Kindle Publishing and Tax Forms for Non-US Publishers 10


Being an Amazon affiliate is one thing, publishing your own books on Amazon is another, especially if you are not living or working out of the US.  As a non-US publisher, Amazon have to retain 30% of your royalties for the IRS. 

You can read Tax Information for Non-US Publishers on the Amazon site if you like, but I’ll summarize what it says below:

  1. US tax law requires Amazon to report income made by Non-US publishers from royalties on books to the IRS.  They are also required to withhold 30% tax.  You still have to pay taxes in your own country.
  2. If your country has a tax treaty with the US (see page 36-37 of this document for details of treaties) you can submit a W8-BEN form and may then be eligible for a lower rate of tax withholding.
  3. To register as a non-US publisher you need to apply for a tax identification number (TIN) which is written onto the W8-BEN form before you send it to Amazon.
  4. Amazon also mention that you need to complete an SS-4 form. 

 

What I have learned about this process 

Disclaimer: I am not a tax accountant in any country, let alone the US.  This is not tax advice, it’s just personal opinion based on my research.

From reading on Kindle Publishing forums, I have been told that you do not need a TIN which can take weeks to receive.  Instead you can get an Employer Identification Number (EIN) and use that on your W8-BEN instead. 

The good news is that you can get the EIN over the phone.   I got mine yesterday.  I was on hold for around 20 minutes and then once connected to a representative, the process took in less than 10 minutes. 

I got my EIN over the phone, and a physical copy will arrive in 4-6 weeks via mail.

I am now going to fill in my W8-BEN with the EIN and send it off to Amazon.  I’ll update this page on what happens.

If you are a non-US publisher and want to avoid paying 30% tax before even paying tax in your own country, then you need to send Amazon your completed W8-BEN with a TIN or EIN.

Luckily, I found an excellent article on obtaining the EIN.  I just followed that to get mine.  You can read the article “Non.US Self-Publisher?  Tax Issues Don’t Need to be Taxing” by David Gaughran for the process and more details.  I recommend you read all of the comments as well.  One of the comments points out that when the computerized system picks up your call, they ask you to punch in a number depending which department you want.  David’s article says you press number 2, but that has changed.  It’s now number 3.


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10 thoughts on “Kindle Publishing and Tax Forms for Non-US Publishers

    • Andy Williams

      Alex
      I never submitted a W8-BEN to Amazon before WITH an EIN. I’ll have to go back and see if they withheld money. I doubt it. I think the difference is that in one case you are an affiliate, in another, you are displaying your books on “US shelves”.

  • john

    Thanks Andy, very timely for me…
    On Kindle ebook setup this issue did not arise, but yesterday when setting up my ebook for Createspace it did! I’ve only been selling for a week so don’t know if anything is going to be withheld by Amazon yet.

    • Andy Williams

      If you are non-US it will be withheld. Get the forms in now or you might have to wait a long time to reclaim any money that was withheld as they are changing the rules apparently.

  • Victor

    Anyone who wants to get an EIN should take note that it’s meant for authors who have their own company. Here’s an excerpt from David Gaughran’s post:

    “One final caveat: this only applies to self-published authors who are publishing through their own company (and that company must be set up outside the US). While the IRS doesn’t appear to ask for proof that you have actually established your own publishing company, I’m sure there are all sorts of reasons why you shouldn’t commence this process until you actually have.”

    • Victor

      Oh, yeah. And I read this somewhere but I can’t find the source now.

      If the country you reside in doesn’t have a tax treaty with USA, you are better off just letting the US IRS take their 30% cut. Without a tax treaty, you won’t be able to reduce the 30% withholding tax rate. Also, once you get a TIN, you need to file US tax returns for life.

      I’m no US tax expert, so you’ll have to take the points above with a pinch of salt.

      My own researches do show that part about tax treaty reduction being true. Since my residing country currently has no treaty with USA, I’m not bothered with EIN nor TIN at the moment.

  • Rob

    What a load of rubbish(not you. Amazon). I put two books on Kindle and will now be removing them. I wanted to put them on free but I couldn’t.

    It really gets my goat when I have to inform a tax jurisdiction in another country just to put a book online. Roll on the day when individuals like myself can put a book online in a world virtual library for free.

  • Kay

    Amazon have now changed this! Yeah! If you have a National Insurance number (UK) then you can use that. It’s so simple now and this is a really welcome change.