taxes for non US affiliates

Icecube

Icecube

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Mar 14, 2007
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I've sent the w8ben form in the past to a couple networks or more, today I've searched a bit and it seems that it's not necessary, but I've found conflicting opinions.

I've read that you are required to fill it only if your revenue is subject to US taxation. I pay the taxes in my own country and I don't have any US based activity ( I just buy hosting and domains ).

Do you send a w8ben form when you join a network? Do you have an ITIN number or just put your foreign tax ID? when are we required to have an ITIN number?
 


Non-US fill out a w-8ben. W9 is for US-Citizens.

Never needed this ITIN #. Never heard of it as well...
I just fill in the basic information and I get paid without any problems.
 
Yes, W-8BEN is the form for non-us affiliates: http://www.irs.gov/pub/irs-pdf/fw8ben.pdf

@Tenso: that's what I have done and I got paid regularly, I just thought I was doing something wrong.


What are we supposed to put in line 8 (which I usually left blank)? Your account ID for each network?
Do you fill line 9a and line 11?

as you can read here IRS tax forms - Wikipedia, the free encyclopedia (last line before W-9) this form seems to be for those subject to tax withholding in the US, so as far as I understand we shouldn't fill it.

That's what this guy Finnish explains here US Taxes Guide for Non-US Affiliate Marketers | Zemalf.com
 
w8ben is for the networks to prove if asked that you are not from US and A. You are responsible for paying taxes in your own country, networks don't give a shit about that, and USA either!

therefore, no need for w9.
 
babylonian said:
w8ben is for the networks to prove if asked that you are not from US and A. You are responsible for paying taxes in your own country, networks don't give a shit about that, and USA either!

therefore, no need for w9.
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This..

Networks just need the form saying you aren't a US citizen and don't need a 1099. Without the w8ben the IRS will assume you are a US citizen and should have been given a 1099, the affiliate network can also be subject to a with holding penalty of 28% of the money paid to you without a 1099/w8ben.

The IRS has also been pushing for disallowing contract expenses > $600 that don't have the proper forms filed for them, meaning the network might end up paying taxes for money that would normally be deductible.

The net net is the network needs the w8ben form to avoid paying a bunch of extra taxes.
 
Icecube said:
Yes, W-8BEN is the form for non-us affiliates: http://www.irs.gov/pub/irs-pdf/fw8ben.pdf

@Tenso: that's what I have done and I got paid regularly, I just thought I was doing something wrong.


What are we supposed to put in line 8 (which I usually left blank)? Your account ID for each network?
Do you fill line 9a and line 11?

as you can read here IRS tax forms - Wikipedia, the free encyclopedia (last line before W-9) this form seems to be for those subject to tax withholding in the US, so as far as I understand we shouldn't fill it.

That's what this guy Finnish explains here US Taxes Guide for Non-US Affiliate Marketers | Zemalf.com
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I don't put anything on line 8... But I do fill line 9-a and 11.
You just have to put your affiliate id in the email you send the Tax Form, so they can update your account and make you eligible to receive payments.
 
dably said:
Networks just need the form saying you aren't a US citizen and don't need a 1099. Without the w8ben the IRS will assume you are a US citizen and should have been given a 1099, the affiliate network can also be subject to a with holding penalty of 28% of the money paid to you without a 1099/w8ben.
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This. If you don't submit the w8ben, don't be surprised if you either don't get paid at all, or get US taxes withheld from your payment under the assumption that you're a US person.

Fill out it & you'll be good - no US tax worries.
 
put there ur country tax id but it doesnt matter at all. its a proof for them that u admit u are not us citizen and dont pay taxes there. nothing more.
 
line 11 ( notional principal contracts ) sounds like we should have a document which proves that we don't run a business in the United States...it doesn't make sense
 
The W8BEN form is only required to be filled out for US SOURCED income. Now "US Sourced" doesn't mean where the person writing the check is, it means where the work was done by the PAYEE.

The OECD (of which the USA is a member of) put it's head together many years ago and determined that if you OWN a webserver in a country, then the websites you have on that server are producing income SOURCED in that country. If you merely RENT a webserver in a country, the websites on it are producing FOREIGN SOURCED income.

FOREIGN SOURCED income is NOT subject to tax in the USA and does NOT require form W8BEN to be filled out - W8BEN is for foreigners to claim exemption from withholding tax on US SOURCED INCOME for tax treaty obligations.

The instructions for W8BEN are clear:

"Who must file: You must give Form W-8BEN to the withholding agent or payer if you are a foreign person and you are the beneficial owner of an amount SUBJECT TO WITHHOLDING."

As I said previously, FOREIGN SOURCED INCOME IS NOT SUBJECT TO WITHHOLDING.

All that is required is that the foreign affiliate CERTIFIES they do not have any US-SOURCED income and are not a US Taxpayer, etc.

Google has it SPOT ON on their Adsense tax information page:

https://www.google.com/adsense/taxinfo

Non U.S. Business (No U.S. Activities )

United States (U.S.) Activities involve having employees or owning equipment in the U.S. that are involved in any way with revenue earned through the AdSense programme. This includes, but is not limited to, owning a web server or owning a hosting service in the U.S., or having employees in the U.S. who are involved in either:

* setting up a web server, hosting service, or website
* developing content for your website
* marketing to create a user base for your site
* telephone support for your site
* buying products for your site
* maintaining your site

Generally, utilizing an unrelated third-party U.S. web hosting service to host your web pages, renting web servers that are located in the U.S. from an unrelated third party, or having your payment sent to a U.S. Post Office Box or mail forwarding address, do not of themselves constitute U.S. Activities.

If you do not have U.S. Activities, you will be asked to agree to a statement to that effect. No tax forms are required in this instance.
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That's it in a nutshell.

IMHO a lot of programs are doing a DISSERVICE to their foreign affiliates by requiring them to fill out forms that are not required, and making these people think they need to put themselves in the US tax system.
 
We've never required our international affiliates to complete the w8-ben form and as McBob said; it's a huge disservice. This is only required if the affiliate earns money with you through their own US assets, which is never the case because everything is virtual. The affiliate confirms that they are not a US citizen when joining.
 
Its clear what nonUS affiliates should do but do you TAX money at home country? How do you make it? Do you need any evidence where the money comes from? Or you just say XX.XXX$ is my net profit and I want to TAX it.
 
I suppose every country has its own system.

Until last year I just gave my numbers to an accountant that I was using for other taxes and what I owed was withold from one of my next paychecks.
I don't run a business, in 2008 I had a job and this is how it worked in that case: now I don't have a job so some stuff will be different.
 
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