How to Make Passive Income on Amazon (KDP, Merch and Associates)

To make passive income on Amazon, most people use one of three free programs: Kindle Direct Publishing (KDP) to earn royalties on books, Merch on Demand to earn royalties on printed products, and Amazon Associates to earn commissions on sales they refer. Amazon handles printing, delivery and payments, but you still have to create something worth buying and help people find it, so the income is semi-passive at best.

This guide explains how each program pays as of 2026, the rules that trip up beginners, and what to avoid.

What are the main ways to make passive income on Amazon?

There are three realistic routes, and each one pays for a different kind of work. Selling physical products through Fulfillment by Amazon (FBA) is left out on purpose: it is an inventory business, not passive income.

All three share one trait: Amazon supplies the store and the logistics, you supply the product or the audience. Without the second part, listings usually sit unseen.

How does Kindle Direct Publishing pay?

KDP pays a royalty on every copy sold, and it costs nothing to publish. For ebooks you choose a 35% or 70% royalty option; for paperbacks the rate is 50% or 60% minus printing costs.

Ebooks. The 35% option pays 35% of the list price (excluding VAT). The 70% option pays 70% of the list price, minus delivery costs, for eligible sales in the 70% territories; KDP puts average delivery costs at $0.06 per unit, varying by file size (KDP eBook Royalties). As of July 7, 2026, the list price band for the 70% option on Amazon.com is $2.99 to $12.99, up from a previous maximum of $9.99 (KDP list price requirements).

Paperbacks. On Amazon.com, paperbacks listed at $9.99 or more earn a 60% royalty and those at $9.98 or less earn 50%, calculated as royalty rate times list price minus printing costs. KDP's own example: a $15 paperback with 333 black-ink pages has $5.00 in printing costs, so the royalty is 0.60 times $15 minus $5.00, or $4.00 per copy (KDP Paperback Royalty).

When you get paid. KDP pays monthly, approximately 60 days after the end of the month in which the sale was reported (90 days for Expanded Distribution), once you meet the payment threshold (KDP). Plan for a gap of two months or more between your first sale and your first payment.

Example (hypothetical): an ebook priced at $4.99 on the 70% option earns roughly $3.43 per sale after a small delivery cost. Selling 20 copies a month would bring about $69 a month. Many books sell far fewer, especially without an author who promotes them.

What are KDP's rules on AI and quality?

KDP requires you to tell it about AI-generated content, meaning text, images or translations created by an AI tool, when you publish or republish a book, even if you edited the output afterwards. AI-assisted content, where you created the work and used AI to edit, refine or brainstorm, does not need disclosure (KDP Content Guidelines).

Disclosure is not a loophole. Books still have to meet KDP's content and quality guidelines, and thin, repetitive or misleading books can be removed. The practical lesson: a smaller number of genuinely useful books tends to hold up better than a pile of rushed ones.

Books that tend to suit beginners:

• Short practical guides on a narrow problem you know well.
• Workbooks and journals built around a specific use, not generic blank pages.
• Fiction in a genre you read, if you're willing to write a series.

If you'd rather sell a digital file than a book, our guide to digital products for passive income compares other platforms and formats.

How does Amazon Merch on Demand work?

Merch on Demand lets you upload designs that Amazon prints on shirts, hoodies and other products when a customer orders. You supply the artwork and choose the products and colors; Amazon creates the product page and handles manufacturing, shipping and customer service (Amazon Developer).

It is free to set up, and there is no inventory. Your royalty is based on the offer price minus applicable tax and Amazon's costs, and it varies by product type. As of 2026, joining starts with a request that Amazon reviews, and new accounts can upload a limited number of designs, with more unlocked as they sell. Check the current terms on the Merch on Demand site before you plan around it.

The honest challenge is competition. Printed-product marketplaces are crowded, trademarked phrases and characters are off-limits, and a single design rarely sells for long. Merch tends to reward people who publish many original designs in niches they understand.

Is Amazon Associates passive income?

Associates can be semi-passive once content is ranking or getting views: an article or video you published months ago can keep earning commissions. It is the most traffic-dependent of the three, because you only earn when your audience clicks and buys.

As of 2026, standard commission rates depend on the product category, from 10% on categories such as Luxury Beauty down to 4.5% on physical books, 3% on toys and home, and 0% on items such as gift cards (Amazon Associates rates). After you apply, you need to refer three qualifying sales within 180 days for Amazon to review your application (Amazon Associates).

Our full guide to Amazon Associates covers the rules on link disclosure, payment thresholds and what gets accounts closed.

What about FBA and done-for-you Amazon stores?

Fulfillment by Amazon is not passive. You buy inventory, set prices, run ads, handle returns and carry the risk of stock that doesn't sell; Amazon only stores and ships it.

"Done-for-you" or "automated" Amazon stores are riskier still. In 2024 the FTC sued FBA Machine, also called Passive Scaling, and later featured the case in its Operation AI Comply sweep, alleging the operation used claims about AI-powered software for online stores to take more than $15.9 million from consumers, with promised earnings that "rarely, if ever" materialized (FTC). Any offer that asks for thousands of dollars to run a store "for you" deserves serious suspicion.

Which Amazon option should you start with, and how long does it take?

Start with the one that matches a skill you already have. Writers and subject experts fit KDP, people who enjoy design fit Merch, and people who already publish content fit Associates.

A realistic sequence for a beginner:

1. Pick one program and read its help pages and content rules in full.
2. Research a narrow niche by looking at what already sells and where reviews point to gaps.
3. Publish a small first batch, such as one book or a handful of designs, and learn the tools.
4. Add one way to reach buyers, such as a simple email list, a social channel or search-friendly articles.
5. Review after several months and decide whether to build more titles, improve listings or switch.

Most people wait months before income is steady, and many earn little. Our guide on how long passive income takes to pay off explains why timelines vary so much. If you want a structured path, use our step-by-step guide to building passive income.

Results depend on your effort, niche and execution, and none of these programs promises sales.

Next steps

• For the full method to make passive income from scratch, start with our step-by-step guide.
• Compare Amazon with other starting points in passive income ideas for beginners.
• Want the bigger picture first? Read our guide to making money online.