for applications on App Store from 30% to 15%. Well, the company has now started the enrolment process for its program that aims to help developers and small businesses that earn less than a million per year from their apps. Apple started the program after taking into consideration that 2020 was a bad year for many in the App Store developers community.
“Enrollment is now open for the new App Store Small Business Program, designed to accelerate innovation and help propel your small business forward. Featuring a reduced commission rate of 15% on paid apps and in-app purchases, this program helps you invest more resources into your business so you can continue building great apps,” Apple notes.
In order to qualify for the program, a developer shouldn’t have made more than 1 million dollars from all of their apps combined in the last 12 months throughout the 2020 fiscal year. Those who are deemed eligible will have to pay 15% commission for paid apps and in-app purchases to Apple, instead of the standard 30% fee.
In case a developer who qualifies for the 15% tax reduction makes more than $1 million in the subsequent fiscal year, the standard 30% App Store will be levied for the remainder of the year as soon as they touch that threshold. Additionally, developers whose earnings fall below the one million dollar mark in the future, they can again apply for the program and pay the lower 15% commission to Apple.
If you’re a developer, Apple has set a deadline of December 18, 2020 for accepting applications towards the App Store Small Business Program, provided their proceeds are adjusted by 1st January next year. As per estimates by analytics firm Sensor Tower’s data, almost 98% of developers will qualify for the program since they account for only 5% of the App Store revenues.