Tax Withholding and Treaty Table for Non-Resident Alien Authors/Publishers Receiving Royalty Income from US Vendors

Tax Withholding and Treaty Table for Non-Resident Alien Authors/Publishers Receiving Royalty Income from US Vendors

Royalties paid to a foreign entity or person are subject to tax withholding in the U.S.  A foreign entity or person is someone who is not a resident or citizen of the U.S. or a green card holder. The general rate of tax withholding is set by U.S. tax rules and regulations and is currently 30% of royalties paid. This withholding tax rate can be reduced if the recipient (you) is a resident in a jurisdiction that has a valid income tax treaty with the U.S.

This reduced rate is only available if the US vendor  receives the appropriate documentation from you. Without this documentation, the 30% withholding tax rate will apply.

To guarantee you qualify to receive the full or partial exemption from tax withholding, you should submit a signed IRS form, W8-BEN, to the US vendor, eg amazon, smashword etc.

The completed form must include a U.S. IRS-issued tax identification number – either an ITIN, SSN or EIN. If you are a U.S. citizen living abroad, you can complete a W-9 form with your SSN

Most authors and publishers don’t have one of the above IRS-issued tax identification numbers. so they must apply for one from the IRS.

When you apply for an ITIN or EIN, the IRS requires you also provide a valid and signed letter from the US vendor, written on the vendor’s letterhead, stating your reason for requesting an ITIN.

If you think you may need an Individual Taxpayer Identification Number, we  can walk you through the process.

To get started with a private consultation, email us today by using this link

UNITED STATES TAX TREATY: AUTHORS AND PUBLISHERS GUIDE ON  ROYALTY INCOME

  • CONTRACTING COUNTRY
  • STATUS
  • ROYALTIES RATE
  • Australia
  • Effective December 1, 1983 ,  Protocol effective July 1, 2003
  • 5%
  • Austria
  • Effective January 1, 1999
  • 0%
  • Bangladesh
  • Effective October 1, 2006
  • 10%
  • Belgium
  • Effective February 1, 2008
  • 0%
  • Bulgaria
  • Effective January 1, 2009
  • 5%
  • Canada
  • Effective October 1, 1984, Protocol effective February 1, 2009
  • 0%
  • China
  • Effective January 1, 1987
  • 10%
  • Cyprus
  • Effective January 1, 1986
  • 0%
  • Czech Republic
  • Effective February 1, 1994
  • 0%
  • Denmark
  • Effective May 1, 2000,  Protocol effective February 1, 2008
  • 0%
  • Egypt
  • Effective February 1, 1982
  • 15%
  • Estonia
  • Effective January 1, 2000
  • 10%
  • Finland
  • Effective February 1, 1991,  Protocol effective February 1, 2008
  • 0%
  • France
  • Effective February 1, 1996, Protocol effective January 1, 2009
  • 0%
  • Greece
  • Effective January 1, 1953
  • 0%
  • Hungary
  • Effective November 1, 1979,  New treaty signed February 4, 2010
  • 0%
  • Iceland
  • Effective January 1, 2009
  • 0%
  • India
  • Effective January 1, 1991
  • 15%
  • Indonesia
  • Effective February 1, 1991,  Protocol effective February 1, 1997
  • 10%
  • Ireland
  • Effective January 1, 1998,  Protocol effective September 1, 2000
  • 0%
  • Israel
  • Effective February 1, 1995,  Protocol effective February 1, 1995
  • 10%
  • Italy
  • Effective February 1, 2010
  • 0%
  • Jamaica
  • Effective February 1, 1982
  • 10%
  • Japan
  • Effective July 1, 2004
  • 0%
  • Kazakhstan
  • Effective February 1, 1997
  • 10%
  • Korea, South
  • Effective December 1, 1979
  • 10%
  • Latvia
  • Effective January 1, 2000
  • 10%
  • Lithuania
  • Effective January 1, 2000
  • 10%
  • Luxembourg
  • Effective January 1, 2001
  • 0%
  • Malta
  • Effective January 1, 2011
  • 10%
  • Mexico
  • Effective January 1, 1994,  Protocol effective September 1, 2003
  • 10%
  • Morocco
  • Effective January 1, 1982
  • 10%
  • Netherlands
  • Effective January 1, 1994,  Protocol effective February 1, 2005
  • 0%
  • New Zealand
  • Effective January 1, 1984,  Protocol effective January 1, 2011
  • 5%
  • Norway
  • Effective January 1, 1971,  Protocol effective June 1, 1982
  • 0%
  • Pakistan
  • Effective January 1, 1959
  • 0%
  • Philippines
  • Effective January 1, 1983
  • 15%
  • Poland
  • Effective January 1, 1974, New treaty signed February 13, 2013 (Not Effective yet: would be 5% once efective)
  • 10%
  • Portugal
  • Effective January 1, 1996
  • 10%
  • Romania
  • Effective January 1, 1974
  • 10%
  • Russia
  • Effective February 1, 1994
  • 0%
  • Slovakia
  • Effective February 1, 1994
  • 0%
  • Slovenia
  • Effective September 1, 2001
  • 5%
  • South Africa
  • Effective January 1, 1998
  • 0%
  • Spain
  • Effective January 1, 1991
  • 5%
  • Sri Lanka
  • Effective September 1, 2004,  Protocol effective September 1, 2004
  • 10%
  • Sweden
  • Effective January 1, 1996,  Protocol effective October 1, 2006
  • 0%
  • Switzerland
  • Effective February 1, 1998
  • 0%
  • Thailand
  • Effective June 1, 1998
  • 5%
  • Trinidad and Tobago
  • Effective January 1, 1970
  • 0%
  • Tunisia
  • Effective January 1, 1991, Protocol effective January 1, 1991
  • 15%
  • Turkey
  • Effective January 1, 1998
  • 10%
  • Ukraine
  • Effective August 1, 2000
  • 10%
  • United Kingdom
  • Effective May 1, 2003
  • 0%
  • Venezuela
  • Effective January 1, 2000
  • 10%

NOTE:This table was last updated May 2015

***Disclaimer: I am a tax accountant and a CPA licensed in Massachusetts , but I am not your accountant or advocate (Unless you have signed up to my services). This communication is not intended as tax advice, and no tax accountant -client relationship results**

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