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US > Canada: Withholding Tax

I have a few questions for Epic and the community regarding content creators submitting from Canada.

  1. I was wondering if anyone at Epic or on the forums has any Idea how much % is the witholding tax for payments from the US to Canada?

  2. Are any Canadians selling currently on the marketplace and have any information on their sales which could indicate how much they are losing profit to withholding tax?

  3. Are there any other taxes such as local taxes or some tax I don’t even know which will also apply?

I’m very new to this and just trying to prepare & educate myself before making content for the marketplace.
If anyone has any information it would be very appreciated, thanks! :cool:

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I know as a consumer, if it’s $20 on Marketplace I only pay $20 for it, there are no taxes applied (hooray! 14% tax sucks…) :smiley:

But I would also be interested to hear more about how this works for the seller.

The withholding TAX is always the same for everyone max 30%(which means you will have max withhold), unless you can prove you are not from US, and your country have tax treaty signed.

You need ITIN number, to do not have tax withholding.

The good thing is that getting ITIN is now much easier. You just need signed copy of your country personal ID instead of passport signed by your local US embassy.

Once you obtained ITIN you won’t be subject of US tax withholding, but you still will have to pay your local taxes.

thanks for your input @ iniside

Although, now I’m completely confused on what the withholding tax is. Why would Epic write about this:

By country-specific withholding tax don’t they mean from their payment from THEM to YOU? So wouldn’t that be Canadian(or whatever other country) withholding tax? So what does the US withholding tax have to do with this? and How would an ITIN even help since the content creator is not the one paying Epic rather the other way around? Am I even understanding this correctly?

I’m not sure how exactly Epic is dealing with it (would be nice to have some official clarification!), but in general it looks like this:

  1. You actually don’t sell anything per se. You provide content to Epic, and Epic sells it for you.
  2. There of, Epic pays their taxes from the 30% the get from product sales. And the rest (70%) is paid to you.
  3. Now since IRS doesn’t really know from where you are, and what are you doing, they automatically get hold on 30%, from the 70% that you earned. Since you have earned revenue trough US company. Even though you don’t live in US, you have no way to prove that, at this point.
  4. If you don’t have ITIN you get 70% - 30% US withholding tax.
  5. It happens because well, you might actually live in US and pretend to be from Cambodia, to do not pay taxes in US (;.
  6. But if you have ITIN proving that are in fact from other country the withholding tax is returned.

Country specific taxes are taxes you pay in your country from 70% you get. How you deal with that is your problem.

I honestly dunno what that quoted statement means. It might be just bad wording, because for Epic to subject for your country specific taxes, they would have to be registered in this country in first place. I think it is only about US withholding tax.

EDIT ]

Ah ok thanks man

[Edit 2] really well explained seriously thanks :cool:

Really need someone from Epic to come and clarify things

[Edit] Because the business terms seem to state that content creators pay for Epics withholding tax…

Thanks for your question - as a content creator from Canada, you would being contracting with Epic’s International operating branch. In short, there are no withholding tax for payments to Canada, so you would effectively be receiving 70% of your base price for marketplace sales. I hope that helps to clarify.

Actually I would be curious then how it works in case of Poland ? Since Epic have section here.

Would I still need ITIN ?

Thank you very much Joe! it does. :cool: