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

[KineticCreatives]

Where do we find these forms and where do we send it?

[UXBARN]

Yeah, I am thinking the same. The key here is that Envato should give us more info on how this change is going to bring more sales from the US. There’s only a small point in their post mentioning about payment methods. I just feel like they didn’t say it all somehow…

[meta4creations]

Do we have to go to the American Embassy in our country to get the Taxpayer Identification Number (TIN) ?

[mrpsiho]

What about payments to Payoneer card for the authors based outside the USA? Will be this possible or not?

You wrote:

As of January 1st 2016 we are streamlining our withdrawal system.
Withdrawals will only be processed to the nominated account holder
payment details and the country must match the one on the completed W-8
or W-9 form.

So, if I am a resident of one of European countries but I still want to receive payments on Payoneer account. Will be this possible for me?

Thanks for the answer!

[scrobbleme]

Even thinking about this costs us more money, than we will probably ever earn with Envato…

1. How should I fill in this form? Please provide some help in authors native language, so they are able to understand it.
2. Please pay out income more quickly, as everythingI see is, that we have to pay a hell of fees upfront, but still have to wait for like whatever to get our own money…
3. Simplify
4. Simplify
5. Simplify (I really don’t get why everything is splitted in so many transactions, as an author maayyybe, as a buyer, it is just stupid an confusing…)

[Firsh]

Meh. Just meh.

[gassh]

Hi friends, anyone know how I can get my tax ID number ?.It is that all this seems confusing. I am from mexico.

[WPPixelprint]

Someone please elaborate, how it affects withdrawals from Payoneer?

[gassh]

I have the same question

[anon53351623]

I’ll be withdrawing my items from the audiojungle market at the end of the month.

[natman]

Hi all, here’s the first round of Q&A. We’ll collect new questions as they come in and aim to post another batch of answers in the next day or so. Thanks!

What does this mean in layman’s terms? There is a possibility to receive 0% to 30% less per sale from US buyers?.. If so what is the process to claim that back?

That’s correct. The rate and process to claim back your tax credit (if eligible) is different from one country to the next. Please check out the help center article (particularly the FAQ section at the end) for more info and consult a local tax advisor for country-specific details.

I have a exclusive and a non-exclusive audio jungle account, both payments go into the same Paypal account. Will I still be getting both separate payments from each account on the 15th of each month?

Yes. The restriction of one withdrawal destination per month is at the Envato user account level, not the PayPal account level.

Does that mean that nothing changes at all for german authors since the royalty copyright thing is 0?

For countries with a 0% royalty withholding tax rate, authors who submit a validly completed W-8 form will see no reduction of income on Envato Market (and no tax credits).

The tax is calculated from gross earning or net earning?If from gross earning, then it will be the end for non-exclusive authors who their country doesn’t have tax treaty with US. Because it means they’ll get only ± 6% from their item sales. LOL

The tax is applied to the Item Price that an item sells for. A specific example might help in this case.

Take a Magento theme, that has a List Price of $100. In this example, $20 of the list price is Envato’s Buyer Fee. The Author is charging an $80 Item Price on that Magento theme, and if sold to a US buyer, then US RWHT tax will be applied on this item price.

In the case of an author in a country with no tax treaty, then RWHT is 30% if the sale is to a US buyer. So $24 will be withheld and remitted to the IRS. For a non-exclusive author, $44 is charged by Envato as our Author Fee. The Non-exclusive author will receive $80 - $44 - 24 = $12 in this example sale.

Only sales to US buyers will have this tax applied. But I agree, it’s not great for non-exclusive authors, and something we’re reviewing.

But if you don’t register with the US tax authorities, sales to US buyers will be taxed 28%.

If you don’t complete a W-8 form, we’re required by the IRS to apply something called the Presumption Rules. They are a series of complex rules, and the upshot is that we presume that you are a US author who has not completed a tax form, and therefore Backup Withholding of 28% of all sales is applied.

In order to lodge Form W-8 we do not require you to register with the IRS the form will be accepted with your local tax identification number.

Knowing that my country doesn’t have any kind of tax treaty with US, that means I will be paying 30% tax?So it’s better for me to now fill the form and pay 28%?

Not quite, WaveNebula. If your country doesn’t have a tax treaty with the US and you’ve completed a Form W-8, you will be charged 30% on the Item Price to US buyers only. If you don’t complete a Form W-8, then we are required to follow a set of rules that defaults to assuming you are a US author who has not completed a W-9 form, and are therefore subject to Backup Withholding tax of 28% applied to all of your sales on Envato (irrespective of where the buyer is based).

For my country, i see withholding tax rate as 0 (zero) for royalties. What does it mean? 0 percents of withholding from my US sales? Or whole 28% will be withholded from my US sales?

For countries with a 0% royalty withholding tax rate, authors will see no reduction of income (and no tax credits) on Envato Market, provided they submit a valid Form W-8.

We all know that at least 60-70% of the buyers are from USA.

Our analysis indicates authors should expect around one third of their sales to have US RWHT applied.

Its just like envato is telling us NO MORE PARTNERSHIPS. I bet here many authors(developers) have multiple partners who send multiple payment in a month. But as per new rule its not gonna work.

Our approach to author collaboration hasn’t actually changed. We’ve had this Help Center article about author collaboration up for some years which sums up our approach on this subject. You are correct however that our withdrawal system will be a lot less flexible. This does mean some authors will need to rearrange their cashflow practices.

I’m an individual, not a US person and have no Tax ID Number, what should I do?

Because there is so much variation from country to country, it’s best to speak to a tax advisor or accountant to work out what is the appropriate number to use in your country.

Here in Australia for example we have a system called the Tax File Number (TFN) which individuals or businesses can have, and you have to go to the tax office to apply for one. Different countries will vary.

As per the IRS Form W-8 instructions (see Line 6), if you don’t have a foreign tax identity number, you are not required to provide one and you can leave this question blank.

[DenishPatel]

it may be less for your country , not for all authors .

[gassh]

Hi, this question is for envato team, you say that in case of not having tax ID number can be left blank in the document that. But the system will not let me form my case. I listed as mandatory and I do not have an ID.

[bigtreeisland]

When you are making 12$ for 80$ item you need to seriously question your business model…

[phpface]

Because there is so much variation from country to country, it’s best to speak to a tax advisor or accountant to work out what is the appropriate number to use in your country.

Here in Australia for example we have a system called the Tax File Number (TFN) which individuals or businesses can have, and you have to go to the tax office to apply for one. Different countries will vary.

As per the IRS Form W-8 instructions (see Line 6), if you don’t have a foreign tax identity number, you are not required to provide one and you can leave this question blank.

Thank @natman for your reply, my apologies for stupid question, I have nothing with Tax at my country and it isn’t problem for working with my Government.

so what should I do?

[chilly_orange]

Thanks for this first round of answers… it appears it’s indeed as bad as many of us were fearing. I asked the following question which hasn’t been answered yet:

What will happen to the personal information I put in this form? Is this all sent to the US government?

[purethemes]

Along with more growth opportunities, being in the US will help us service US buyers with more targeted payment methods leading to better conversion rates and happier buyers.

those are just nice words and marketing - all this is just probably some tax evasion or other serious stuff we don’t know and won’t know true about - I can’t imagine any other reason. As chilly_orange said “US buyers already had access to the market sites;” and are already responsible for 60-70% of sales (at least my sales)

[leadsquid]

As I understand, if I don’t have Tax ID number I must fill physically the W-8 document (leaving the line 6 blank), scan and send it to Envato instead of filling Tax insformation in my profile.
Is that correct?

[n2n44]

pls give u a break … lol i am laughing out loud with this one lol they are basically having a very huge deal of their sales in USA today and they will expand there lol when they have lots of developing countries and territories in which sales are rather low despite markets are expanding and they will choose to go where they are very strong and get stronger there , in other words, they will probably get a bit more sales but so very much of them, really ? when u are at capacity 80 % for instance are u having so much potential to grow that very big again? or is that by developing where sales are not so huge at this time that u can have a spectacular increase? i don’t know why but in my case, i am likely to believe that this is where u have small market that u can grow really way bigger , not the other way around … . One last thing, this marketplace system is increasingly known in USA … and that’s why u have such a huge amount of sales from there , both from professionals and from private people who need an invitation or whatever … i am really not sure that knowing just that this whole development thing is a smart move … time will tell, but authors get ready to get even less money at least if this is not what happens that will be the miraculous surprise that u could not expect for in the first place …

[gassh]

I get the same question …