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Can you deduct the US tax paid as a business expense?
by devoutsalsa 6y ago
Can you deduct the US tax paid as a business expense?
- gruez 6y agoIt doesn't matter because your revenue is already reduced, so you can't deduct it again. For instance, if you originally earned $1000/month from youtube with zero expenses, for a profit of $1000/month that you have to pay taxes on. With youtube withholding 30%, your new revenue would be $700/month, for a profit of $700/month. You can't take your new revenue of $700/month, deduct the $300 tax as an expense, for a final profit of $400/month.
- MarkSweep 6y agoIn the USA you can get a credit on your taxes for the amount of foreign tax paid, regardless of whether it was withheld or you paid it after he fact. This can eliminate the double taxation effect. In you example, let’s say you earned $1000 in a foreign country and paid $300 foreign tax. In the US you are taxed on the $1000, let’s say $400, but you can credit the $300 and only pay the incremental $100 of tax. However America taxes world wide income, so it may be different in your country. You should probably ask a tax or accounting expert.