For many game developers, the first sale is a dream come true. Whether it’s a few downloads or a sudden spike in purchases, that initial income is a big milestone and it’s exciting. But it also raises questions: What should you do with the money? Do you need to report it? How do you make sure this success leads to more?
Here’s how to handle your first game income the smart way so you can stay organized, tax-ready, and focused on building a long-term career.
Treat It Like a Business (Because It Is)
Even if you’re a solo developer or this is just a side project, once you start earning income from your game, you’re technically running a business. That means it’s time to shift from hobby mode to business mindset.
Why it matters:
Income from game sales (whether on Steam, itch.io, or mobile stores) is considered taxable. Treating your dev work like a business early helps you avoid messy financial surprises later.
Separate Your Business and Personal Finances
One of the most common mistakes first-time developers make is keeping all their money in one personal account. This makes it harder to track what you earned, what you spent on development, and what you owe in taxes.
Best practice:
Open a separate bank account just for your game income and expenses. Even if you’re not registered as a business yet, this simple step keeps your finances cleaner and easier to manage.
Track Everything from Day One
You don’t need complex accounting software right away but you do need to start tracking your numbers. Every dollar earned and every dollar spent should be logged.
What to track:
- Game sales and platform payouts (and associated fees)
- Software licenses, assets, and tools
- Contractor payments (art, music, etc.)
- Marketing and promotion costs
- Revenue from secondary sources (Patreon, merch, etc.)
Spreadsheets work fine at first, or you can use tools like QuickBooks Online to automate the process as you grow.
Save a Portion for Taxes
It’s easy to overlook taxes when money starts coming in especially if it’s your first time earning as an independent creator. But taxes can hit hard if you’re not prepared.
General rule:
Set aside 25–30% of your net income for taxes. This might feel like a lot, but it helps avoid a major surprise when tax season arrives. If you’re not sure how much to save, speak to a bookkeeping or tax professional early.
Reinvest in Your Project (and Your Growth)
That first income stream doesn’t just pay off your time it opens doors. Consider how you can reinvest some of the money to grow your game, brand, or studio.
Ideas for reinvestment:
- Upgrading your marketing efforts
- Improving the game with additional content or polish
- Hiring freelancers to speed up future development
- Saving for your next project
Smart reinvestment helps turn a one-time success into a sustainable path forward.
Start Strong, Grow Smart
Making your first game sale is exciting and it should be. But it also comes with responsibility. By treating your project like a real business from the start, you’ll build a solid foundation for future success.At gameaccounting.com, we help game developers take control of their finances with clear, customized support from first sale to full launch. If you’re starting to earn income from your game and aren’t sure what to do next, we’re here to help.