If make games with unreal engine 4 and make it free, i don’t have to pay back right? 2nd question, if i do make games and sell it, i have to pay $150 for every $3,000 per product, per quarter if i reach that limit then i pay it back right? still new to this stuff and just wanted to make sure.
There is no cost to use UE4, if you make your game free then you do not have to pay any royalty.
If you sell your game, then you must pay a 5% royalty if you make more than $3,000 a quarter(a quarter meaning a quarter of a year), if you make more than $3,000 a quarter then you have to pay 5% royalty on any amount above $3,000. So if you make $4,000 then you would only pay 5% royalty on $1,000. And again, that gets counted each quarter of the year.
As for your first question, if you release the game free and make no money from it in any way then yes you owe Epic nothing.
If you make $3,000 per product per quarter you pay absolutely nothing to Epic. The 5% is only applied AFTER the first $3,000.
So like in Darthviper’s example, if you make $4,000 every quarter you will only need to pay $50 back to Epic.
Even if you made an amazing $33,000 per quarter you’d still only pay them $1,500 back.
thank you all for answering me, faster than the community at cryengine.
Hi! I’m new to the engine and I have some questions: If I did make more than $3,000 how should I make the payment? How would Epic Games know if I’m making any money at all? Thanks.
As you are obligated pay them if you make money of a game. (i pretty much just simplified what the terms tell you to do) If you don’t and you try to cheat it, then pretty much you are doing something illegal and a law suit would be filed against you where you would lose the moment you would put your foot inside the doors to the court room and you wouldn’t be able to sell the game at all on steam, g2a etc.
Besides i don’t see any reason to why you shouldn’t pay the 5% as if it wasn’t for The engine you wouldn’t even make any money of the game.
5% is an incredible deal for the total amount of man hours that have been and are being put into the engine. There are some differences, for example I believe if the end result is purely a video rendering that you made money from on youtube as an example, there is no royalty fee required. Software applications and games, do however require the 5% royalty. I recommend reading the FAQ for more info, and also read the legal EULA Frequently Asked Questions - Unreal Engine
For example, you’ll notice in the FAQ you can contact Epic Games to try and negotiate a different deal, if say for example you’re a large AAA studio at EA Games and a 5% royalty could actually be millions instead of $150 ($150 being the amount if you made exactly $3,000 as a total) It’s also 5% on gross, not net profits, so it would be 5% on the pre-tax net sales minus cost of sales. I haven’t finished a product to sell yet, and am by no means a tax expert though so please read and seek financial advisers if you’re serious about selling.
Also, keep in mind whatever money you make is also subject to the tax regulations of the country or state you currently live in, and also if you chose to sell on steam you’d also have steam or whatever publisher take a percentage (25%-30%, not sure?).
I’ve also read if you’re going to sell an actual game, it might be best both legally and for tax purposes to set yourself up as a legal business entity such as a Limited-Liability Company. (You can be a LLC even as one person) I believe this option helps protect you from say, being sued by some crazy person on the internet directly. They can only sue your company, not you, and thus the amount of money you paid yourself as a salary and your personal belongings/real-estate/etc. can’t be touched. It also gives you more options with how you pay yourself and deal with different methods of filing your taxes. Again, by noooooo means an expert this is just what I read online.
Long story short, 5% is the smallest piece of the pie you’re going to have to worry about, and for 5% you’re getting a heck of a lot in return. Best of luck!
We have to be thankful to the biggest studios using UE4 to build some of their games; ultimately they are the ones paying the bills and allowing UE4 to stay “free to use” and keep on growing fast.
And the best thing is everyone trully gets the exact same software… No feature removal, no enforced degrading splash-screens and no monthly fees. 5% for a deal like this is too good!
Yeah Its pretty good deal for indie game developers who just started with no money in hands!
uhum…that would be Fortnite these days 
and Epic technically takes more like 10 percent not 5% :)…
They pull the plug before all other net income into your company, percentages and taxation this is an important note to take into consideration for newcomers, they should be aware of and read in the agreements.
In other words say you sold your game for 100$
Steam takes 30% from 100$
Taxes ex. 20% from 70$…
You are left with 50$ net profit from the game sold.
Epic takes 5% from 100$ and not from the 50$
Which will leave you roughly with 45$ as net income and not 47.5$
An important distinction.
Hey everyone .
i have question about pay to Epic .
i now busy for make a game with UE4 . please tell me when my game be finished then i want to konw publish it for example how Epic can know about my sell amount and then take money of me ?
maybe at this engine is one spy that send all status to them and then they can understand how much money i made.
thanks
As stated in the UE4 FAQ:
Failing to notify Epic that you have begun to sell your product would leave you open to legal ramifications.
The engine source code is freely available.
If there was any spyware in there, it would have been discovered years ago
so if they charge less than your game price