Important Changes for Non-US Authors/Affiliates/Service Providers

Hey everyone. I am from Belarus. Can anybody say what tax (%) I will pay for sales to US buyers?

All tax information per country can be found here, I hope this helps :smiley:

0% Apparently.

https://www.irs.gov/publications/p515/ar02.html#en_US_2015_publink1000225127

thx! =)))) one more question:
I’m not a US author. I don’t have Foreign Tax ID Number. What should I do?

You need to get one, or you’ll have 30% withheld. You need to speak to an accountant or tax advisor.

read this, & tell me what you underderstand please Important Clarification re. W-8 Form for Non-US Authors, Affiliates & Service Providers

If there will be such a document, I think not everything is lost. In theory tax authorities can subtract the “US amount” from my local taxes. Now remains the question of convincing them to do that.

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I understand nothing. really

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There’s a link to an example from in one of the answer posts from Envato. Will post it again if I can find it. It’s an official looking document form the IRS with details of all the tax you’ve paid to them in the past year. Should do the job if your country has a double tax agreement.

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Well let me tell what i understood,

You have to apply for W7 form, which should give you an ITIN fom the US authorities, ( you can find it here https://www.irs.gov/Individuals/General-ITIN-Information ) under “How do I apply for an ITIN?”.

The only problem i have with this is that you should send a physical copy of the for to the address they provided !!

Correct me if I am wrong. In the past when US buyers bought items on envato marketplace, it is the Envato Australia that sold the items to the US buyers, so they, as an Australian company, (according to the US tax treaty table) had to pay 5% withholding tax. By having a company in the US, they don’t have to pay this 5% anymore and the US buyers would feel more secure and confident to buy items from US company. Killing 2 birds (and a lot of authors – not intentionally) with one bold move.

Having said that, since having Envato US would save Envato Australia 5%, wouldn’t it be fairer to reduce the author fee to compensate the authors.

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I don’t understand Collis here. We’re here talking about a company that makes more than a huge amount of money every hour and will be more than enough to cover the expenses for such a function. The function is not even hard to set up and I believe, in my good faith, that Collis know that.

Hey @collis this is very interesting. Actually since @Dream_Theme mentioned their LLP based in UK, i have studied more and actually let my accountant know to see if it’s a good solution for me too. I’m also waiting for your updates on this one and it would be great if you can have a chat with @Dream_Theme about this one (hopefully Miroslav will contact you).

& @htmgarcia @devotchkah and others concerning partnerships. This shouldn’t kill partnerships at all. I had a talk yesterday with my accountant and we’ve written around 4 solutions of handling this and for one of them i’m still waiting to see Collis’s updates on UK’s LLP.

It’s quite a stress for me too as i have to change some things in my business model and how to “subcontract” my partner/s and deduct his cut, legally for both of us. Luckily my partner is from the same country so it might be easier for me, but for others, it’s best to talk with your accountant to see how you can sub-contract your partners (or declare them as copyright holder maybe?), deduct their share as business expenses. I think this one might vary from country to country.

I agree. They can’t hide behind the laws, they should be compensating their authors. If they don’t do it, I think we’ll see that authors migrate to other sites. We, as a company, have never had to sign this kind of forms or pay taxes for a company we don’t own. All of these companies that we’ve worked with before and still work with today is located in the US and are huge sized companies, some smaller than Envato and some bigger than Envato.

Envato is primarily the seller as they set the item pricing and control all of the transactions and refunds. Author’s just make the content so it is a little strange as to why the authors should pay tax on the behalf of Envato.

A little frustrating for a lot of authors as even though some countries have to pay no tax to the US some authors from much poorer countries will be worse off which isn’t a very equal opportunity for those who possibly make a living out of Envato.

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A lone exception…

Yes Palzme. That’s true, Envato is the seller, not the authors. That’s the way the other sites we make assets for works and it’s the way it should work. As you mentioned, the authors make the content, Envato sells it. So in plain clear text: we as authors do no business with the USA, Envato does. Therefore, Envato, is the only rightful part in this to pay the tax and Envato should work like it’s always done.

Yes, although for them it can be a win win opportunity as instead of the 5% tax they will pay 0% and this will possibly be a step towards a future IPO as many have stated too

Well I’m not sure what metric you use for defining ‘poor countries’, but you’d be hard pushed at describing Bangladesh, Estonia, Latvia, Lithuania, Pakistan, Romania, Slovakia, Slovenia, Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldava, Tajikistan, Turkmenistan and Uzbekistan… as ‘rich countries’.

@collis @natman - Hi, If an individual is running multiple accounts do they need to fill out their respective W form under each account? Thnks.