Do you want to become a Minecraft server owner, but want to make sure that server donations are legal in Minecraft?
We have got your back and will help you understand the legality of donations on Minecraft servers.
Table of Contents
Are Minecraft server donations illegal?
Accepting donations on your Minecraft server is legal if you follow certain guidelines, such as the Mojang EULA (for using Minecraft’s intellectual property), and the donations & taxes laws in your country.
EULA-compliant server donations
The first thing you need to do is be EULA-compliant to make legal donations on Minecraft servers. For compliance with the EULA, you need your server to be:
1. Non-Pay-To-Win: In Mojang’s guidelines it is stated that items or perks should not give any advantages to players who donate to your server. This leaves a huge gap between the paying, and non-paying communities, leaving one side of your player base with disadvantages.
Instead, Mojang entices its intellectual property users to sell items and perks, such as pets, cosmetics, particles, loot crates, or even commands, that don’t make a player overpowered.
2. Transparency in donations: When selling items in your store, you must clearly outline what the sold item is and show players what they will receive for the sum they are paying. Even the taxes should be outlined before the purchase has been completed. A great way to do that is by setting taxes on checkout or using our donations plugin.
3. Tax Implications: Depending on the country you reside in, taxes may be applied, and your server income may be considered as taxable. Before accepting donations, you will need to speak with a legal authority to inquire if taxes apply to you, and what is the amount of taxes you have to pay for operating, and earning from your server.
Taxes and Laws for Minecraft Donations
The taxes and laws for Minecraft server donations vary by country, and depend on factors such as the type of income, tax thresholds, and if your income is considered as business or personal.
For example, we have outlined a few of the countries, that have given the income classification, and the estimated tax rates you should be paying for receiving Minecraft donations legally.
| Country | Taxable Income Classification | Estimated Tax Rate |
| United States | Business Income (if profiting) | 15.3% self-employment tax + federal income tax, which varies by bracket (10%-37%) |
| Canada | Business Income | Varies by province, federal rates from 15%-33% for individuals; GST/HST may apply |
| United Kingdom | Self-employment income (if profit exceeds £1,000) | Class 2 and 4 National Insurance plus 20%-45% income tax based on income level |
| Australia | Hobby or Business Income | Marginal rates from 19%-45% for individuals, plus GST if annual income is AUD $75,000+ |
| Germany | Freelance/Business Income | Progressive rate from 14%-45% for income tax; trade tax may apply depending on setup |
| France | Professional Income | Progressive rates from 11%-45%, plus social contributions at 9.2% |
| Japan | Miscellaneous/Business Income | Progressive rate from 5%-45%, plus local inhabitant tax around 10% |
| Brazil | Self-employed Income | Progressive rate from 7.5%-27.5%, and a municipal service tax may apply |
| India | Professional Income | Progressive rate from 5%-30% for individuals; GST may apply based on revenue |
| South Africa | Freelance/Business Income | Progressive rate from 18%-45% depending on income |
If you want to check the amount of taxes you will have to pay for accepting donations legally on your Minecraft server, you can use a tax service such as TaxSummaries, or consult with your local tax authorities.
Rad is the lead writer for the MineLabz team, dedicated to writing content for Minecraft enthusiasts. Combining Minecraft and Marketing, Rad creates all kinds of articles for the server development community.
