Caution

Creator Bears All Taxes

Broad tax allocation shifts sales tax, withholding, and potentially employer taxes to Creator; net is below the headline.

Show it
Look in the tax, payments, or general terms section for phrases like "Creator is responsible for all taxes", "fee is inclusive of all taxes", "Creator shall bear all levies", "taxes of any kind", or "fee is gross of any tax".
Decode it
Contractor arrangements typically allocate income tax to the contractor. Broad catch-all language expands that floor - to include sales tax, GST, VAT, and sometimes employer-style taxes the brand would typically bear. Without gross-up, the headline fee becomes the pre-tax figure and your net is materially lower.
Fix it
Push for: allocation limited to Creator's own income tax; gross-up adjustment so net matches the agreed fee; GST / sales tax / VAT treated as a separate add-on rather than a deduction; explicit exclusion of tax-authority reassessments and penalties from Creator allocation.

What it means

This contract makes you responsible for all taxes arising out of the engagement, not just your own income tax, but potentially sales tax, GST, VAT, withholding tax, or payroll taxes that would ordinarily be the brand's responsibility. The headline fee is the pre-tax figure; your net can be materially lower.

A broad tax clause can leave you paying taxes beyond your own income tax out of the fee. Without gross-up, the headline fee materially overstates creator net.

What to check before you sign

  • ·Does the clause limit allocation to your own income tax, or extend to all taxes?
  • ·Is there a gross-up provision so your net stays at the agreed amount?
  • ·Is sales tax / GST / VAT addressed separately?
  • ·Does the clause sweep in tax-authority reassessments and penalties?
  • ·Is there cross-border withholding exposure?

How to fix it

  • Limit allocation to the creator's own income tax, with all other taxes (sales tax, GST, VAT, withholding, payroll) the brand's responsibility.

  • Add a gross-up provision, if any tax is withheld or imposed on the creator, the fee is increased so the creator nets the agreed amount.

  • Treat GST / sales tax / VAT as a separate add-on to the fee rather than as a deduction.

  • Explicitly exclude tax-authority reassessments, penalties, and interest from the creator allocation.

Negotiating it

A good opening

"Could we limit my share of tax to my own income tax, treat any VAT, GST or sales tax that applies as an addition to the fee, and exclude tax-authority reassessments from my share? "

When to walk away

Creator-bears-all-taxes combined with no gross-up, broad catch-all language sweeping in tax-authority reassessments and penalties, and cross-border engagement structure with withholding exposure, creates a commercial position where creator net is materially below the headline fee and exposed to tax-authority actions years after delivery. Caution signal for high-value engagements where the headline-to-net delta is material.

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Educational guidance, not legal advice. For high-value or complex deals, get independent legal advice from a qualified professional.