@gbalex
I think that what creates the difference with the US and US companies has its roots in the way in which US citizens have a liability to be taxed on their international earnings whether or not they even live or are even domiciled in the US. Very few nations do that. From that follows a whole different approach to collecting taxes.
Govts apart from the US are not collecting taxes on photo royalties.
**** sorry - to add: apart from the taxes which the agencies actually pay. Which is a different matter.
That is not a mistake.
Sure it might change. I'm not arguing with you.
Spend a bit of time on Alamy's site... they are a UK company.
http://www.alamy.com/example-tax-payments.asp
"If you are not located in the following territories you need to review the Table of Treaty Rates which sets out the DTT (Double Tax Treaty) relief you may be eligible for. The table below assumes that you are eligible for the DTT relief.
Table of example payments for individual contributors"
http://en.wikipedia.org/wiki/Alamy
OK - In general i definitely would bow to your superior knowledge. But I want to ask this .
Are you absolutely certain that the page you have linked to is not actually about a VAT change rather than being about a tax on royalties? Is that page actually about something which is like the US withholding tax? I am not sure that it is.
That pages seems to relate to VAT. The table columns seem to be about VAT. VAT is what people in the US call 'sales tax'. Same as applies in most US states.
And that would make sense in the context of it being about a switch from Alamy Jersey to Alamy UK. Since Jersey is crown dependency but not part of the UK, makes its own regulation and does not levy VAT ( - or did not. IIRC I read that they are / might be introducing it). So moving from a relationship with Alamy Jersey to one with Alamy UK would involve dealing with UK VAT.
I could be completely wrong.
It outlines both Vat and the rates for withholding's taxes charged to to foreigners outside of the UK as outlined in the UK's tax treaty's
http://www.alamy.com/stock-photography-faqs-tax-non-uk.asp# What is Withholding Tax (WHT)?
Withholding Tax (WHT) is a government's imposition of a tax on distributions being made to foreigners. The purpose of the tax is to allow the government to make sure it exacts its share of a taxable event before the wealth leaves its shores and moves beyond its control. Thus, in Alamy's case it is the tax Alamy has to deduct and account for to the UK government when it is making royalty payments for the use of images to providers of those images who are not tax resident in the UK. It will only apply to Contributors who are NOT tax resident in the United Kingdom and who are paid outside of the UK mainland.# What do you mean by tax resident?
You will normally be tax resident in the country in which you pay your tax bills and where you submit your tax return. However, tax residence is a complex subject which is determined by local legislation and case law in each country. We therefore recommend that you obtain confirmation from your local tax authority if you are uncertain as to your tax residence status.
# What do you mean by UK mainland?
The United Kingdom mainland comprises England, Wales, Scotland and Northern Ireland but excludes the Channel Islands and the Isle of Man.
# How will this affect the payments made to me?
During registration you will be required to supply your tax details including an assurance regarding the country where you are registered for tax. Alamy will deduct withholding tax from your payment in line with the double tax treaty between the country you are tax resident in and the United Kingdom. This rate can vary from between 0% to 22%. For further details, please visit our Table of Treaty Rates.If you do not answer the questions relating to Withholding Tax within My Alamy, then Alamy will deduct 22% of the net amount due to you in each payment run.# What is the standard rate of WHT?
The standard rate of the tax in the UK is 22%.
This is applicable for all payments relating to photographic royalties to all countries.# Can I reduce the rate of WHT that I pay?
Yes. If there is a double tax treaty between the country you are resident in and the UK and you can assure Alamy that you are tax resident in that country then we can apply the treaty rate on all payments to you. The treaty rate in many cases, e.g. for the US and Canada reduces the rate of WHT from 22% to 0%.# How I can inform you that I qualify for a reduced rate of WHT?
If you are already a registered Contributor then you need to provide details via the payment and tax details page. If you are a new contributor you need to answer the questions during the registration process.
# How will you deduct WHT from payments to me?
Alamy will deduct WHT at the applicable rate of tax from the net amount to be paid out to you after deduction of payment fees and any foreign exchange fees.
# How will I see WHT on my statement?
It will be a line item on your statement when a payment is made to you. It will appear after the payment and FX fees, but before the cheque sent/funds transfer line.
#
What does Alamy do with the money deducted for WHT?
Alamy will pay over the money deducted to the proper government department responsible for the collection of this tax in the UK. The money deducted is not our income and we do not benefit from deducting it.
# What do you mean by "Will you be making royalty payments to other photographers from the money you receive from Alamy"?
Do the images submitted by yourself as a Contributor include images that are not your own, i.e. you are representing these images on behalf of other photographers. If this is the case do you have to pay the respective photographers for their work dependent on your receipts from Alamy? For example, if you paid a one off price to another photographer to either own the rights to the image, or you have acquired the right to exploit the image, then you would answer no, but if you pay a percentage of any sales from that image to a photographer you would answer yes.
# I do not make royalty payments to other photographers but I do not understand the following statement:
"Please confirm whether you are beneficially entitled to income you will receive from Alamy and that you meet the necessary conditions for the payment to be received gross under the relevant treaty between the country in which you are tax resident, and the United Kingdom"?
The statement asks whether you are beneficially entitled to the income, i.e. you should be beneficially entitled to the income as long as you legally own the rights to the images or you have acquired the right to exploit the image and underlying copyright from the legal owner. You will normally meet the necessary conditions for the payment to be received at the relevant treaty rate as long as you are tax resident in the country in which you have said you are resident. However, if you have any doubt as to your eligibility to benefit from the relevant double tax treaty then you should review the said tax treaty to ensure that you are not excluded by virtue of any specific terms of the treaty agreement.
# I make payments to other photographers but I do not know whether all my photographers are tax resident in the same country as I, what should I do?
You should continue to register or provide your details and finish the process by answering "No, not all 3 statements apply to me". You should then attempt to find out whether your photographers are tax resident in the same country as yourself, and if so, you can then come back and complete the details field again. If you find that not all of the photographers are tax resident in the same country as yourself then you should contact
[email protected] with the breakdown of photographers. We can then contact you, as it is likely that we will need to find out more information from you.
# I make payments to other photographers who are all tax resident in the same country as myself but I do not understand the following statement:
"That they, the beneficial owners of the income, meet the necessary conditions for the payment to be received gross under the relevant treaty between the country in which you are tax resident, and the United Kingdom."?
The statement asks whether the photographers you represent are beneficially entitled to the income, i.e. they should be entitled to the income as long as they legally own the rights to the images or they have acquired the right to exploit the image and underlying copyright from the legal owner. They will normally meet the necessary conditions for the payment to be received at the relevant treaty rate as long as they are tax resident in the country in which you have said they are resident. However, if you have any doubt as to their eligibility to benefit from the relevant double tax treaty then you should review the said tax treaty to ensure that you or them are not excluded by virtue of any specific terms of the treaty agreement.
# What do I do if my circumstances change?
You should update the Alamy website with your new details as soon as possible.
# How will I receive deduction certificates stating how much tax you have deducted?
Alamy will send out certificates every year. The certificates will state for each payment made to you how much tax was deducted in US$, the rate of tax, the date of payment and how much the gross payment was. The information will be in US$, as this is the currency your statement is in.
# What is the DTT rate for the territory I am tax resident in?
For further details, please visit our Table of Treaty Rates.
# Table of implications for WHT
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