What is "US Backup Withholding Tax"?

I’m not a follower of the forum so I don’t really know what’s going on but previously I used to get paid $20+ per sale but now I’m getting paid $13. Why is that? What is “US Backup Withholding Tax”?

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You will be charged this tax on all US sales now if you didn’t complete a W8 form before Dec 31.

@MattyFrench But according to the invoice, the buyer is not a US citizen. Some are from Turkey, some from Albania and etc.

You do not provide a W-8 form last year
details: https://help.market.envato.com/hc/en-us/articles/205658994-Tax-Information-Form-W-8-Requirements-for-non-US-Authors#backup

I don’t have a Tax ID, will filling up the form work?

Oh, then I don’t know. I was under the impression that the withholding tax would only be applied to US sales.

In Canada, you can use your Social Insurance Number (SIN) as a foreign tax ID. Your country probably has something similar.

If you fill in a W-8 form without a Tax ID Number or ITIN, you’ll have 30% withheld on US sales only rather than 28% withheld on all sales if you don’t fill in a W-8 form at all.
I can see your country of residence is Bangladesh, so if you fill in a W-8 form with a Tax ID Number or ITIN, then you’ll have 10% withheld on US sales only.

Note that the withholding tax rate is deducted from the item price. The item price is 80% of the price you see on an item page.

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Hi, what will happen if I complete W8 form only in January? I don’t have any sales yet though.

I’m not sure actually, they made it sound like if you hadn’t completed one by Dec 31st you would be charged taxes in the new year. I would ask one of the Envato people if I were you.

If we do fill it out, they will NOT withhold tax, or it just changes the withholding amount?

Hi,

I am a U.S. taxpayer and I am not subject to backup withholding… Why is Envato deducting backup withholding from my commissions? No other affiliate program I am part of does this…

hey guys ,

I’ve sold and item yesterday , the problem it’s 5 item i only got 1.38 i don’t know why it’s only on this item or for all my sales now

Hi,

Since January 1 you will be charged taxes on all US sales, more information about this can be found in this announcement: http://inside.envato.com/usa-tax-withdrawal-changes/

Hope this will help you out :smiley:

thank you for your answer , I am tunisian and am a student i’ve filled an W8 form but i don’t have a tax id in my country , does that mean evnato will cut 30% of my sold item to US buyers ?

Hi,

When you are unable to provide Envato with the details needed in the W8 form Envato will take 30% from your sold items.

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Tunisia:
W-8 with Tax ID = 15% tax on US sales only
W-8 without Tax ID = 30% tax on US sales only
No W-8 = 28% backup withholding tax on all sales

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how can i get a tax ID ? does that mean they will take now 30% tax on US sales only

the same problem neighbor!

I have had an audio jungle account for the past week or so and made 6 sales, but I have just noticed on my 6th sale i’ve been charged tax of 30%. I am based in the UK and am currently trying to get a ITIN tax number so i won’t be charged this 30%.

After I have obtained this tax number and filled in the W-8 form, will all my previous sales that I have been charged tax on be removed and added to my account?

e.g. I made a sale today and have been charged $4 backup withholding tax. when i’ve filled in the W-8 form will this $4 go back into my account?