TAX hit for NON US citizens earning via create program?

[mspixelicious]

I was under the impression that once you had verified your status with a UTR (unique tax reference) international law would stop the promised 30% reduction in cash payouts!
- I've just completed the process and been hit with a $600 cash payment NOT the $1300 I had available AND requested!
..can SOMEOME PLEASE tell me whats going on and whats what??
do you need to remind imvu staff with every payout of your status or something?
or is this some BS 'expect the tax rebate at a later date'?

[Roy]

It depends on what country you are in. If you research the tax laws for your country and the States, you might be able to file a case. IMVu seems clueless when it comes to people outside of the USA sometimes. I heard a couple cases of IMVU not wanting to accept foreign id's for verification.

[Notorious Chicka]

Hi MsP...

MY suggestion - write a note to DarkAngel5. She seems to be the only person left in there offering real help.

[mspixelicious]

thanks and much hugs youse twose!!

[mspixelicious]

but hung on...quick question comes to mind with roy's comment about IMVU not wanting to accept foreign id's for verification, if they provide the proper and revelant documents, they CANT STOP the verification process!..surely?

[Polystyrene]

Is it possible you didn't fill in your w-8 form in correctly? The UK's tax treaty means that you shouldn't have ANY tax taken out. I'd double check what you sent them and if it is their mistake then don't stop screaming at them till they give you all your money.

[mspixelicious]

FINALLY got some sense and theyve verified my account AND paid me (after i got darkangels help)
...but theyve paid me the 30% deduction amount they automatically set when they asked me on the SECOND occasion to verify
...(they first said i was verified and i could make a cash payment request, but the second i did THAT, someone else decided NO i wasnt verified and i had to get a gov issue id to prove...£103 worth of PASSPORT RENEWAL required!)
...but they logged my cash request AS the 30% deduction one...not the full amount and THATS what theyve paid me!..the 30% reduced!
can i get the FULL amount back and can i make sure this crap doesnt happen again?
and is that LEGIT poly?..as a uk citizen i get NO deduction at all?...trying to fathom these international tax rates is bonkers!

...and I'll tell you this, if it wasnt for THIS place and some ACTUAL answers, I don't know where I'd be right now!...MASSIVE thanks everyone!

[mspixelicious]

is there anyone from the UK earning via create??
...do you have to supply a W­8-BEN form with every cash payment request?

I'm trying to fathom this 'tax reduction/foreign tax treaty' stuff and OMG my BRAIN HURTS!

[Polystyrene]

You only have to supply the W-8 form once, when you verify.

Here is info from the official thread about the earn money program:

If you are a non-U.S. person IMVU will withhold tax from your payouts at the statutory rate of 30% (based the gross payout amount) UNLESS you claim tax treaty benefits between your country of residence and the U.S. To do that,you will have to provide a tax identification number (TIN). If you have a U.S. TIN (ITIN for individuals, EIN for non-individuals), you must provide it. If you do not have a U.S. TIN and the tax authority in your country of residence issues an income tax identification number, you may use it to claim treaty benefits.

You can claim tax treaty benefits by submitting completed W-8BEN form to us.

Non-U.S. persons may be eligible for a reduced rate of U.S. tax withholding if their country of permanent residence has an income tax treaty with the United States. Find the list of tax treaty countries and applicable rates on pages 53 and 55 of IRS Publication 515, in the "Copyrights" column. Please check your form to ensure your rate of withholding tax is consistent with the applicable rates specified on pages 53 and 55 of IRS Publication 515 if you are claiming treaty benefits. If the rate does not match, you may need to review your previous inputs.

To qualify for reduced withholding, you must enter an income tax identification number (TIN) in the W-8BEN. If you are a non-U.S. person and your income is effectively connected with a U.S. trade or business, you must provide a U.S. TIN (ITIN or EIN for individuals; EIN for non-individuals). If you are a non-U.S. person that provides a U.S. TIN, IMVU will submit your tax information to the Internal Revenue Service (IRS) to validate your tax ID information. If you have a U.S. TIN, you must provide this number. If you do not possess a U.S. TIN, you may enter the income tax identification number issued to you by the tax authority in your country of residence. If your country does not issue a TIN used for income tax purposes, you may apply for a U.S. TIN by following the instructions found here: Applying for a U.S. TIN (Taxpayer ID Number).

So I'm guessing that as you didn't provide a TIN to begin with they weren't able to to reduce the tax taken. I'm having trouble finding it but there was a table somewhere that listed what percentage would be taken for various types of earnings from different countries. Our earnings are classed as 'copyrights'' and I'm pretty certain that for the UK it was 5%. So when filling out the W-8 form, under part 2 I think you would fill it in as -
I certify that the beneficial owner is a resident of UNITED KINGDOM
5 % rate of withholding on (specify type of income): COPYRIGHTS
within the meaning of the income tax
treaty between the United States and that country.


For my ID verification I used my old expired passport plus my proof of age card and they were happy with those, so maybe talk to them about other options for ID.

[Polystyrene]

Oh, and you should be able to get that 5% back when you file your tax return. But you might need an accountant to help you with that

[mspixelicious]

DAMMIT Poly!...thats the first and ONLY time I've had anyone guide me through that bloody form properly!
...I sent the form with my first verification request, but I didn't include the tax rate for the UK (didnt know it)...but IMVU verified me, and said I could send a payment request, which i DID (like ASAP)...only then i got the second note saying, "NO, youre NOT verified, so verify with gov issue ID!"
...cost me £103 (of cash i didnt really HAVE) to get my passport renewed!)
...sent THAT in, verification went through, and they paid me HALF of what i had available (only just figured it out myself) they didnt take 30%, its more like 50% but getting answers from these people is neigh on impossible!
...its truly beyond belief how the payment system works like that!

MAMMOTH thanks Poly!

[mspixelicious]

just got a message from darkangel saying the income should be stated as 'royalties'....?

[Polystyrene]

Oh crud, sorry about that! I had Royalties in my head but then the thing in that forum post said Copyrights and I couldn't find my W8 form to check haha.

It's so bloody frustrating that they won't just TELL you what the hell they are doing. Is it possible you hit your MASA cap?

[mspixelicious]

grrrr..yah MINX!...sent changed form to imvu (im hoping they include it with next payments...but they LOVE the delay system, AND the daze and confuse approach to things)
this timezone difference is soooooooooooo ...heh...its like 24 hours before the ANSWER arrives!..sighhhh..but getting there me thinks

[mspixelicious]

can't help but think it would be in IMVU's best interests to HELP people!..its one thing (might be legally binding, i dont know) as to the reasons WHY they cant or wont help with tax details, but my god, do they honestly expect everyone to function as a fully paid accountant/solicitor???
...draw PICTURES for fick sake!
and now for every transaction I'm trying to do, it comes with a SHEDLOAD of help ticket requests, help demands, enquiries...when all of it could be avoided with just a LITTLE HELP!

[mspixelicious]

just received some info from darkangel that if you supply an ITIN (the US tax number)..its NO tax reduction...but she didnt mention anything about what happens if you ONLY supply the UK tax number
...Oh and I asked on my group if anyone else from the UK was earning and so far not a SINGLE COMMENT!
...just how many people are EARNING with this thing?
...still working on this!

[Polystyrene]

I don't know about an ITIN, but I know that if you don't supply your tax details they will take the full 30%. To get the tax treaty reduction you must provide your tax identification number on the W-8 form. That's what I did and I think what everyone I've spoken to about it has. I have a couple of UK friends who earn money and as far as I know they didn't have any issues.

I don't think IMVU really cares about helping people, they just want to do the bare minimum. You probably should talk to an accountant if you are earning money this way anyway though lol.

[Polystyrene]

OH I AM DUMB!

5% is the rate for Australia, I think UK is 0%

Sorry

My brain does not work these days.

This is why you go to an accountant

[mspixelicious]

im trying like mad to find someone from the uk to verify, but theres NO ONE!...is that a definite hun??..the uk's rate is 0%

[mspixelicious]

right..tis official..im am TOTALLY baffled by this now...found this on withholding tax rates per country http://taxsummaries.pwc.com/ID/Withhold ... WHT)-rates ...and as far as i can tell, the UK for royalties is 20% whilst australias is 0%...????

[Polystyrene]

I know there was a table with the amounts listed somewhere in all those IRS forms but I can't for the life of me find it. I found stuff on the IRS site talking about it but can't find the bloody thing.

EDIT: FOUND IT!!!!

https://www.irs.gov/pub/irs-utl/Tax_Treaty_Table_1.pdf

On page 4, 'Copyrights' within the 'Royalties' section. UK 0%!

[mspixelicious]

oh you GAWJUSNESS!..mwaHHHHHHHHHH..hugs a GOO GOO hunbun!...THAT little piece of info is the KEY to everything, but soo FICKING hard to FIND!

[mspixelicious]

sighhhhhhhhhhhhhh....do they apply the same MASA limit for TWO accounts if you have them linked to the same tax number??
...barely getting passed the crap they dealt out from day one and POW!...straight into a masa limit!...RIGHT after I had sent the FINAL and CORRECT W-8BEN form WITH the CORRECT tax reduction number of 0%!
...the hell kinda way of doing business is this???

[mspixelicious]

so can i just ASK THIS to make sure..?...just SAY THIS, to get this load off my mind?

we're dealing with a system that takes TWO WEEKS to delay payment with the 'PENDING CREDITs' scheme...
has a system that demands YOU make a 'payment request' to START cash payments...
can take 'X' amount of days to have THAT request VERIFIED.....
and then FIVE WORKING DAYS for payment to actually GO THROUGH...
and ALL of this with a system so vague, so obscure, so HIDDEN, so difficult to discuss or translate or expand or deliberate...simply..
FILE a TICKET and GET IN LINE!.....
so thats IT is it>??...thats the 'CASH EARNING' scheme via IMVU??

[Polystyrene]

Yep, that's it! Oh and don't forget the part where we lost two weeks' income because we had to wait for the pend to start over again. That was SUPER FUN.

I feel like when things are going smoothly the system works pretty well. But the moment something out of the ordinary happens, you're farked.