My Wadiz/Tumblbug campaign overshot its goal — when should I recognize the revenue?
Funding contributions are essentially a pre-order/advance-payment in substance, so the principle is to recognize revenue when the reward is actually shipped or delivered — not when the campaign succeeds. Even if extra production and shipping is delayed because you overshot the goal, recording the entire amount as revenue all at once per the original plan can tangle the timing; we recommend deducting the platform fee separately from the total contribution amount and tracking revenue precisely based on the actual shipping-completion date.
Characteristics of Crowdfunding Income Structure
Key Deductible Expense Items
Tax Advantages for Crowdfunding Makers
Manage your tax burden by recognizing revenue at shipping time
Rather than recording the entire funded amount as revenue all at once, recognizing revenue as rewards are actually delivered lets you manage your tax burden more precisely when the timeline spans fiscal years.
Treat the platform fee as a separate expense
You must keep to the structure of recording the total contribution amount — not the settled amount — as revenue, and treating the platform fee as a separate necessary expense.
Consolidate channels if you move into regular sales
If you continue into regular sales on your own store or Smart Store after the campaign, you must manage funding revenue and regular sales revenue together to avoid missed filings.
The Most Common Mistake We See
It's common to record the entire amount raised as revenue all at once when the campaign ends, or to keep recognizing revenue on the original schedule even when extra production and shipping is delayed after overshooting the goal. It's safest to manage revenue based on the actual reward-delivery (shipping) date.