I must to pay 10% tax from my royalty! Not from full price of video!

Hi Envato!

Why do I have to pay a 10% tax on the full price of the video (minus $ 3 Buyer fee), and not 10% from my royalty?

For example:
49$ - price of video.
Minus 3$ - Buyer fee = 46$.
4.6$ - tax (I pay)

This is not justly! I must to pay tax from my royalty!

Fix it, please.



It’s right. Why it’s right, I’m not entirely sure, but if it was wrong then they’d be doing it differently… so it’s unlikley to change any time soon.

But still… the amount withheld can be used to offset the amount you have to pay in your own country, so it all evens out in the end.

Is this the first time you’ve checked your statement page since 2015?

The IRS Publication 515 “Withholding of Tax on Nonresident Aliens andForeign Entities” regulates who must withhold and also the determination of amount to withhold.

In the chapter about the Withholding Agent (Envato) it states:
You must withhold on the gross amount subject to chapter 3 withholding. You cannot reduce the gross amount by any deductions.

The gross amount of a sale to a US customer is the List Price minus the Buyer Fee.
The IRS does not care whether Envato is also charging author fees on a sale or not, they want to have their source tax from your gross amount of a sale.