Side Hustle Spotlight: Digital Project Seller on Etsy

Blog | October 18th, 2022

Selling digital goods on Etsy is one of the easiest ways to make passive income once you set it up. Digital sellers can make substantial supplemental income simply by uploading files and setting up an Etsy storefront.

What Does a Digital Project Seller Do?

Digital project sellers on Etsy sell printable or downloadable files for others to use. Selling digital files is a great way to make income on Etsy without packing and shipping items to individual customers because files land straight in their inboxes.

Digital sellers can sell all kinds of projects. Things like sewing patterns, coloring pages, printable art, PDF pages, resume templates, and more. Anything you can think of that you might buy and download, you can sell on Etsy.

How Do I Get Started?

You can get started by creating a digital file that other people will want to download. Some people have used Canva to make downloadable wedding invitations, while others have used their skills and knowledge to make knitting patterns.

The kinds of files you choose to put in your store are up to you. Once you have collected some files you think people want to buy, you can simply follow Etsy’s setup process to get your store up and running.

Taxes and Etsy’s Cut of the Money

You should keep a few things in mind when running an Etsy store. The first is that Etsy requires a $0.20 listing fee per item. This means an initial cut of $0.20 per digital item sold. Etsy takes an additional 6.5% of the total order amount per sale. 

Make sure to set money aside for taxes if you make more than $600. Most experts recommend setting aside roughly 20% of your income to give to the IRS at the end of the year.

Is Training or Certification Required?

Etsy does not require any kind of training or education to get started. You do not need a business license to sell on Etsy unless you plan on running your store as a business (i.e., filing business taxes, hiring people, etc.). 

Note that in the United States, a hobby shop becomes a business if you profit in three of five consecutive years

Expected Returns

People who sell digital items on Etsy can make hundreds to thousands of dollars per month, depending on the amount of content they make and the popularity of their products. Some sellers have reported making tens of thousands of dollars per year.

Can You Set Your Own Hours?

Yes, there is no requirement for the amount of time you put into your Etsy store. Better yet, you can set up your store using only your computer whenever you want.

The Bottom Line

Selling digital projects on Etsy is a simple way to make extra money. Once you set up your page, your store will require very little attention from you to keep running, which makes this side hustle closer to passive income.