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9,243 Views 30 Replies Last post: Nov 30, 2012 5:45 PM by RedPrince RSS
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Level 0 84 posts since
Apr 10, 2011
Currently Being Moderated

May 26, 2012 6:11 AM

Amazon Taxing Non US Residents?????

From what I've heard here in Canada. You can only charge people who reside in the country that you live tax.

 

Anyone outside of your country is not obligated to pay tax. meaning they should not be taxed as they are not a resident

 

Yet I read on kindle this  https://kdp.amazon.com/self-publishing/help?topicId=A30F3VI2TH1FR8#1-10_intl_tax

 

1-10. Is tax withheld for publishers outside the US?

 

For sales made on Amazon.com, royalties paid to a foreign entity or person are subject to tax withholding in the U.S. A foreign entity or person is someone who is not a resident or citizen of the U.S. or a green card holder. The general rate of tax withholding is set by U.S. tax rules and regulations and is currently 30 percent of royalties paid. This withholding tax rate can be reduced if the recipient (you) is a resident in a jurisdiction that has a valid income tax treaty with the U.S. This reduced rate is only available if we receive the appropriate documentation from you. Without this documentation, the 30 percent withholding tax rate will apply.

 

 

That has got to be a joke???

 

So if I earn $1000 from my books they will not ony keep 35% of the royalty but then they will take another 30% for tax??? That is 65%. Leaving me with 35% of a $1000

 

Am I reading this right as if i am I cant see how it would benefit ANYONE to put books on Amazon as they are taking ABOVE 50% of your income

Level 5 3,191 posts since
Mar 10, 2012
Currently Being Moderated
2. May 26, 2012 7:09 AM in response to: kalel
Re: Amazon Taxing Non US Residents?????

Your original premise of not paying tax in a foreign country does hold true in some cases such as sales tax where you can fill out forms to claim this back but income is a different matter. Because CS pays royalties ond not revenue then the income is considered to be earned in the US (revenue would be earned in your country of origin) so if you earn money in the US you need to file us income tax, CS withholds funds in order to ensure this is covered.

 

As a Canadian you have a tax treaty in place that allows you to get past this and not have to pay income tax in the US on these royalties. To do so you need to obtain a US ITIN number or EIN number ( I suggest EIN as it only takes a15-20 minute call to the IRS) once you have your number you submit a W7BEN form and they will no longer hold back anything for taxes.

 

Hope this helps

 

R. C.

Level 4 4,445 posts since
Feb 1, 2008
Currently Being Moderated
4. May 26, 2012 9:54 AM in response to: R.C.
Re: Amazon Taxing Non US Residents?????

Let's hope a feasible and economical POD company opens up in Canada soon. We need it!

Level 5 3,191 posts since
Mar 10, 2012
Currently Being Moderated
5. May 26, 2012 10:03 AM in response to: kalel
Re: Amazon Taxing Non US Residents?????

You are correct the believe the form is a W8-BEN. As a foreign national you can not apply for an EIN online and will have to call. Having an ITIN was not required. And no you do not have to be published to set this up it can all be done in advance.

 

R. C.

Level 5 3,191 posts since
Mar 10, 2012
Currently Being Moderated
6. May 26, 2012 11:05 AM in response to: Ninian
Re: Amazon Taxing Non US Residents?????

I just hope to sell enought to make the hassle worthwhile in the end

 

R. C.

Level 0 20 posts since
May 27, 2012
Currently Being Moderated
8. May 27, 2012 6:37 AM in response to: R.C.
Re: Amazon Taxing Non US Residents?????

I live in the UK and I know the US tax withholding is 0% with the UK if you have the US tax certificate but I'm not sure how to go about it, so if you can help me I'd be very thankful

Level 5 3,191 posts since
Mar 10, 2012
Currently Being Moderated
9. May 27, 2012 8:15 AM in response to: pennywhistle
Re: Amazon Taxing Non US Residents?????

Your first step is to obtain a US ITIN (Individual Tax Identification Number) or EIN (Employer Identification Number). The process for obtaining an EIN is much easier and you can obtain one as a sole proprietor so this is what I usually suggest. All it requires is a phone call to the IRS and some basic information about yourself and your business (self-publishing).

 

Once you have obtained your IN number there is a W8-BEN government form that you need to fill out and submit to CS for them to stop withholding the tax amount.

 

 

R. C.

 

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Level 0 6 posts since
Aug 6, 2011
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10. Jul 6, 2012 10:29 PM in response to: R.C.
Re: Amazon Taxing Non US Residents?????

Hi

 

Ive published a few books on Createspace now and a trying to get a letter from them to accompany the w-7 form to stop tax withholding, im UK based.

 

But when I asked customer services for it they didnt seem to know what I was talking about and sent me a copy of the w-7 form which I already had.

 

Is the 'letter' called anything in particular or have a code number I can ask for.

 

Thanks

 

Chris

 

------------------------------------------------------------------------
Chris Breen, Clinical Tutor, Paramedic, RGN

Author of; 'Wilderness and Survival Medicine', 'Clinical Assessment and

Diagnostic Skills' and 'CBRNe, Terrorism, Medical and Major Incident

Management'
www.survival-medic.com
www.facebook.com/survivalmedic
www.lulu.com/spotlight/survivalmedic

EDitions available from Lulu, Amazon and on Kindle
 

Level 5 2,821 posts since
May 5, 2009
Currently Being Moderated
11. Jul 7, 2012 12:55 AM in response to: Survival_Medic
Re: Amazon Taxing Non US Residents?????

The whole tax this is annoying. Over two years ago I got a letter from CS - very easy. A year ago another member asked for one and his was rejected by the IRS as it was not an original er.. neither was mine it was emailed to me. I can email you mine and you can have a look at it, then you can email/call CS and tell them exactly what it should state. I feel that often CS lacks in certain staff training/awareness, which is a shame as their products are generally good.  You can contact me by my website. http://www.alexwshaw.com

Level 5 3,191 posts since
Mar 10, 2012
Currently Being Moderated
13. Jul 8, 2012 3:29 PM in response to: kalel
Re: Amazon Taxing Non US Residents?????

You must have hit the IRS on a slow day, my phone call took about 15 minutes . Other than that you are right, much easier than getting an ITIN.

 

R. C.

Level 0 6 posts since
Aug 6, 2011
Currently Being Moderated
14. Jul 9, 2012 11:26 AM in response to: Hetman
Re: Amazon Taxing Non US Residents?????

Hi

 

Thanks for the reply, i`ve managed to get a copy of the letter now.

I`m now trying to get a cheque off them they should have sent me 8 weeks ago, before everything went to direct deposit.

after which i intend to put the royalties on hold until until I can sort out the tax.

 

I`ve been reading the forums and was wondering if the only way in the Uk of geeting a certified copy of your passport was to

go to the US Embassy, its quite a trek for me I live in Lincolnshire.

 

Chris

 


------------------------------------------------------------------------
Chris Breen, Clinical Tutor, Paramedic, RGN

Author of; 'Wilderness and Survival Medicine', 'Clinical Assessment and

Diagnostic Skills' and 'CBRNe, Terrorism, Medical and Major Incident

Management'
www.survival-medic.com
www.facebook.com/survivalmedic
www.lulu.com/spotlight/survivalmedic

Editions available from Lulu, Amazon and on Kindle

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