Tax Tips for Non-US YouTube Creators
Social media platforms keep changing and Youtube is also now one of them. Constant updates are required so that the platform does not go out of vogue or become obsolete. With making the community more friendly Youtube has started levying taxes on people who have a Youtube channel. This was already a part of the U.S. based partnership program but now it extends to the whole world.
Non-US Youtube creators will soon have to pay taxes or their revenue can be held by the platform. This is the first time such a tax has been levied. Generally, if you have not submitted your tax info on the Google Adsense account. If you do not file your information a 24% tax will be levied on your earnings.
Here is how you can get started on this.
- Log in to your Google Adsense Account
- Go to the Payments option in the navigation menu
- Click on manage settings
- There will be a U.S. tax info section where you can manage your tax info
Complete the form in that tab and it will lead you to which online form you need to fill. The form is available in multiple languages and can be easily accessed by the account holder.
How much tax do you have to pay?
The amount of tax will vary from person to person and be dependant on mainly three things
- Whether the country you are in has a tax treaty with the U.S.A
- Whether you have submitted all your tax information
- How much of your audience is situated in the U.S.
The tax rate would depend on the kind of treat your country has signed with the States. For example, countries like Korea and Mexico have to pay a 10% tax while the UK has to pay 0% to the United States. Just living in a country that has such a treaty does not make you qualified for the tax benefit. But if you submit all your info that would.
You have till 31st May 2021 to file the relevant information in your Adsense account. This will help Google identify the correct amount of tax on your earnings. If you fail to do so Google will tax you 24% of your earnings from Youtube.
Do I have to pay other taxes?
Yes, this is the amount of taxes that you will have to pay to the U.S. you are still eligible to file your own countries taxes. Get in touch with an income tax lawyer or study online about the taxes in your country. It is important that you file taxes for both the U.S. and your own respective country.
To avoid harsh punishment by your own countries you should take legal advice from qualified professionals. It is also best that you take action on any of your concerns so that they may be resolved before the deadline.
What happens if you do not submit the info?
The default rate on worldwide earnings is 24%, this means you will surrender 24% of your income to Google as per the norm. Depending on the country you are living this can be a lot lesser if you fill in your own information.
If the information is not provided Google will assume that you are a U.S. citizen and tax all your earnings. This would also include your worldwide viewership instead of the U.S. only audience.
What about Youtube creators in the U.S?
According to Google most of the creators in the United States have already submitted all the relevant information beforehand. They were supposed to do this when they joined YOutube’s Partnership Program. No additional taxes will be levied upon these creators. Youtube taxes are a much-needed change that brings these new-age careers under a regulatory body. Since many countries do not recognize a social media career as a standout line of work most of the times the tax laws are vague.
This is Google’s attempt to make positive changes in people’s attitude towards social media stars. Youtube has seen a huge surge in the number of people using their platform and intends to make it a viable career path.
As social media grow influencers and vlogging will be the new in vogue professions. One must think of these professions from a legal standpoint too. For a lot of years, ambiguity has been there as to how will someone on social media pay their taxes. Being an American enterprise Google has taken matters into their own hands and decided to levy taxes.
Such taxes will get these new-age professions under a legal framework and make it easier for everyone in the long run.
What about Multi-Channel Networks?
MCNs are not exempted too. Whether YouTube creators are receiving payout directly from these MCNs or not they will still have to pay. Such creators will also need to file in the relevant information with Google or lose 24% of their earnings.
Youtube has released several country-specific videos which tell you how you can file your tax information. It is easy to follow and tells you exactly how you can file all your tax-related information. Youtube analytics provide an easy way to find out what your earnings are from the US user alone. This will come in handy in future when you actually have to pay the tax.
How can one calculate US earnings?
It is very easy to see your US earnings. Here are few simple steps in which you can view them:
- Go to your Youtube analytics page
- Choose the Advanced mode
- Select a range for the dates
- Then you must click on Geography
- A drop-down menu will appear
- In this menu choose the ‘Your estimated revenue’ option
- Look for the United States specifically
- And voilà you will have all the information that you will need.
Many people have already expressed discontent with this system of double taxation. The creator now is forced to pay two countries until they are in the U.S.A. This puts an additional burden on the creators to perform well even though the algorithm keeps changing constantly.
A lot of people have also objected to this new taxation system as Google already takes a chunk of their revenues. On top of that, the pandemic has made it tough for everyone. Watch times are down and ad revenue has never been lower.
Releasing this policy at this time may not be conducive to creators that operate as a one-man team. But for channels with teams and assistants behind them, this tax rollout adds legitimacy to their jobs. This will also get revenue into the platform and ensure its longevity in the years to come.
As an aspiring Youtuber if you wish to grow we highly recommend filing your information as soon as you start. This way you will be verified beforehand and will not have to surrender 24% of your YouTube earnings. Youtube taxes will become stricter in the future and it is up to you to keep up with such changes.
Double taxation may not look good to people who live outside of the States but in the long run it is better for all. Complying with these laws will ensure a better Youtube experience for you as a creator. These laws are there to protect you and be a part of a community. As the Youtube community grows more laws will have to be introduced so that the video sharing platforms remain risk free and easily accessible for all.
This is a transitioning phase even for the Youtube Hq, And they look forward to it. Google Adsense has enabled many families and individuals to make careers in the fields they love. Travel and fashion influencers have seen the largest boom in recent years and this trend will continue in 2021 too. Due to its reach Youtube is the optimal platform for sharing videos of any length. Whether it be long and informative or short and sweet you will find an audience for all.
File in your information beforehand and avoid a higher tax on your earnings. You should be especially careful with the new laws as they can cause a lot of problems if not taken seriously. Youtube taxes will be levied upon all the YouTube creators and that will make Youtube a self-sustaining ecosystem for budding content creators.
Make sure content is fresh and is in sync with Youtube guidelines. Youtube is making a conscious effort in making its platform safer and child friendly. They are committed to making a family friendly platform that can be enjoyed by all without any hassles. Giving you an immersive experience Youtube has now demonetizing content that may or may not be sensitive in nature. The chances of you finding something that you may dislike is low as the algorithm pushes content that matches your previously watched videos.
Remember to file in your information in your Google Adsense account before the 31st of May 2021 and enjoy a lower tax experience.
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