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Today we are going to talk about Book Royalties because if you are an author then this is a very important topic for you. There are a lot of misconceptions regarding book royalties and today we are going to dispel them once and for all. So, let us begin this blog wi mnth the very simple question of what is a book royalty.



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A book royalty is the money that the author gets from the publisher. It is the compensation the author gets for writing the book and allowing the publisher to publish it. This money is calculated based on the number of sales of that book. This money is calculated in terms of percentage and is a percentage of the net revenue the book generates on each sale. While it is impossible to predict the total profits of a book but the percentage can be negotiated before the book goes into publishing.

The better the percentage the more money the author can make. This percentage calculation is based on a lot of factors and sometimes these factors can be predetermined. The percentage you are going to get can depend on factors such as the type of book as well as the format of the book. Royalty percentage can even change depending upon sales milestones. This is when the royalty percentage is increased when the book makes a certain number of sales. Royalty percentage can also be different for the same book for national and international markets.

One of the misconceptions is that royalty payments are made every time a book is sold but that is not the case because royalty payments are made annually or perhaps monthly or even weekly in rare cases. There are several other factors regarding royalties and we are going to talk about them moving forward.



book royalty rate

In order to understand how royalties work, you need to understand the royalty rate. This is the rate or percentage of the book’s net revenue. The author receives this revenue as compensation for their work. This rate can be negotiated by the author and the better the percentage the more money the author can make. This rate is usually calculated before the book goes into publishing and this rate is not a verbal contract but it is a signed publishing contract.



When we talk about a net revenue calculation it is actually very simple to do. Net revenue is calculated after subtracting a lot of things. Certain things such as expenses and manufacturing costs are subtracted from the gross revenue to find the net revenue. Other things such as discounts and allowances for unsold books are also subtracted. When the net revenue is calculated, the author gets their royalty based on the percentage of the net revenue.


Sales reporting is an important part of royalty calculation because sales revenue will help the author understand an estimate for their royalties. That is why established publishers like ours at Orange Publishers always provide sales reports and statistics to our esteemed authors. This includes detailed sales analysis of the books sold in all types of formats along with details about sales channels. Sales reports go out annually or monthly or anything in between.

After all the calculations are done, the royalty calculation can take place with the help of sales data.  After which the royalty payments are made to the authors along with royalty statements that have a simple breakdown of the payments.


Why Isn't My Book Selling?





While it is true that established authors can get better royalty percentages but when it comes to hardcover edition books the royalty percentage is between 10% to 15%. This rate can vary depending upon the region of the world as well as the author’s negotiation powers and much more.



Paperback editions usually have lower rates of royalty compared to hardcover editions.  Paperback edition books have royalty rates that range between 6% to 10%. These rates are also influenced by the reputation of the author as well as their power of negotiation.



Since eBooks do not have a large manufacturing cost this means that the revenue is always greater when it comes to eBooks. eBooks can be recreated in the millions without spending a single rupee which is why the net revenue is also greater. This is because there is not much to subtract from total revenue. That is why we can expect anywhere between 25% to 40% when it comes to eBooks. One of the best royalty rates in the industry.



When it comes to self-published books, the royalty calculation is a little bit different. This is because royalty rates are not calculated the same in traditional publishing. When it comes to self-publishing, the author is the publisher and invests in the publishing process. That is why the author can expect very high rates of royalty because they are also an investor in the book.  While rates change depending on several factors but we can estimate anywhere between 60% to 80% of the retail price.



Hybrid publishing is a very new concept and it is the combination of both traditional publishing and self-publishing. This is when the other can invest in the book but does not have as much control as with self-publishing. This is a very good option for authors because they do not have to invest a lot into the book and they can expect very good royalty rates that are better than traditional publishing. When we talk about hybrid published books, the royalty rate can fluctuate between 10% to 20% when it comes to printed editions. eBooks will have better rates as usual.



Royalties can last as long as there is a copyright protection for the book. If a book is published under the name of an author, then that author has exclusive rights to the book’s royalties. If there is no pre-determined term of contract then the author is liable to royalty payments till they have copyright over the work. However, that is only possible when the author has the rights to their book and has given the publisher special right to exclusively publish the book.  Most of the time the copyright of a book is active even after the author’s death.


One of the ways to determine how long royalties can last is to simply find out if there are any contractual terms. If the author and the publisher have agreed to royalties for a certain period of time then the author is going to get royalties only for that. The royalty payments will stop after those fixed number of years as specified in the contractual term. The contract can even say that the author will receive a royalty for the entire duration of their copyright holding.


There is usually an out-of-print clause when publishing contracts are signed and this out-of-print clause is simple to understand. It is when the book is no longer in print because of little or no sales or because of the unavailability of the book from the market. The book is simply out of print. When that happens, the book’s author gets back all the exclusive publishing rights and that is also why they stop getting royalty payments from the initial publisher.


The present royalty rates and royalty payments can stop because it is put on hold until new negotiations for new royalty rates are done. This is usually done after a certain period and it is usually done after certain sales milestones are reached. That is when we can expect the current royalties to end so that the new royalty rate can be initialized.



The money earned from royalty is considered income and that is why you must have to pay income tax in India. The money that you earn from taxes is categorized as “Income from Other Sources”. This is in accordance with Indian Income Tax Act.


While authors will have to pay tax on their income generated from royalty but here is some good news. They can even claim some tax deductions if they are self-publishing their book. That will mean that they are also investing in production and promotion as well as marketing. This will open the doors for claiming tax deductions. The best thing to do about this is to consult your accountant regarding taxation.


You will be under Indian tax laws if your book is only sold in India and if the publisher is Indian.  However, if you receive your royalties from any foreign publisher then things can become complicated. That is when you will be taxed under the tax treaty. Tax treaties are treaties and agreements signed and agreed upon by two nations and this treaty will be applicable to your nation and the foreign country of publishing.


An advance is a pretty simple concept in the world of publishing and it is to do with supporting the author in their writing career. This is because it can take a lot of time for the book to get finalized and for it to start publishing. Then again it can take a lot of time between publishing and receiving royalties.  That is why an advance payment can be made to the author after estimating and calculating their royalty in order to support them.

However, it is important to understand that this is a rare occurrence because advances, in reality, are only given to popular authors. Publishers can only predict good performance from authors who have performed well in the past. An advance is not a bonus and it is nothing but an advance payment of royalty. If an author is paid an advance, then the subsequent royalties are paid to them after deducting the advance.

While it is common for the publisher to pay the author in advance before sales begin but there can be exceptions. Sometimes advances are paid after the publisher monitors the sales and the growth of the sales which will help them predict future performance thereby making advance calculation easier.



Let us look at a very simple example. Let’s say an author has signed a contract with a traditional publisher and the publisher has advanced ₹ 1,00,000.

Now let us assume that the agreed-upon royalty percentage between the author and the publisher is 10%. And the net revenue of the book is ₹ 10,00,000.

That is why in order to calculate the royalty of the author with simply need to multiply the net revenue by the percentage of royalty. The answer we get is ₹ 1,00,000.

Now let us remember the amount that had been paid upfront as an advance during book signing as the royalty which was ₹ 1,00,000. And the amount that needs to be paid on royalty is ₹ 1,00,000. That makes the advance balance zero because the royalty that the author deserves has already been paid in advance. Which means the publisher does not need to pay any additional royalty on that book.

However, if the book makes any more sales in the next quarter or the next year then since the advance balance is zero which means that the publisher has to pay royalties at 10% again.

The simple meaning behind all these calculations is that the publisher does not need to pay any royalty as long as the royalty is below the prepaid amount of advance. It has already been paid by the publisher. When the book starts earning more money than the advance paid royalty, then the publisher has to pay the additional royalty.


Before we talk about what is going to happen with the royalty agreement if the book sells for more than the list price, let us talk about the list price. The list price is the MSRP of your book. It is the printed price and some royalty agreements are calculated on the list price rather than the actual sales price.

If that is the case with you that you have agreed to get royalties on the list price but the book is actually selling for more then there are certain things you can do. You will definitely have a clause in the contract where there will be mention of such cases. When things like this usually happen, the author and the publisher usually sits down and agrees on a new royalty percentage.

If you do not want to get into all these calculations then you can agree with the publisher to get royalty payments that are based on the actual price.


There are several factors that can affect the amount of book royalties that you can receive as an author.  It can even be the case that these factors will work in combination and that can fluctuate the amount of book royalties. Let us look at these factors.


This can have a profound impact on the royalty rate because there are different preset percentages of royalty in the publishing industry. These rates are different for hardcovers, paperbacks or ebooks or other types of books.


The better the book performs the more royalties you are going to get and that is why sales volume is a very big factor in royalties. This is simple to understand because the more books you sell the more royalties you are going to get.


If you have already been paid an advance by the publishing company then that can affect your royalty payments later on. This is because the amount of the advance will be deducted from all the royalties you have earned and only after the advance amount has been covered will you get new royalties.


Location is a big factor when it comes to royalty calculation. This is because prices are different for different countries the book is sold. Along with that, we come to market differences because a good market will have better royalty rates and a very stagnant market will not have good royalty rates.



While we can of course talk about royalty rates in India but then again it will not be very worthwhile for you. This is because the royalty rates that we have mentioned above are very similar to the royalty rates in India. Even after there is similarity, we can find huge differences when it comes to publishers and markets. Different markets prefer different kinds of books and different countries prefer different kinds of books. This means a particular kind of book might be popular now and might not even be on the bookshelf next year. That is why a very customized royalty calculation is agreed upon between the authors and the publishers. It is impossible to guess that.


Authors do not pay royalties. The entire concept of royalty payment is there so that authors can get paid by publishers to publish their work. However, authors might need to pay additional people such as editors and cover designers and marketing services but those are not considered royalties. In order to understand that you simply have to understand the definition of a royalty which is compensation by the publisher to the author.


It does not matter if you are a first-time author because if you are writing under your own name then you are eligible for royalties. If you are publishing under a traditional publisher with a publishing contract to share profits then that is your royalty.


Amazon usually pays a royalty after 60 days of the end of the calendar month when the realities start on a particular book. The reason why there is a delay for this is simply because of adjustments and returns as well as verification of sales and all the calculations. There can be other parts of the agreement such as a minimum balance that needs to be accumulated so that authors can start getting payments. It is different for each country Amazon operates in.

It is very easy to understand the royalty calculation at Amazon because the sales reporting at Amazon is very good and will allow you to track everything about the book sales.


You can expect royalty payments till the time your copyright is standing which is usually a few decades after your death. When you are signing the book contract you can also sign your succession contract.  This will help you set a nomination and that person will receive your royalty payment after your death.  This is just like something that happens at a bank and this is very organized. The right to book royalty is passed down from the author to their successors in the event that they did not make a succession contract.

We hope this blog has been helpful for you to understand what are book royalties and how they work.  This might seem complicated because they can be complicated with other publishers. But you do not need to worry about royalty payments with us at Orange Publishers. We are the fastest-growing and most popular publishing company in India with the best royalty payment structure that is organized and simple to understand. Our authors are our priority and we are very flexible when it comes to royalty agreements so that our authors are satisfied at all times.

We are one of the few publishing companies that are fully equipped to do everything in-house. Everything from the planning to the illustrations and the printing as well as the publishing is done in-house at Orange Publishers. We even take care of copyright issues so that our authors can only concentrate on what they do best which is writing. We welcome you to check out our amazing services and we welcome you here to the Orange Publishers family where everything is possible.

Writer vs. Author

A writer is a person who is engaged in the process of writing. If the person spends his days writing books, novellas, or short stories and writing has become a part and parcel of his daily routine. A writer need not have to write their own original ideas- a journalist, ghostwriter, blogger, or screenwriter can also be a writer where  subject matter and central idea of the writing comes come from someone else and irrespective of whether the idea or work shall get published.


Parameters Author Writer
Meaning An author is a person who is the originator of a written work like an article, a book. A writer is a person who writes a piece of literature, articles, blogs, novels, or short stories not necessarily on his ideas.
Required Skills A person becomes an author once their work gets published. There are no additional skills required to be another apart from having basic writing skills. A writer requires certain domain-specific skills or degrees.
Nature of Work An author develops plots and ideas and narrates them in the form of stories or plays. The writings of an author are lengthier in nature. A writer writes on specific topics that are brief and precise.
Publishing and Copyright An author’s books are always published with their name and the Which has the copyright of the author. The works of a writer are not necessarily published under their name.



Writer or Author: What’s the difference?

An author’ is the person one who originally creates his own content, whereas a ‘writer’ is the one who writes any sort of content concerned to the topic that has been assigned. An author develops and brings content into existence. The word author normally refers to all those people who write books, stories, articles, etc. professionally. On the other hand, a writer structures the ideas properly and presents them in the form of writing. They are known for their techniques of presentation and explanation and normally they write in magazines, articles, informative content, etc. Writers are not bound by the category and type of the content and their articles are from the future point of view.

Writer versus author: Which one are you?

Writer versus author

A writer is a universal set, and an author is a subset to that. All authors are writers, but all writers are not authors. Anyone who writes is a writer- hence someone who is writing a journal is also a writer. But an author is essentially the person who originates the idea, plot, or content of the work being written and writes the book. To be an author, the idea of the writing must be of his own and he must get his work published. An author must have a specific skill set but writer’s skill is suited to the job required.  One may become an author when your books are published, but if his writings are never published, he remains a writer. An author normally get is work copyrighted.

What Is an Author


The author is a certain functional principle by which, in our culture, one limits, excludes, and chooses. The author is therefore the ideological by which one marks the way we fear the proliferation of meaning.

What Is a Writer


A writer is a person who communicates his ideas through his written words. Writers keep producing various genre of literary art and creative writing like novels, short stories, poetry, plays, news articles, screenplays, or essays. Writers who are skilled uses his language to express ideas and their work contributes significantly to the cultural content of a society. Writers can produce material across a few genres, fictional or non-fictional. Other writers use multiple media – for example, graphics or illustration – to enhance the communication of their ideas. Some use images or multimedia to augment their writing. In some cases, a creative writer can communicate their ideas via music as well as words.  Writers can be professional or amateur, that is, for payment or without payment and may be paid either in advance, or only after their work is published. Payment is the main motivation of some writers while many are never paid for their work.

Learn More About Writing


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Writing is one of the most important skills a person can develop. It helps in communicating with other people and express the thoughts clearly. Many perceive writing is easy, but, it is extremely challenging at times- particularly when one is coming up with ideas for different types of writing projects. Writing skills are the skills you use to write effectively and succinctly. A good writer is someone who can communicate their point to their audience without using too much fluff and in a way that the other person can understand. Writing skills don’t just include the physical act of writing. Skills like research, planning and outlining, editing, revising, spelling and grammar, and organization are critical components of the writing process. Few areas which aways should be taken into consideration to improve the writing skills. First and foremost is grammar and spelling as they form the foundation of good writing- Even if a text is grammatically correct, one may be able to make it more dynamic and interesting with some polish by choosing strong verbs or shredding unnecessary words.  There is no substation of good reading- read as much as possible as the knowledge acquired from reading add value to the quality of the writing. If one is trying to write a humorous short story, read humorous short stories. If you are planning to write a book review, make sure to find a few and take note of how they’re structured. No matter how much one is tempted to submit the work after completion, it is important to remember the work is not complete unless a thorough check is done by revisiting what one has written to catch errors big and small. Feedback improves the quality and add value to the content- hence asking for feedback is a great way to see how a somebody besides the writer interprets the text. Structure ensures the big ideas get across to the reader and in many cases, forming an outline will help solidify structure.

Traditional publishing

Book Publishing Service

Traditional publishing is the system where the book is published by an established publishing house and there shall be a team of professional people to take care of the book design, sales, marketing, and various other processes related to publishing of books. This is a more formal approach for the author’s effort to reach out to masses. The traditional publishers have more opportunities to get the physical copies of the books all over the nation with the help of their sales force who reach the bookstores making the job of the buyer easy with their recommendations on selecting the books they’d like to carry. Their recommendations are guided by the market trend and the marketing incentives their publisher is planning. Even booksellers trust these salespeople as they know the pulse of the market and are backed by a publishing house. The book-buyers visiting the bookstores are more likely choose the books recommended by this salesforce instead of buying books from a new author who has self-published his book.  Traditional publishing houses employ a team of experienced editors, art directors, proof-readers and the salespeople who deliver quality. Traditional publishing doesn’t come with upfront financial costs. Chances of winning a literary prize are more likely in the case of traditionally publishing. Furthermore, traditional publishing offers a sense of validation and prestige to the author. Traditional publishing is time consuming, and, on an average, it takes a year for a traditionally published book to come to market. Royalty rates for traditional publishing ranges anywhere between 5% and 20%, with the latter being on the extremely generous end. On an average, traditionally published writers get around 10% of the net sales price of a book- which means that all the discounts, returns, marketing costs, and overheads are taken out of the total before the profit percentage is calculated.

How to Avoid Publishing Scams

As an author, I would always like for my book to reach maximum people. And I am sure that is the dream of any aspiring author, and to ensure that, the job of an author doesn’t end with writing only. It reaches the target readers only when the author successfully avoids publishing scams and reaches the right publisher. Publishing scams are rampant in the publishing world and there is a constant fear by many aspiring authors of stepping into the traps of some notorious self-publishing company and all the hard-work of the author goes down the drain in the process.

Worst self-publishing companies

Worst self-publishing companies are not few in number. They wait with the fangs and claws out, ready to attack any author caught unaware- particularly those who are not aware of how they work. They take advantage of the lack of knowledge and inexperience of the author and disguised as traditional publishing house, cheat the author for money- at times disappear with the manuscript.

Book Publishers to Avoid

Book Publishers to Avoid

It is extremely important for an author to know from beforehand which publishing company to avoid and whom to trust. Here are few traits of the self-publishing companies which are signals of publishing scams and an author should avoid:

Publishers who load authors with unnecessary costs and fees like

Reading fees- no proper publishing company charge for reading manuscript. It is their job and they eagerly look forward for good manuscripts.

Purchase compulsions- no proper publisher forces the author to purchase his own book.

Publisher fee for a traditional publisher- A traditional publisher never claims service charge fees. It is Self-publishing companies that take a service charge.

Contest fees- only the notorious publishing companies force the author to participate in paid contests and charge fees

Publishers with conniving advertisings and claims

No good publishing house can guarantee the author for his work to become a bestseller or assure the sale of a guaranteed number.

Another indicator of publishing scam is grossly over-priced self-publishing services and low quality editing and designing.

Author Scams

Author Scams

One of the most dubious set of publishers who can ruin all the hard-work of an author is Vanity Publishing. They are a set of publishing house where the authors publish their work with hardly getting anything in return. As the name suggests, the authors publish purely out of vanity, knowing well their endeavour shall not be a commercially viable one. Taking the advantage of the situation, these publishing houses charge exorbitant fees. Vanity publishers are sly set of people who flatter the author, take money from the author and deliver poor quality of books. Their motive is to make money from the contribution fee of the author- hence are reluctant about promotion, marketing or selling of the books. Vanity publishers have least connections with bookstores and all the books they publish end with sad fate.

Publishers with Unethical Contracts

Unethical Contracts

It is very important for the author to read the terms and conditions very cautiously. Contracts are drafted by the publishing houses and they design the contract for their own financial interest. Worst self-publishing houses add clauses like minimum sales guarantee, or get the rights of the book to themselves and manipulate with the exit clause. Ethical contracts generally allow the author to retain their rights- but these areas are played upon tactfully by the worst self-publishing houses. They are manipulative on the percentage of the royalty to the author as well and try to pay the author as less as possible. Sales residuals are of extreme important and most authors ignore this, being oblivious to the benefit of residual income. The author should ask for it as that can be a major source of income for the author in later days.

Thumbs Down Publisher List

There is a huge list of book publishers who are to be avoided by any author. One of the most prominent vanity publisher is Author Solution. They trade under a long list of names- few of them are  AuthorHouse, AuthorHouse UK, AuthorHive, iUniverse, Palibrio, Partridge Publishing, Trafford Publishing and Xlibris. Some other book publishers to avoid are Abbott Press, Alliant Press, AlphaScript, America Star Books, Archway Publishing, Balboa Press, Barbara Bauer Literary Agency, The Writing Crew, The Clock Writing, Olympia Publishers, Indie Writer Support, etc. There are a huge range of names in this category and almost all these companies have issues regarding quality, service, communication, marketing and contracts.

Signs of a Publishing Scam

With alarming rise in rate of publishing scams, it is advisable that an author keeps a strong vigil on the few signs that are considered as indicators. Getting indication of any one of the alerts mentioned below is a signal to the alert to get alert, keep a watch on the publisher and do a thorough check on the credentials.

  • When a publisher try to impress the new aspiring author with flowery statement
  • When the representatives of the publisher cannot explain the business model or is not confident while explaining the payment structure.
  • Incorporate marketing deals in the package which the author can manage by himself and doesn’t actually need any support of the publisher.
  • Publisher charging for reading the manuscript. No ethical publisher- traditional or self-published, charges for reading the manuscript.
  • No phone number or address is mentioned and the email address is also ambiguous.
  • Names of real people of the company, updated website, presence on social media is missing.
  • The publisher insists on the author buying bulk copies of his own books.
  • Publisher assuring high sale.
  • Communication without any real-life contact. All communication restricted to mails only.
  • Ambiguity between verbal discussions and contract.

Book Publishing

Writer Beware’s List

An author may find website of Writer Beware extremely useful for combating publishing scams. Writer Beware is a blogsite which has been made primarily to safeguard the authors from publishing scams. This acts as a watchdog in most cases and updates the authors of the latest publishing scam. Furthermore, they try to throw light on impersonation of any form through which an author may get cheated.