Etsy Fees Explained: What You Actually Keep in 2026
Guide · 2026-10-17
Etsy does not charge one fee. It charges four, and three of them apply to the shipping you charge the buyer. That is why so many sellers are surprised by their payout.
The four fees, in order of impact
| Fee | Rate | Charged on |
|---|---|---|
| Transaction fee | 6.5% | Item price + shipping |
| Payment processing | 3% + $0.25 | Total order value (US) |
| Listing fee | $0.20 | Per listing, per 4 months |
| Offsite ads | 15% | Attributed sales only |
A worked example
You sell a $25 item and charge $5 shipping. Your product cost is $8.
- Revenue: $30.00
- Transaction fee (6.5% of $30): $1.95
- Payment processing (3% of $30 + $0.25): $1.15
- Listing fee: $0.20
- Total fees: $3.30
- Product cost: $8.00
- Net profit: $18.70
That is a 62% margin, which looks healthy until you notice the fees consumed 11% of revenue on a small order. On a $10 item with $3 shipping, the fixed components ($0.25 payment + $0.20 listing) alone eat 3.5% before any percentage fee applies.
The shipping trap
Because the transaction fee applies to shipping, charging shipping separately is not free. A $5 shipping charge costs you $0.33 in transaction fee plus $0.15 in payment processing. If your actual postage is $4.80, you lose money on the shipping line.
The fix is to price shipping into the item price, or to use calculated shipping that passes the true cost through. Either way, model it rather than hoping.
Offsite ads are mandatory above $10k
Once you cross $10,000 in annual sales, Etsy's offsite ads program becomes mandatory. You pay 15% on sales attributed to Etsy's external advertising, dropping to 12% above $10,000. Sellers who never modelled this see their margin fall by several points overnight when they scale.
The pricing formula that survives fees
Work backwards from your target margin instead of adding a markup to cost:
price = (cost + fixed_fees) / (1 - percentage_fees - target_margin)
For a $8 cost item, $0.45 of fixed fees, 9.5% of percentage fees and a 40% target margin, the price works out to about $23.70. Add shipping on top or build it in, but do not guess.