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Amazon Kindle Tax Question

by Tadresources
13 replies
I am a non-US resident and have ebooks on all the different kindle stores (US/AU/UK) etc and was asked to confirm my tax details today when I logged onto the Kindle which I did.

Then I was informed that they would be withholding 30% of my kindle income and that I can only get it back after a refund on my American tax return.

Which to me suggests that you never get it back as I don't file US tax returns as I don't live in the US.

This is the first time I have come across this so wondered if anyone had experienced something similar.

With other US based companies that I work with such as 2checkout, clickbank, Google you just sign a document stating that you are not USA residents. So whats going on with the Kindle and has anyone else had similar?

Amazon.com got in touch when I emailed them and just told me I could get the money back on my US tax return even though I pointed out that I don't file one.

Would love to hear what has happened recently with other WF members that live outside of the US.
#amazon #kindle #question #tax
  • Profile picture of the author tritrain
    There are major changes happening in the US right now, regarding tax laws. Many affiliate marketers in the US are now cutoff from the affiliate program of Amazon and others (only 5 states in the US still have Amazon affiliates). The US sellers currently have to deal with a ridiculous 9,600+ different tax jurisdictions throughout the US. With the new bill, Marketplace Fairness Act, that is now in Congress awaiting approval/disapproval, it is very possible that Amazon sees it being approved and is requiring international sellers to file US tax forms. Our taxes per person are at least 30% of our total income, by the way.

    Apparently, this is now affecting international sellers/affiliates as well.

    I'm curious, would you have to file a US tax form for the international Amazons too?

    Send a message to Amazon customer service and ask about it. Maybe it was just a mistake...?
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    • Profile picture of the author Tadresources
      Originally Posted by tritrain View Post

      There are major changes happening in the US right now, regarding tax laws. Many affiliate marketers in the US are now cutoff from the affiliate program of Amazon and others (only 5 states in the US still have Amazon affiliates). The US sellers currently have to deal with a ridiculous 9,600+ different tax jurisdictions throughout the US. With the new bill, Marketplace Fairness Act, that is now in Congress awaiting approval/disapproval, it is very possible that Amazon sees it being approved and is requiring international sellers to file US tax forms. Our taxes per person are at least 30% of our total income, by the way.

      Apparently, this is now affecting international sellers/affiliates as well.

      I'm curious, would you have to file a US tax form for the international Amazons too?

      Send a message to Amazon customer service and ask about it. Maybe it was just a mistake...?
      This is crazy makes me glad I am not a US tax payer. And all these problems have passed me by. I have a UK niche site that runs on the UK amazon associates so I know very little about what's going on with the american associates.
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  • Profile picture of the author Raydal
    I'm no tax experts but I can't imagine a foreigner being required to pay
    US taxes. This means you'll have to get a SS number or tax ID. I know
    that many foreign banks now have to report the account of US nationals
    over a certain amount for tax purposes as well.

    Presently, if a company has no presence in your state and you make
    an online purchase you don't have to pay state tax, so how could they
    require taxes from someone who doesn't even live in the US?

    I also think this is an error.

    -Ray Edwards
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    • Profile picture of the author tritrain
      Originally Posted by Raydal View Post

      I'm no tax experts but I can't imagine a foreigner being required to pay
      US taxes. This means you'll have to get a SS number or tax ID. I know
      that many foreign banks now have to report the account of US nationals
      over a certain amount for tax purposes as well.

      Presently, if a company has no presence in your state and you make
      an online purchase you don't have to pay state tax, so how could they
      require taxes from someone who doesn't even live in the US?

      I also think this is an error.

      -Ray Edwards
      Actually, it's very possible. All the US needs to do is enact taxes on companies that have a "physical presence" in the US. Amazon cannot escape that (at least for the US-based Amazon).

      For example, the US is the only "1st world" country that forces its citizens to pay taxes whether they live in the US or not. Many expatriates wind up relinquishing their US citizenship so as to not be taxed by the US and their host country.
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      • Profile picture of the author BackLinkiT
        This is entirely normal! You need to apply for an EIN number so go here and do what they say. It worked for me...

        Non-US Self-Publisher? Tax Issues Don’t Need to be Taxing | Catherine, Caffeinated
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        • Profile picture of the author Tadresources
          Originally Posted by BackLinkiT View Post

          This is entirely normal! You need to apply for an EIN number so go here and do what they say. It worked for me...

          Non-US Self-Publisher? Tax Issues Don't Need to be Taxing | Catherine, Caffeinated
          Thanks for the link I have just read it and it makes it sound so easy so I wall give it a go later today!

          Its ashame amazon doesn't have a page like this it would save a lot of hassle.

          And I must admit I was feeling very frustrated so it is nice to see light at the end of the tunnel.
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      • Profile picture of the author Raydal
        Originally Posted by tritrain View Post

        Actually, it's very possible. All the US needs to do is enact taxes on companies that have a "physical presence" in the US. Amazon cannot escape that (at least for the US-based Amazon).
        So then they will be taxing Amazon and treating the affiliate as part of Amazon?

        -Ray Edwards
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        • Profile picture of the author tritrain
          Originally Posted by Raydal View Post

          So then they will be taxing Amazon and treating the affiliate as part of Amazon?

          -Ray Edwards
          Exactly.

          It's known as 'nexus'.

          Affiliates are nothing more than advertisers that only get paid when something sells. Amazon doesn't like it because then it is arguable that Amazon has a presence. They would need to deal with the 9600+ tax jurisdictions.
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      • Profile picture of the author Tadresources
        Originally Posted by tritrain View Post

        Actually, it's very possible. All the US needs to do is enact taxes on companies that have a "physical presence" in the US. Amazon cannot escape that (at least for the US-based Amazon).

        For example, the US is the only "1st world" country that forces its citizens to pay taxes whether they live in the US or not. Many expatriates wind up relinquishing their US citizenship so as to not be taxed by the US and their host country.
        For a non - us resident it just sounds crazy and I am just grateful I don't live in one of the us states that has been affected.
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      • Profile picture of the author HamzaW
        Originally Posted by tritrain View Post

        For example, the US is the only "1st world" country that forces its citizens to pay taxes whether they live in the US or not. Many expatriates wind up relinquishing their US citizenship so as to not be taxed by the US and their host country.
        You'll be pleased to hear that the US is not the only country with this kind of policy. UK citizens must pay tax on their domestic and foreign earnings while living abroad under certain (fairly broad) circumstances. Tax on some earnings (such as uk property rental income) is due no matter where you live and no matter what your circumstances (over a certain income threshold anyway) and by default has to be deducted by your tenant LOL. Yeah, right.

        (Not an accountant, just have an interest for self preservation purposes)
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        • Profile picture of the author JohnMcCabe
          Originally Posted by Raydal View Post

          I'm no tax experts but I can't imagine a foreigner being required to pay
          US taxes. This means you'll have to get a SS number or tax ID. I know
          that many foreign banks now have to report the account of US nationals
          over a certain amount for tax purposes as well.

          Presently, if a company has no presence in your state and you make
          an online purchase you don't have to pay state tax, so how could they
          require taxes from someone who doesn't even live in the US?

          I also think this is an error.

          -Ray Edwards
          Actually, if you earn income in the USA, Uncle Sugar wants his share. Doesn't matter where you live.

          The withholding part is news to me. Most of the foreign companies I've dealt with (I'm in the USA) simply told me that I was responsible for paying taxes or had the payment processor charge (and collect) VAT at the time of purchase.

          If you get an EIN, which is fairly painless, and you stay under certain thresholds (which change every year), getting your money back should be pretty simple. Many people are eligible to file the one-page simple form, named 1040EZ in a fit of uncharacteristic logic.

          You might wwant to spend a few minutes hunting through www.irs.gov for their publications (in pdf) regarding non-citizens reporting and getting tax refunds in the USA.
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    • Profile picture of the author Sandra Martinez
      Originally Posted by Raydal View Post

      I'm no tax experts but I can't imagine a foreigner being required to pay
      US taxes. This means you'll have to get a SS number or tax ID. I know
      that many foreign banks now have to report the account of US nationals
      over a certain amount for tax purposes as well.

      Presently, if a company has no presence in your state and you make
      an online purchase you don't have to pay state tax, so how could they
      require taxes from someone who doesn't even live in the US?

      I also think this is an error.

      -Ray Edwards
      I have a friend who is an Australian author with Kindle books. He jokes about going one day to the White House and asking the President to invite him for lunch, as it is HIS money the one paying the food as well.
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  • Profile picture of the author KenJ
    Originally Posted by Tadresources View Post

    I am a non-US resident and have ebooks on all the different kindle stores (US/AU/UK) etc and was asked to confirm my tax details today when I logged onto the Kindle which I did.

    Then I was informed that they would be withholding 30% of my kindle income and that I can only get it back after a refund on my American tax return.

    Which to me suggests that you never get it back as I don't file US tax returns as I don't live in the US.

    This is the first time I have come across this so wondered if anyone had experienced something similar.

    With other US based companies that I work with such as 2checkout, clickbank, Google you just sign a document stating that you are not USA residents. So whats going on with the Kindle and has anyone else had similar?

    Amazon.com got in touch when I emailed them and just told me I could get the money back on my US tax return even though I pointed out that I don't file one.

    Would love to hear what has happened recently with other WF members that live outside of the US.
    What has changed for you in Queensland is that the W8-BEN form is now in digital format. Kindle will already have been withholding tax from you without them having this form. There is a tax treaty for Australia as listed here. But I couldn't find out what the rules were from the IRS website.

    Before you send the W8 form off you need to phone up the IRS and get an EIN number.

    KenJ
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