You’re kind of right, but you’re kind of wrong. Everyone in the UK has to pay tax on their earnings. The majority of people have this all done for them through their employer. However, if you earn money directly from your own business, then you need to register with HMRC so you can report your earnings and pay the appropriate tax.
At that point, at a minimum, you’d be registered as self-employed… so although you may not be a proper ‘business’ or a registered company, you’re still essentially the owner of your own self-employed business. Whether you be dog-walking, a market-trader or selling on Envato.
And filling in your W8 with your tax details isn’t really avoiding tax… it’s just avoiding paying tax twice. You’ve got to pay a % somewhere, so if you fill in the W8 then you’re just paying the tax in the UK rather than the US. As for not having a tax number… I’ve still not entirely figured out whether we can use our National Insurance Number, or whether we need to use out Unique Tax Reference. The latter is issued when you register as self employed. The former, you get just for existing! I went for the UTC to be on the safe side.
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It’s not VAT, just to clarify. If VAT is added to your item for EU buyers, then that doesn’t affect the amount that you get… it’s a value added tax that it paid by the buyer, not the seller.
How much is this item that you’ve had 20% taken on? Might be able to figure out if it’s right or wrong. And did you fill out the W8 with a tax ID number?
Apology for my mistakes it turns out the EU Buyer, Sorry for this. I already finish the W-8 form and fill the ITIN number. Thanks for your assistance.
Thanks, that’s a big help. I did half-know this stuff already, I just needed someone to spell it out. 
Just a quick question… Does the marketplace system continue to run on AEST or is that being changed?
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Hi Adam,
If I understand correctly, you mean the features in favor of authors are not 100% ready and need more time to be tested before being launched, however the US Royalty Withholding Tax is working right in time? Please correct me if I’m wrong.
Based on my first sales, the US RWHT is being applied. I would like to see changes in favor of author’s high priority more often. But really, High priority, not only the promise.
Sorry for being picky but your answer sounds like a nice way to say you didn’t made your work on time. Very disappointing.
Happy New Year all! 
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The marketplace continues to run AEST.
Adam
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Why there was a tax deduction when a user of France purchased my item?
Why don’t you pay taxes from the 50% fee you are changing, other freelancing website’s are doing the same
There shouldn’t be tax deduction on non-US sales if you’ve completed a W-8 form, have you completed a W-8 form?
I do’t know what will Envato gain by becoming a US based company. But they will surely loose so many authors because now author’s commission will be less than what other companies are paying to authors.
I agree with the @theawesomecoder
Envato should pay all these taxes from the 50% they get from every sale. Now authors who used to get 50% from every sale will get only 30 or 35% .
I ask the same question. It’s a mistery!
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Hi Soundgridmedia, I had a quick look at your statement but don’t see an example in there of US RWT. I suggest you find a specific example and send an email to taxinfo@envato.com
This email is answered by our international Tax expert.
Cheers,
Adam
Hi theawsomecoder,
It looks like you have not submitted a w-8 form.
If you have not submitted a valid W-8 form then the US govt requires us to assume you are from the US and you are charged US BWT.
If this is the case, the easiest solution is to submit a valid W-8 form. See previous links from Natman if you need further direction on how to do that.
Hope this helps
Adam
Hi loveishkalsi and htmgarcia,
The taxes are totally dependent on the seller’s business arrangements.
If envato paid everyones taxes for them, there would be no incentive for authors to optimise for global business, and the total amount of tax paid would probably be massively more.
For authors that have a valid w-8 submitted it is only sales of affected items that are subject to US RWT, which are as low os 0% for some countries.
Some other sellers do not have a valid w-form in place, and we are required by law to assume they are US and apply US BWT at 28% of the entire amount the buyer pays, hence the total amount of tax is substantially greater.
However I do appreciate there is a net financial impact on authors and there are costs of doing business globally.
Cheers,
Adam
I dont make enough money to pay tax so I dont have any tax ID no. Thats why I am selling script on envato. What shall I fill in W-8. Is that my fault?
I dont have tax Id as I dont earn enough to pay tax. And now my earning will go further go down with envato new policy. Now I will have to find new market