10 ms·

YouTube will start deducting US taxes from creators who don’t live in the US

50 points by nwotnagrom 6y ago

andrewnicolalde 6y ago
This is insanity. It's not just the money taken in taxes, it's the fact that you additionally have to deal with the additional administrative overhead of filling out US tax paperwork, praying you don't get it wrong or paying a US-focused advisor to do it for you.
- JPLeRouzic 6y ago
  I am not sure, at least it is the same on Amazon KDP. There are three situations as summarized in the above link: * Creator doesn’t submit tax info. * Creator submits tax info and claims a treaty benefit. * Creator submits tax info, but is not eligible for a tax treaty. You have to pay your taxes somewhere, if you don't tell Google that you pay them in your country, then Google is in charge to collect the taxes at least for the part concerning US users.
  - tasssko 6y ago
    As an individual yes but i’m not aware of companies having this problem. Does Google treats all its creators as people (i.e income tax) only or does it have the ability to recognise companies? I guess i can close this with the disbelief that content creators setup companies and then use Youtube as themselves. What kind of accounting shenanigans would be required to be a company and content creator on youtube? I am genuinely interested.
davidhbolton 6y ago
It's actually not that difficult. Yes you do not want to make any mistakes ($1000 fines) but there are companies who will sort this out. There are plenty of people, myself included who live outside the US and get paid from US earnings with no tax deductions in the US. It helps of course if your country has a withholding treaty like the UK does with the US.
- mdotk 6y ago
  I believe even with a tax treaty, that Youtube earnings will now be taxed 5% regardless.
donmcronald 6y ago
This feels like a really bad deal for non Americans. From Intuit Canada: > If taxes were deducted from your income, you can claim those taxes as if you paid them to the CRA. Because you have a duty to report all your U.S. income on your Canadian return, the income is deemed taxable as Canadian income. The usually lower U.S. income tax rate could leave you with an amount owing for the difference between the United States and Canadian income tax rates. So Canadians pay (some) income tax to the US instead of Canada and the US gives us nothing in return? It feels like those are systems that were put in place with the assumption that earning income in the US would require the use of US resources (ie: living in the US). That’s just a flat out bad deal for Canada and Canadians, right?
- viraptor 6y ago
  > That’s just a flat out bad deal for Canada and Canadians, right? I'm expecting a thorough discussion and details soon from Linus Tech Tips since they're Canada-based.
- seasoup 6y ago
  “So Canadians pay (some) income tax to the US instead of Canada and the US gives us nothing in return?” Seems like Canadians got the ability to make money on YouTube in return. Seems like a pretty good deal.
  - jwalton 6y ago
    Seems like the US didn’t enforce antitrust laws and allowed YouTube to grow into a monstrous monopoly, because they wanted Internet revenues to all flow into America rather than into a variety of companies, some of which might end up not being American if YouTube was split up. Seems like a pretty bad deal for literally everyone.
    - xiphias2 6y ago
      Why? It makes sense for US citizens. Why would they kill their own golden goose instead of taxing it?
alexbiet 6y ago
That $1.9 trillion stimulus has to come from somewhere.
tibbydudeza 6y ago
So why is it for Youtube content creators ???. If I make money from using AWS and my server is hosted in the US region will I eventually get a taxbill for providing a service to US customers ???.
- jasonv 6y ago
  Youtube pays out to creators.
- skinnymuch 6y ago
  AWS or any host do not pay you. You’re only paying them. YouTube pays people.
pkaye 6y ago
Here the countries with tax treaties with US. https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z https://www.irs.gov/businesses/international-businesses/unit...
- a0-prw 6y ago
  Bizzarely, that list includes the USSR, which no longer exists. The treaty is from 1973.
  - kalleboo 6y ago
    Apparently that treaty is still in effect in any former Soviet country that has not signed a new treaty https://www.irs.gov/publications/p901#en_US_201609_publink1000219361 https://www.irs.gov/publications/p901#en_US_201609_publink10... > U.S.–U.S.S.R. income tax treaty. The U.S.–U.S.S.R. income tax treaty remains in effect for the following members of the Commonwealth of Independent States: Armenia, Azerbaijan, Belarus, Georgia, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, and Uzbekistan. That treaty will remain in effect until new treaties with these individual countries are negotiated and ratified. Provisions of the U.S.–U.S.S.R. income tax treaty are discussed in this publication under Commonwealth of Independent States.
    - a0-prw 6y ago
      Thank you for that :)
jobigoud 6y ago
Is this the same that what Patreon recently changed?
twirlock 6y ago
More reasons it was a good idea to just spread our asscheeks for this borderline-satirical, evil tech monopoly that thinks it's a government. But I'm sure some silicon valley toolshed will be here any moment to deliver a TED Talk about how the wishes of the U.S. intelligentsia are divinely inspired and anyone with questions about overreach is a luddite who doesn't understand ~it's a private company~.
deleted 6y ago
[deleted]
wodenokoto 6y ago
Doesn’t that mean the YouTube creator relationship is an employer-employee relationship? If it was company-contractor relationship, payment wouldn’t be taxable, only the contractors surplus. On top of that. How do creators abroad get a tax refund for their expenses? says the European who has never done business with the US and doesn’t know what he is saying...
Cthulhu_ 6y ago
Weird, my channel gets paid from Ireland, not the US. For all I'm concerned I'm dealing with a European company.
Lio 6y ago
At first this sounds crazy but the article makes it clearer that really they're talking about taxing revenue earned in the US from US viewers. That's not quite so unreasonable as long as it's reciprocated for US creators operating in foreign markets. i.e. you pay taxes where the viewers are, not (only) where the creator is. If you don't submit any tax details they'll go after your full world wide revenue as they don't know where it was earned, so it will be important to do that. I guess it could all be avoided if YouTube added a feature to allow creators from the rest of the world hide content from US viewers but that's probably not part of their business plan.
- ceph_ 6y ago
  You're suggesting that content creators should have to file taxes in every country they have viewers? That's absurd.
  - Lio 6y ago
    You are misrepresenting what I’ve said. You either tax everyone equally or tax no one at all. There shouldn’t be a special case where one government is able to tax foreign nationals for access to their market but no other government is able to reciprocate.

50 points by nwotnagrom 6y ago

This is insanity. It's not just the money taken in taxes, it's the fact that you additionally have to deal with the additional administrative overhead of filling out US tax paperwork, praying you don't get it wrong or paying a US-focused advisor to do it for you.

JPLeRouzic 6y ago
I am not sure, at least it is the same on Amazon KDP. There are three situations as summarized in the above link: * Creator doesn’t submit tax info. * Creator submits tax info and claims a treaty benefit. * Creator submits tax info, but is not eligible for a tax treaty. You have to pay your taxes somewhere, if you don't tell Google that you pay them in your country, then Google is in charge to collect the taxes at least for the part concerning US users.
- tasssko 6y ago
  As an individual yes but i’m not aware of companies having this problem. Does Google treats all its creators as people (i.e income tax) only or does it have the ability to recognise companies? I guess i can close this with the disbelief that content creators setup companies and then use Youtube as themselves. What kind of accounting shenanigans would be required to be a company and content creator on youtube? I am genuinely interested.

davidhbolton 6y ago

It's actually not that difficult. Yes you do not want to make any mistakes ($1000 fines) but there are companies who will sort this out. There are plenty of people, myself included who live outside the US and get paid from US earnings with no tax deductions in the US. It helps of course if your country has a withholding treaty like the UK does with the US.

mdotk 6y ago
I believe even with a tax treaty, that Youtube earnings will now be taxed 5% regardless.

donmcronald 6y ago

This feels like a really bad deal for non Americans. From Intuit Canada: > If taxes were deducted from your income, you can claim those taxes as if you paid them to the CRA. Because you have a duty to report all your U.S. income on your Canadian return, the income is deemed taxable as Canadian income. The usually lower U.S. income tax rate could leave you with an amount owing for the difference between the United States and Canadian income tax rates. So Canadians pay (some) income tax to the US instead of Canada and the US gives us nothing in return? It feels like those are systems that were put in place with the assumption that earning income in the US would require the use of US resources (ie: living in the US). That’s just a flat out bad deal for Canada and Canadians, right?

viraptor 6y ago
> That’s just a flat out bad deal for Canada and Canadians, right? I'm expecting a thorough discussion and details soon from Linus Tech Tips since they're Canada-based.
seasoup 6y ago
“So Canadians pay (some) income tax to the US instead of Canada and the US gives us nothing in return?” Seems like Canadians got the ability to make money on YouTube in return. Seems like a pretty good deal.
- jwalton 6y ago
  Seems like the US didn’t enforce antitrust laws and allowed YouTube to grow into a monstrous monopoly, because they wanted Internet revenues to all flow into America rather than into a variety of companies, some of which might end up not being American if YouTube was split up. Seems like a pretty bad deal for literally everyone.
  - xiphias2 6y ago
    Why? It makes sense for US citizens. Why would they kill their own golden goose instead of taxing it?

alexbiet 6y ago

That $1.9 trillion stimulus has to come from somewhere.

tibbydudeza 6y ago

So why is it for Youtube content creators ???. If I make money from using AWS and my server is hosted in the US region will I eventually get a taxbill for providing a service to US customers ???.

jasonv 6y ago
Youtube pays out to creators.
skinnymuch 6y ago
AWS or any host do not pay you. You’re only paying them. YouTube pays people.

pkaye 6y ago

Here the countries with tax treaties with US. https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z https://www.irs.gov/businesses/international-businesses/unit...

a0-prw 6y ago
Bizzarely, that list includes the USSR, which no longer exists. The treaty is from 1973.
- kalleboo 6y ago
  Apparently that treaty is still in effect in any former Soviet country that has not signed a new treaty https://www.irs.gov/publications/p901#en_US_201609_publink1000219361 https://www.irs.gov/publications/p901#en_US_201609_publink10... > U.S.–U.S.S.R. income tax treaty. The U.S.–U.S.S.R. income tax treaty remains in effect for the following members of the Commonwealth of Independent States: Armenia, Azerbaijan, Belarus, Georgia, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, and Uzbekistan. That treaty will remain in effect until new treaties with these individual countries are negotiated and ratified. Provisions of the U.S.–U.S.S.R. income tax treaty are discussed in this publication under Commonwealth of Independent States.
  - a0-prw 6y ago
    Thank you for that :)

jobigoud 6y ago

Is this the same that what Patreon recently changed?

twirlock 6y ago

More reasons it was a good idea to just spread our asscheeks for this borderline-satirical, evil tech monopoly that thinks it's a government. But I'm sure some silicon valley toolshed will be here any moment to deliver a TED Talk about how the wishes of the U.S. intelligentsia are divinely inspired and anyone with questions about overreach is a luddite who doesn't understand ~it's a private company~.

deleted 6y ago

[deleted]

wodenokoto 6y ago

Doesn’t that mean the YouTube creator relationship is an employer-employee relationship? If it was company-contractor relationship, payment wouldn’t be taxable, only the contractors surplus. On top of that. How do creators abroad get a tax refund for their expenses? says the European who has never done business with the US and doesn’t know what he is saying...

Cthulhu_ 6y ago

Weird, my channel gets paid from Ireland, not the US. For all I'm concerned I'm dealing with a European company.

Lio 6y ago

At first this sounds crazy but the article makes it clearer that really they're talking about taxing revenue earned in the US from US viewers. That's not quite so unreasonable as long as it's reciprocated for US creators operating in foreign markets. i.e. you pay taxes where the viewers are, not (only) where the creator is. If you don't submit any tax details they'll go after your full world wide revenue as they don't know where it was earned, so it will be important to do that. I guess it could all be avoided if YouTube added a feature to allow creators from the rest of the world hide content from US viewers but that's probably not part of their business plan.

ceph_ 6y ago
You're suggesting that content creators should have to file taxes in every country they have viewers? That's absurd.
- Lio 6y ago
  You are misrepresenting what I’ve said. You either tax everyone equally or tax no one at all. There shouldn’t be a special case where one government is able to tax foreign nationals for access to their market but no other government is able to reciprocate.