US tax question...

[thaddeus6th]

I'm hoping this is a simple query that can be answered pretty concisely.

I got a tax information form thingummyjig from the US today, relating to my Amazon sales/royalties. It didn't directly indicate that I need to actually do anything (such as paying tax), but the blurb on the back said that (generally) all individuals and firms that are considered to do business in the US have to fill out a tax return [unless tax withholding covers any taxes they'd have to pay].

Being a British author and selling books via Amazon doesn't count as reason to have to fill out a US tax return, does it?

I'm reasonably confident it doesn't, but would appreciate someone who knows their financial beans confirming this.

 

[Brian G Turner]

So far as I understand it, when in the UK and drawing income from the US, you fill in a W-8BEN form. It basically confirms that you adhere to the tax agreement between the UK and USA, and that you are excluded from paying US taxes because you remain subject to UK juridisction.

Amazon may have this somewhere on the site, or else even have automated this at sign up as it's a bit of a pain and pointless bureaucracy really.

 

[thaddeus6th]

I think that form's about getting rid of the automatic tax withholding (as we have a treaty with the US), which, er, I haven't done yet [I do plan to, at some point].

I don't like getting unexpected tax thingummyjigs from overseas.

 

[thaddeus6th]

What I'm wondering is whether I have to actually do anything/fill out a US tax form?

I don't think I do (already do that as a self-employed UK chap) but I really wasn't expecting anything from Amazon about this.

 

[DrMclony]

What the Australian tax people told me is that you do not have to do anything, rather you fill in the "Forreign income supliment" when doing your Australian tax return, and on that you claim the tax paid in the US as a deduction, in full if less than $1000 and down to the 10% of the tax treaty we have with the US if it is over.

I hope I am remembering that correctly. Last year I phoned the ATO directly while doing the forms and got them to talk me through it. Although we do ours in July so it is a few months back. It is worth checking with your country's taxation department to confirm local rules. The up shot though being I needed to do nothing at all related to US tax in the US. (I think the forms to stop the 30% withholding meant having to do a US tax return, which once done is an annual requirement - not worth the hassle for the small amount earned)

 

[thaddeus6th]

Thanks. Yeah, that's sensible advice, and I'd rather not have to do US tax returns forever.

Grargh. The HMRC (taxman) website is a bit clunky, but I think I've found the relevant bit, although it is written in a manner unsuited to comprehension after just waking up: http://www.hmrc.gov.uk/manuals/dtmanual/DT19911.htm

 

[AMB]

Does the form have a name?

 

[thaddeus6th]

1042-S, I believe.

I've asked somewhere else too, and my current thinking (and fervent hope) is that I'm stressing over nothing, Amazon did the tax withholding [I don't care about that, to be honest] and this form is just a copy for my own records, and that I don't need to do anything.

Edited extra bit: just checked, and that is the form.