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05.05.2021

Update AdSense so you don’t lose money!

The consequences of the new tax rule for YouTube creators outside the US

Google AdSense YouTube Creator
WRITTEN BY


Marco van Houdt
Client Service Director

marco@team5pm.com

If you’re a creator outside of the U.S. you may begin to have taxes deducted from your U.S. earnings later this year. Google has a responsibility under Chapter 3 of the U.S. Internal Revenue code to collect tax information from all monetizing creators outside of the U.S. and in certain instances, to deduct taxes when these creators earn income from viewers in the U.S.These U.S. earnings can come from ad views. YouTube Premium, Super Chat, Super Stickers and channel memberships.

SO, WHAT DOES THIS MEAN FOR YOU?

Over the next few weeks, you’ll be asked to submit your tax information in AdSense. Here’s what you need to do:

  • In AdSense, go to payments
  • And then manage settings
  • You will see an option to manage your U.S. tax information
  • Through a series of questions, it will determine which tax form you need to submit.

For individuals, this will mainly be the W-8BEN form, while companies will mainly use the W-8BEN-E form. Note: Even if you are paid by an MCN, you must still file your tax information.

Google ad sense

HOW MUCH WILL YOU BE TAXED?

How much you’ll be taxed depends on a few things:

  • If your valid tax form has been submitted
  • How much your channel earns from U.S. viewers 
  • If your country has a tax treaty with the U.S.

Note: The tax withholding rates are 0-30% depending on your country.

WHAT HAPPENS IF YOUR TAX FORM IS NOT SUBMITTED?

If Google does not have tax forms from you by the time these changes go into effect, Google will be required by law to presume you’re a U.S. person. This means until Google has the complete tax info, they need to withhold up to 24% of your total earnings worldwide, not just your U.S. earnings.

DOES YOUR COUNTRY HAVE A TAX TREATY WITH THE U.S.?

Some countries have a tax treaty with the U.S. that can potentially reduce the tax withholding rate on your revenue. So, if you submit your tax info and claim a treaty benefit your tax rate might be reduced. For example, partners in the UK or Canada may be eligible for a rate of 0%, while partners in Mexico or Korea may be eligible for a tax rate of 10%.

5PM NETWORK

The Multi-Channel Network (MCN) of 5PM is one of the few resellers in the Netherlands that offers publishers and brands the opportunity to sell their own YouTube advertising space to advertising partners and thus increase their advertising revenue. For customers that are already connected to the 5PM Network, everything has already been arranged, and for customers that are not connected yet, there is still the possibility to connect and benefit from the advantages that the network offers.

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