Is there a difference in how (much) of the money makes it to the devs?
Also, the license subscription states “Running IPFire in your company but you don’t need support? Subscribe!” which suggests it doesn’t really offer anything different to a donation.
I’m assuming the donate option is more suitable for the casual / home user, whereas if someone is using it in a SoHo / business / office / commercial scenario and is willing to purchase rather than donate via a business it is easier to justify as a business expense and use it as a tax deductible item?
I have a reasons for asking, more related to the example above than wondering about how the money is filtered differently, but equally am interested if there is a substantial difference what percentage of the money the devs loose out on using either option.
thank you very much for checking out our online store
The product that you discovered there is currently in a bit of a trial phase. It is indeed very similar to a donation in that sense that you will support development and all the other awesome things that a donation enables us to do.
The difference is tax law. A donation is something that doesn’t exist in most European country’s tax law for for-profit organizations and so it is impossible for many companies to support the project. The Open Source License changes that.
It is a way for businesses to support us - on a regular basis and without any extra bureaucracy. You simply buy the license and that is it. It will help both sides.
Donations will however not go away and are a great way for individuals to support us and we appreciate everyone who throws a couple of bucks into the hat. It helps us out a lot.
The money is going into the same basket on our end and will fund the project. There is no difference there.
The whole donation process seems to be falling victim of a lot of bureaucracy. There is a lot of stuff to consider depending on the person who is donating.
We do not take donations in the sense of German law, because IPFire does not have the status of a charity. That would however come with lots more paperwork which we do not want to do and we would not gain anything from changing our status.
Because there is more and more fraud with online transactions, we have to collect names of our donors. We have to collect the address because we need to tax donors correctly. Donors from the EU will pay their local VAT rate (for Germany that is currently 19%, Poland is 23% and so on…), and donors from outside the EU won’t pay VAT at all. VAT is also not paid by businesses from the EU if they have a VAT ID.
Luckily, you won’t have to take care about this. You just fill in the donation form and hit the “Donate” button. But behind the scenes, we have been working really hard to make the donation process first of all compliant, and workable for individuals and businesses alike.
So, I am happy to get feedback on all of this. There is probably still plenty that we can improve. I would say many things probably feel a little bit unusual (we will send you an “order confirmation”, because otherwise we are not allowed to charge your credit card for example).
Since we have plenty of people who are using IPFire and practice better privacy than other users, I understand that submitting this information might be a problem. And I do not know what the alternative could be.
In the end, we don’t want to make this whole process more complicated than it has to be. But we also need you to donate and not refrain from that because the form looks scary. Businesses stay away from donating because it is causing extra paperwork for them, too.
So, please, if you can, donate! It really helps us to make IPFire better.
@ms Just a curiosity. If someone mails to your office 100 Euro in cash and a note stating this is a donation for IPFire development, without any Identity and return address, what are you supposed to do to stay compliant with German law?
Interesting question. So, the reason we need the address simply is VAT.
If you purchase something in Germany, you will be charged 19% VAT - no matter who you are (exceptions apply, but probably don’t matter in this context).
If there was an envelope with no sender, then I would probably have to assume that VAT is chargeable at the 19% rate which means that the donation becomes 81 EUR, and 19 EUR go to the tax people.
I would doubt that it would be acceptable that if there was a US post stamp on the envelope for example. If the letter had a sender, then I would say, it is safe to use the sender’s address.
I don’t really want to shit all over the German tax system. In general, it is not that bad. It is quite modern compared to many other countries, and it generally works. However, it is not made for donations and not for the modern age of world-wide transactions. And that is where we see this.
One thing I would have to add though is: It does not matter in which street you are living for tax purposes. What matters is the country. You should probably pick that correctly, but we don’t check if any entered addresses exists. Some people live in “18 shajkfhjks” which might cause us some trouble at the next audit. I would personally live in “18 Liverpool Street” or “Hauptstraße 12”.
There are very few privacy-aware companies that take cash payments by snail mail. I believe that isn’t a great system either.
As a lone end user, I like IPFire & the donation feature, but… all this talk about commercial support makes me wonder how much money IPFire is making ? Please post your revenue and expense numbers when asking for a donation ?
I do not find it acceptable to make these types of requests (in my humble opinion), especially when no one forces anyone to make any type of donation. The one who donates, is because he wants to or because he can, since I for example, although I contribute little monthly, but I contribute, and I would feel bad if I am benefiting from the efforts of others for my own good.
Certain points must be taken into account:
It is free software.
There are expenses of all kinds (rent, energy, hardware, etc…).
Those who contribute their effort, do so altruistically and if in the end, of all the income from donations, if they have something left, all the better.
The community is great and members, to the best of their ability, go out of their way to help.
What makes you think you are entitled to this kind of information? When ipfire.org will be a publicly traded company and you buy some of their stocks, then you will receive a quarterly report with what you are asking here and more. Until then, you are only entitled to a full refund of the 0 eur commercial value of IPFire software product you downloaded, for the total value of 0 eur.
I appreciate the discussion. Generally, as an organisation, I would like to be able to publish some kind of transparency report. However, that is a lot of work, and although it is nice to have, it is moving the project forward by much.
So in short, I don’t have those figures, and right now, I do not want to invest the time to get them together. You would have to take my word for it, that we do not get enough donations.
I would like to add to this, that very often, when we publish certain decisions, we get private emails about how it was the wrong decision. Let’s say I would have a company make red balloons with an IPFire logo on it, there would be a discussion about the logo, the colour of the balloon and that it cost too much and that “I know a guy who knows a guy who can make them for half the money”. If we indulge in those conversations, we would even have less development time.
Yes it is. Free as in freedom and not as in beer.
We basically do not buy any hardware any more. We have a couple of servers that we own, but that is not a lot. Most of those expenses are indeed hosting, which can be split into space, energy and bandwidth. Especially energy is going up rapidly at the moment.
These costs are however covered by the donations that we are getting as they are not very high. I think we run a very efficient hosting setup.
This is where it gets more interesting. If I could, I would spend more time on development. However, that is not paid time - and at the end of the day, everyone who contributes to the project has their fridge to fill and their rent to pay.
Some people have a day job and do this after or have their employers permission to spend time on IPFire during work time. But obviously with that, you won’t get much done.
Our goal would be to hire people full time to not worry about anything else but IPFire. That is something that is currently very very far away.
Exactly. You are free to use IPFire and not spend a penny on us. But then you won’t help to keep things going here, which I would personally find sad. We are doing something great here and so many people are benefitting from it. Some more, some less. Some have more money to spend, some have less. I know you get that.
So, to sum up, I can only ask everyone to donate as much as they can. You will have to trust us that we are not spending it on a holiday to the Caribbean. It is as simple as that.
I think the product speaks for itself, but of course we can do a lot better still…
I appreciate the conversation. Funding Open Source projects is hard. But let’s please keep it civilised at put the project first
I am in the USA and just made a small donation via credit card to say thank you for the help.
Please consider adding the top level links shown on the top of the www.ipfire.org web page
to the top of the forum the forum web page to help users find stuff… Thanks.