Author Topic: IRS Withholding Taxes for non U.S. Submitters (Read 126790 times)

gbalex · « **Reply #300 on:** June 01, 2009, 15:51 »

Quote from: alias on June 01, 2009, 14:20

Quote from: gbalex on June 01, 2009, 14:10
The recent moves makes it much harder for companies who set up shell companies in various countries around the world to evade tax obligations.

For sure. But the main issue is that a company can now set up in any country which is on the OECD white list without some vested interest trying to insinuate that the country involved is somehow dodgy. Because all of the countries on the OECD white list have equal status. So countries can now much more fairly compete to provide good business environments. Which is a very positive result.

Seriously - who wouldn't move the business somewhere less bureaucratic ?

Do you know of any country which does not include Article XII in the most recent version of its tax treaty? The issue at hand is that as internet business revenue expands and global tax bases continue to shrink, most countries are starting to become much more aggressive in enforcing and collecting tax's under their existing treaties.

Royalties

1. Royalties arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.

If you know of a country that does not include royalty considerations in their agreements with the countries who participate with them could you post those tax treaties?

luceluceluce · « **Reply #301 on:** June 01, 2009, 16:34 »

So, I sat down for a long time with my thumb and a pencil. (I didn't really need the pencil because I used the calculator on my laptop)

If every country were to automatically withhold tax on royalties (like the US is doing), unless supplied with a notarised and apostilled copy of a passport and a tax number application form - then the rough figure (worked out on my confabulator) to enter into the microstock market is $11,000.

Were such a thing to occur, i shall personally start shooting porn.
x

sharpshot · « **Reply #302 on:** June 01, 2009, 16:43 »

It looks we will be able to use an EIN number, if it is appropriate. This is the thread that an admin has replied to.
http://submit.shutterstock.com/forum/viewtopic.php?t=62691

The weather here has been too nice to read through all the details but does anyone know if there are any drawbacks doing this? I want to keep it as simple as possible, doing my tax in the UK is all I can cope with, I should get an accountant but I like doing it myself. Don't think I could cope with having to do a US tax return as well though.

Milinz · « **Reply #303 on:** June 01, 2009, 16:51 »

;-)

http://www.cato-at-liberty.org/2009/05/25/obamas-proposed-irs-rules-mean-trouble-for-overseas-americans-will-also-lead-to-less-investment-in-america/

alias · « **Reply #304 on:** June 01, 2009, 16:56 »

Quote from: gbalex on June 01, 2009, 15:51

1. Royalties arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.

Might be worth you quoting article 12 in full. It raises some fascinating issues. You have obviously looked into this much more than me.

It practically deserves its own thread.

snaprender · « **Reply #305 on:** June 01, 2009, 17:03 »

Quote from: sharpshot on June 01, 2009, 16:43

It looks we will be able to use an EIN number, if it is appropriate. This is the thread that an admin has replied to.
http://submit.shutterstock.com/forum/viewtopic.php?t=62691

The weather here has been too nice to read through all the details but does anyone know if there are any drawbacks doing this? I want to keep it as simple as possible, doing my tax in the UK is all I can cope with, I should get an accountant but I like doing it myself. Don't think I could cope with having to do a US tax return as well though.

From what I was reading, if you supply an EIN instead of at ITIN, you will need to do a US tax return every year for the IRS (Due not later than April 15th).

RT · « **Reply #306 on:** June 01, 2009, 17:22 »

Quote from: snaprender on June 01, 2009, 17:03

From what I was reading, if you supply an EIN instead of at ITIN, you will need to do a US tax return every year for the IRS (Due not later than April 15th).

Only if your business is in the US.

If your business is outside of the US you do not have to supply them with any annual tax return because your accounts are nothing to do with the US, that's the whole point of completing a W-8BEN

luceluceluce · « **Reply #307 on:** June 01, 2009, 17:24 »

Congratulations!

* has approved and selected your photo 14424300. The image is now available for sale.

Milinz · « **Reply #308 on:** June 01, 2009, 17:28 »

Quote from: luceluceluce on June 01, 2009, 17:24

Congratulations!

* has approved and selected your photo 14424300. The image is now available for sale.

* = Fotolia ;-)

http://www.fotolia.com/id/14424300

But, Liceluceluce, stay away from fotolia forum - they ban for even less than you said on SS. I am banned 2 years!

luceluceluce · « **Reply #309 on:** June 02, 2009, 00:54 »

Milinz - ur a submersive elephant too?

I really have to stop confusing corporate entities with egalitarian collectives....
: D
x

luceluceluce · « **Reply #310 on:** June 02, 2009, 01:15 »

What is it with microstock? I keep reading about past protests on other agencies too (on different issues).

I think they should take the forums away from us. It can get confusing.. are we a community or just suppliers? Is this just a cold business or do some agencies use submitter loyalty in their branding?

Can we all have our cake, and eat it too?

What do the agencies want? Submitters or suppliers? A community or 'international business'? If we are a community we are likely to react in emotional ways, if we are 'business people' we are likely to act in cold and pragmatic ways.

For so many this industry was about 'passion'. Now we are told it is only about 'business'.

Well, the business response is this: avoid distrubution channels that make it difficult to distribute. Diversify our portfolios - and non-US submitters focus on sites that don't attract IRS issues.

Im sad I've gone all cold and hard and glinty. i enjoyed the idea of being part of a community - all in it together, all helping each other along. Before i used to include the agency in this warm glowy fireside picture.... and that is what has really changed for me (although my glowy feelings about you guys are stronger than ever!)

Now I am ready for international business. I have lost my naivety. Before I had this idea that I was a child, who was being done a favour by an agency... and that this agency protected me and my interests.

Im not a child. They are not a parent. Forums are not free - they are part of a corporate branding strategy.

We are not submitters. We are not contributers. This devalues us as international business people.

We are suppliers.

I'm so relieved that I have that all straightened in my head
x

ps. any agency out there who runs this more in partnership with your photographers? Put me on your list pls. I actually don't want to be cold and hard... I want to work WITH others because this is how i want the world to be....

Maui · « **Reply #311 on:** June 02, 2009, 01:49 »

Quote from: RT on June 01, 2009, 17:22

Quote from: snaprender on June 01, 2009, 17:03
From what I was reading, if you supply an EIN instead of at ITIN, you will need to do a US tax return every year for the IRS (Due not later than April 15th).

Only if your business is in the US.

If your business is outside of the US you do not have to supply them with any annual tax return because your accounts are nothing to do with the US, that's the whole point of completing a W-8BEN

Do you have a link for this? I remember reading about it somewhere, but I can't find it anymore.

luceluceluce · « **Reply #312 on:** June 02, 2009, 01:55 »

Quote

I guess I would try to understand Serbia's Tax laws before I did business there. As anyone should have done before doing business with a US company. You are responsible for yourself. Ignorance of the laws is not an excuse.

You do do business in serbia. You do do business in the UK. Stock sites have international customers.

The difference is that these countries are not requiring you to apply for their tax number via a long, costly and difficult process.

If anybody makes this point again.... please can you also quote the Japanese, German, Russian, British, Latvian tax numbers you have applied for to prevent them automatically withholding 30% of your earnings.

Or it is only the IRS who is not keeping to the spirit of the exisiting treaties?
x

luceluceluce · « **Reply #313 on:** June 02, 2009, 02:07 »

Russians! hi!

I guess you guys are talking about all this on russian forums. Can any of you give us an update on what the consensus is on the Russian forums?

Chinese! Hi!
I guess you guys are talking about all this on Chinese forums. Can any of you give us an update on what the consensus is on the Chinese forums?

Japanese! Hi!
I guess you guys are talking about all this on Japanese forums. Can any of you give us an update on what the consensus is on the japanese forums?

Other nationalities too:
It would be really great to get your perspective because it's mostly native english speakers here so it could give an inaccurate picture... what is the consensus on your forums?

Lucy x

luceluceluce · « **Reply #314 on:** June 02, 2009, 02:33 »

It is now possible to buy olive oil easily in supermarkets in India. It is now possible to get a phone without a 3 year wait. It is now possible to buy solar panels.

more more more more more more more more.

But not before. Why? Because the Indian government made it difficult to do business in india.

Then they deregulated. They are the largest democracy in the world, and now have a middle class in the hundreds of millions.... and growing.

You will not have to apply for an Indian tax number. You will not see India applying automatic withholding. They understand the lessons of the past and are looking to benefit from international business.

The bottom line is surely is: You put up obstacles to conducting business, you lose business.

These double taxation treaties were introduced to deal with a world of international business. If the US is using the letter of the treaties to clawback the tax... how long does it expect other countries merely to obey the spirit?

if we don't call attention to this issue now: then maybe soon it will not be a joke... and we will need to apply for multiple tax numbers to avoid double taxation. Imagine the paperwork then : (

x

Milinz · « **Reply #315 on:** June 02, 2009, 05:33 »

@ alpy7

Quote

I guess I would try to understand Serbia's Tax laws before I did business there. As anyone should have done before doing business with a US company. You are responsible for yourself. Ignorance of the laws is not an excuse.

You obviously don't know what you are talking about!

If I knew that I will pay my tax to USA Government instead of my country government I'd better make my strategy on what to sell where.

There is Alamy for example where anyone can sell with not needed to pay such 30% non-treaty tax because UK as traditional and respected country in the world have signed such treaty with almost any country on this planet.

So, Tax from USA IRS comes AFTER a Years of building portfolio. It was NOT NOTED IN CONTRIBUTORS AGREEMENT THAT USA WITHHELD 30% TAX from Non-treaty contributors.

There is it and I PAY MY TAXES TO MY COUNTRY.

Nevertheless your talking about Law brings to my mind that USA BOMBS have killed many kids and other civilians in my country. So, There is no way I can be happy to pay ANY TAX to US GOVERNMENT!

[EDIT] Just to add: Any agency should have clear agreement with authors. There should be all writen in that agreement so not any problem rises between parties. Here we have pure example of badly writen agreement and turning authors to something they wasn't aware of! After all Agent is called agent because AGENT TAKES CARE ALL TO BE IN ORDER TO SATISFY AUTHOR AND CUSTOMER AND WITH STRICT COMPLY TO LAWS!

I am CEO in an agency. I know how it is to be run!

RT · « **Reply #316 on:** June 02, 2009, 06:09 »

Quote from: Milinz on June 02, 2009, 05:33

I am CEO in an agency. I know how it is to be run!

If you are you should have a better understanding of international business procedures then. Or doesn't your agency sell through one of the biggest markets in the world.

Like it or not, moaning and whinging like a child will not escape the obvious solution which is to fill out the forms, comply with the tax laws in your country and any countries you do business in, this US tax law is not new, it's not unique to the stock industry and it's not Shutterstocks or any other agencies fault that your country and the US do not have the same treaty as others, either accept and deal with it or find another business.

StockManiac · « **Reply #317 on:** June 02, 2009, 06:59 »

I find it very interesting how the only people whining like babies about this are the people with extremely small portfolios. And if I was Jon, I would remove your portfolios in a second.

I don't see any of the large portfolios complaining about this. And they have the most to lose financially from this. Why is that? Where is the complaining from the top portfolios in the world (Mr. Arcurs, or Ms. Pargeter, or Andresr, etc. etc.)? They stand to lose large sums of money from all of this. Yet are they moaning about this on the forums?

This topic seems to have become an issue about U.S. politics (and should probably be moved as such to the ranting forums). Well, let me tell you what the U.S. has done for most of you. We have saved your butts from two World Wars. Most of you would be living under a flag from Nazi Germany or the Land of the Rising Sun if it wasn't for the U.S.

You bitch and moan about the U.S. all the time, yet they are the ones that "keep the peace" around the world. They could have conquered the world ten times over already, yet they are content with their small slice of the world over the pond.

Many of you complain about double taxation, yet many of your counties use a VAT system, which is the epitome of double (and triple and quadruple) taxation.

Why don't you people just get a life!

Eco · « **Reply #318 on:** June 02, 2009, 07:32 »

Interesting to note that most of the persons that defends SS has failed to mention that the "childish and amateurish ranting" of non-US photographers has already lead to the admission of SS of two important "mistakes" in their initial message about the tax issue. One being the issue of the validity of the letter that they send to members to attach to form W-7, and secondly the admittance that the 30% withholding only applies to income from sales to US customers. Furthermore, it seems that SS is now considering several other (important) questions that is not yet answered/clarified.

Imagine everyone just accepting the original SS notice and proceeded with the instructions as originally given. While it is unfair to blame SS for complience to the US tax laws it is clear that they did not do their homework adequetly before dropping this bomb on their loyal submitters. In the end this breach of confidence can only harm SS.

I also find it difficult to accept that SS and many fellow photographers can be so insensitive and unsympathetic to those photographers in non-treaty countries that will lose 30% of their SS income (and still pay taxes on the remaining income in their own countries). Microstock is already paying pittance and to lose 30% of your income due to irrational laws is a shame. If and when stock sites accept co-responibility for this mess you can be assured it will only come as a results of pressure from the "childish and amateurish ranting" of those that care to speak out.

hqimages · « **Reply #319 on:** June 02, 2009, 07:56 »

The reason people with small portfolios are most vocal, is because it will cost them their yearly salary just to process the papers for this thing.. then they potentially lose 30% in America before losing more in their own country, so it's not viable for small contributors to actually go through with this..

Suljo · « **Reply #320 on:** June 02, 2009, 08:10 »

I find this on Panthermedia so maybe something similar exist in US tax laws

Income when you do not have a registered (small) business

As long as you are not pursuing long-term profit-making activity with your photography, you do not need to register as a business with the relevant authorities. The tax authorities recognize the earnings as "hobby". Under German fiscal law, a hobby is an activity that is conducted without any intentions of making taxable income. Any income that is made out of this activity is not taxable, and any losses incurred also cannot be claimed as deductions.

Dark_Angel · « **Reply #321 on:** June 02, 2009, 08:20 »

Quote from: StockManiac on June 02, 2009, 06:59

I find it very interesting how the only people whining like babies about this are the people with extremely small portfolios. And if I was Jon, I would remove your portfolios in a second.

I don't see any of the large portfolios complaining about this. And they have the most to lose financially from this. Why is that? Where is the complaining from the top portfolios in the world (Mr. Arcurs, or Ms. Pargeter, or Andresr, etc. etc.)? They stand to lose large sums of money from all of this. Yet are they moaning about this on the forums?

This topic seems to have become an issue about U.S. politics (and should probably be moved as such to the ranting forums). Well, let me tell you what the U.S. has done for most of you. We have saved your butts from two World Wars. Most of you would be living under a flag from Nazi Germany or the Land of the Rising Sun if it wasn't for the U.S.

You bitch and moan about the U.S. all the time, yet they are the ones that "keep the peace" around the world. They could have conquered the world ten times over already, yet they are content with their small slice of the world over the pond.

Many of you complain about double taxation, yet many of your counties use a VAT system, which is the epitome of double (and triple and quadruple) taxation.

Why don't you people just get a life!

did you understand this is not about war, but about taxes?

And it does not surprise me at all that it harms small contributors the most! When you make 30 dollar per month since you do this as hobby and then have to decide whether to spend a few hundred Dollars to get an ITIN or accept losing 30% of those 30 dollar per month. What would you do?

bittersweet · « **Reply #322 on:** June 02, 2009, 08:45 »

Quote from: Suljo on June 02, 2009, 08:10

I find this on Panthermedia so maybe something similar exist in US tax laws

Income when you do not have a registered (small) business

As long as you are not pursuing long-term profit-making activity with your photography, you do not need to register as a business with the relevant authorities. The tax authorities recognize the earnings as "hobby". Under German fiscal law, a hobby is an activity that is conducted without any intentions of making taxable income. Any income that is made out of this activity is not taxable, and any losses incurred also cannot be claimed as deductions.

In the US, if you want to be able to deduct your expenses, your "hobby" can only operate as a loss for a limited time (I think it used to be 3 years, but I'm not sure what it is now.). If you don't report any income, then you can't deduct any expenses.

Milinz · « **Reply #323 on:** June 02, 2009, 08:47 »

Quote from: RT on June 02, 2009, 06:09

Quote from: Milinz on June 02, 2009, 05:33
I am CEO in an agency. I know how it is to be run!

If you are you should have a better understanding of international business procedures then. Or doesn't your agency sell through one of the biggest markets in the world.

Like it or not, moaning and whinging like a child will not escape the obvious solution which is to fill out the forms, comply with the tax laws in your country and any countries you do business in, this US tax law is not new, it's not unique to the stock industry and it's not Shutterstocks or any other agencies fault that your country and the US do not have the same treaty as others, either accept and deal with it or find another business.

You are talking rubbish... It doesn't have anything to do with international business handling. ALL INTERNATIONAL BUSINESSES have OFFICES AND ARE FUNCTIONING ON TAX AVOIDANCE PRINCIPLES TO BE COMPETITIVE!

IF you think that is something differently then you are making very big mistake!

One thing is to buy camera and take photos... Completely other is to run some business when you need to think how to make enough job for all your employees as well to keep your business live on todays crazy market and even craziest taxing in some countries!

Dook · « **Reply #324 on:** June 02, 2009, 08:48 »

(Quote from: StockManiac :
I don't see any of the large portfolios complaining about this. And they have the most to lose financially from this. Why is that? Where is the complaining from the top portfolios in the world (Mr. Arcurs, or Ms. Pargeter, or Andresr, etc. etc.)? They stand to lose large sums of money from all of this. Yet are they moaning about this on the forums?)

What are you talking about? These guys are not going to lose their money. They do not come from non-treaty countries. One of their emplyees will do the paperwork and that is it. Why would they complain.

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Author Topic: IRS Withholding Taxes for non U.S. Submitters (Read 126790 times)

gbalex

luceluceluce

sharpshot

Milinz

alias

snaprender

RT

luceluceluce

Milinz

luceluceluce

luceluceluce

Maui

luceluceluce

luceluceluce

luceluceluce

Milinz

RT

StockManiac

Eco

hqimages

Suljo

Dark_Angel

bittersweet

Milinz

Dook

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