Tax questions for non-US authors

atanner · 11-07-2012, 08:12 AM

Hello All,

I was wondering how non-US based authors deal with the US "withheld tax" issue when you sell your books via Amazon...

Questions:

1) If you are in the UK/Europe...isn't it just possible to limit your sales to all domains EXCEPT amazon.com (thus amazon.de, .co.uk, .it, .es) and make your books available ONLY via European channels? If this would be so, are there other tax issues you have to deal with (as an EU resident) if you only make your books available via European Amazon sites or is it just a matter of paying your local taxes, VAT and that's it?

2) Has anybody here ever gotten past the red tape of getting your US taxes back? I say this, because the way I understand it...every time you sell a book on amazon.com, if you are not in the US, you just lost 30% of your revenue...which is of course, undesirable...

Thanks

Edward M. Grant · 11-07-2012, 10:54 PM

You need to get an ITIN (if you're an individual) or EIN (if you're a business). The latter apparently just requires a phone call, the former requires a huge amount of bureaucracy for many people.

Where are you living? You mentioned the UK, and from what I understand, you can just go to the US Embassy in London with your passport and the forms to get an ITIN rather than having to mail your passport to America.

gmw · 11-08-2012, 07:06 AM

I'm trying to deal with this at the moment too. I'm in Australia. Australia does have a tax treaty with the U.S. which means the income is not supposed to be double-taxed. So I have the choice of registering for an ITIN (and Amazon etc. will still withhold 5% for Australian's anyway - maybe it's because we were once a convict colony), OR I can just let them withhold the full 30% and show it on my tax return at the end of the year, in which case (if I understood my accountant properly), the withheld amount shows as tax already paid and so it should all come out in the wash (so to speak).

The other side of all that is that, in Australia, income from hobbies are not (in certain circumstances) taxable (and so the expenses are not deductible). So while the income remains small it may have been feasible not to declare it ... except for this aspect of Amazon (and Smashwords etc.) withholding tax and making life complicated again.

See the recent "BookBaby experiences" thread for discussion there about the fact that BookBaby does not withhold tax or require an ITIN (but they do require that you pay for their services).

avantman42 · 11-08-2012, 07:30 AM

I wrote about how I got my ITIN on my blog: http://russellphillips.wordpress.com...nt-pay-us-tax/

It's a convoluted process, but I didn't have any real problems.

MartinC · 11-08-2012, 11:11 AM

Quote:

Originally Posted by gmw

See the recent "BookBaby experiences" thread for discussion there about the fact that BookBaby does not withhold tax or require an ITIN (but they do require that you pay for their services).

If you distribute via BookBaby and include Amazon in the outlets where your books will appear, you can still get Amazon's 70% royalty deal. This means that it's really down to how many copies you expect to sell in the US.

It's all a bit academic for me: the US tax I would recover by going up to the embassy to get an ITIN would not pay for the train fare.

mr ploppy · 11-08-2012, 11:43 AM

Just charge extra for the American ones. There's a section on the UK tax form for foreign income that has already been taxed at source. You might need to ask for that page if you are on the short form.

atanner · 11-09-2012, 05:45 AM

Funny but, you can use the Amazon European platform (which would be exactly what I am looking for) for selling EVERYTHING....except.....e-Books??? The ONLY way to sell eBooks right now, is via the .com platform...

How is it possible that out of ALL companies, A-M-A-Z-O-N doesn't allow you to sell books for kindle from the UK/Europe???....but you can sell your old shoes, a new paper book, or some face cream!?!?!.....

Hopefully they change their policy and have a REAL European platform from which Europeans can sell through, without having to go through hoops...

Gina Rossi · 11-13-2012, 08:47 AM

The ITIN application is dead easy. I needed a letter from my USA publisher to confirm that I am published by The Wild Rose Press. Secondly I needed a validated copy of my passport. Take your passport to the highest Home Affairs authority in the land eg. if you are a British citizen living abroad, take your passport to the local British Consul. He will copy it, validate it, and verify that he is verified to validate it (I know, hey?). Complete your ITIN form without using any abbreviations, enclose your passport copy, publisher's letter and airmail it off. I waited 4 weeks and hey presto, ITIN number!

PainMike · 11-13-2012, 11:52 PM

If having a tax treaty with U.S; after receiving the ITIN, you type it into W8-BEN form, warranting your foreign status. It is usually sent to the U.S. company you are paid from and should be also found from their pages, from IRS pages at least. W8-BEN is due update every 3rd year if I'm remember correctly.

11-07-2012, 08:12 AM	#1
atanner Member Posts: 21 Karma: 1708106 Join Date: Nov 2012 Device: none	Tax questions for non-US authors Hello All, I was wondering how non-US based authors deal with the US "withheld tax" issue when you sell your books via Amazon... Questions: 1) If you are in the UK/Europe...isn't it just possible to limit your sales to all domains EXCEPT amazon.com (thus amazon.de, .co.uk, .it, .es) and make your books available ONLY via European channels? If this would be so, are there other tax issues you have to deal with (as an EU resident) if you only make your books available via European Amazon sites or is it just a matter of paying your local taxes, VAT and that's it? 2) Has anybody here ever gotten past the red tape of getting your US taxes back? I say this, because the way I understand it...every time you sell a book on amazon.com, if you are not in the US, you just lost 30% of your revenue...which is of course, undesirable... Thanks

11-13-2012, 08:47 AM	#8
Gina Rossi Junior Member Posts: 5 Karma: 10 Join Date: Nov 2012 Device: Kindle	ITIN applications The ITIN application is dead easy. I needed a letter from my USA publisher to confirm that I am published by The Wild Rose Press. Secondly I needed a validated copy of my passport. Take your passport to the highest Home Affairs authority in the land eg. if you are a British citizen living abroad, take your passport to the local British Consul. He will copy it, validate it, and verify that he is verified to validate it (I know, hey?). Complete your ITIN form without using any abbreviations, enclose your passport copy, publisher's letter and airmail it off. I waited 4 weeks and hey presto, ITIN number!

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11-07-2012, 10:54 PM	#2
Edward M. Grant Zealot Posts: 129 Karma: 3000000 Join Date: Jun 2012 Location: Canada Device: Kindle Keyboard, Asus Transformer	You need to get an ITIN (if you're an individual) or EIN (if you're a business). The latter apparently just requires a phone call, the former requires a huge amount of bureaucracy for many people. Where are you living? You mentioned the UK, and from what I understand, you can just go to the US Embassy in London with your passport and the forms to get an ITIN rather than having to mail your passport to America.

11-08-2012, 07:06 AM	#3
gmw cacoethes scribendi Posts: 5,809 Karma: 137770742 Join Date: Nov 2010 Location: Australia Device: Kobo Aura One & H2Ov2, Sony PRS-650	I'm trying to deal with this at the moment too. I'm in Australia. Australia does have a tax treaty with the U.S. which means the income is not supposed to be double-taxed. So I have the choice of registering for an ITIN (and Amazon etc. will still withhold 5% for Australian's anyway - maybe it's because we were once a convict colony), OR I can just let them withhold the full 30% and show it on my tax return at the end of the year, in which case (if I understood my accountant properly), the withheld amount shows as tax already paid and so it should all come out in the wash (so to speak). The other side of all that is that, in Australia, income from hobbies are not (in certain circumstances) taxable (and so the expenses are not deductible). So while the income remains small it may have been feasible not to declare it ... except for this aspect of Amazon (and Smashwords etc.) withholding tax and making life complicated again. See the recent "BookBaby experiences" thread for discussion there about the fact that BookBaby does not withhold tax or require an ITIN (but they do require that you pay for their services).

11-08-2012, 07:30 AM	#4
avantman42 Wizard Posts: 1,090 Karma: 6058305 Join Date: Sep 2010 Location: UK Device: Kindle Paperwhite	I wrote about how I got my ITIN on my blog: http://russellphillips.wordpress.com...nt-pay-us-tax/ It's a convoluted process, but I didn't have any real problems.

11-08-2012, 11:43 AM	#6
mr ploppy Feral Underclass Posts: 3,622 Karma: 26821535 Join Date: Jan 2010 Location: Yorkshire, tha noz Device: 2nd hand paperback	Just charge extra for the American ones. There's a section on the UK tax form for foreign income that has already been taxed at source. You might need to ask for that page if you are on the short form.

11-09-2012, 05:45 AM	#7
atanner Member Posts: 21 Karma: 1708106 Join Date: Nov 2012 Device: none	Funny but, you can use the Amazon European platform (which would be exactly what I am looking for) for selling EVERYTHING....except.....e-Books??? The ONLY way to sell eBooks right now, is via the .com platform... How is it possible that out of ALL companies, A-M-A-Z-O-N doesn't allow you to sell books for kindle from the UK/Europe???....but you can sell your old shoes, a new paper book, or some face cream!?!?!..... Hopefully they change their policy and have a REAL European platform from which Europeans can sell through, without having to go through hoops...

11-13-2012, 11:52 PM	#9
PainMike the Gusto Gargoyle Posts: 76 Karma: 1375270 Join Date: Oct 2012 Location: Finland Proper Device: Samsung Galaxy A5	If having a tax treaty with U.S; after receiving the ITIN, you type it into W8-BEN form, warranting your foreign status. It is usually sent to the U.S. company you are paid from and should be also found from their pages, from IRS pages at least. W8-BEN is due update every 3rd year if I'm remember correctly.