NewsDio News Desk : YouTube is planning to deduct taxes from those creators who are based outside US, but they make profits from the viewers based in US.
This is the current policy which has been nearly strategized by the US and it all set to be implemented in the month of June 2021.
YouTube has emailed to all the creators in this regards. It has also categorically told the creators to submit the tax form, so that the correct amount of tax to be deducted is known. US based creators don’t have to pay tax in the similar regard.
The parent company Google has sighted the guidelines which are under Chapter 3 of the US Internal revenue Code which makes it mandatory for the tax information to be collected. Likewise, based on the extent of revenue which the creator earned from US based viewers, should be reported to the Internal Revenue Service.
The news obviously gains significance as it informed the creators about the update and very soon creators would be sending the tax related forms back to YT. It seems that YT is very serious as it has said that by May 31st, if the creators failed to provide the tax related information, then in that case, it will be forced to deduct up to 24% of total earnings which they report of.
However, on the other hand, based on the tax information which the creators provide, there will be a withholding of 0-30% on earnings, based on what they earn from the US viewers.
The withholding rates have dependence on the core aspect whether creator’s country has tax treaty relationship with the US or not. Hence, as this aspect is considered, there is going to be variations in the deductions from creators belonging to different countries.
Considering from the aspect of India, the withholding rate is set at 15 percent of the total earnings which the creator earns from UB based viewers.
In order to ease the process for the people, a video is circulated by YT, which explains the details and also assists the creators to fill in the form and provide tax information in a quick and hassle free manner. In order to reach the massive number of people, there is also a tweet by the company where the new rules and guidelines have been prominently told and can be viewed by anyone.
However, the news doesn’t go down well for many creators who have the reason to be angry where they said that the company is already having a cut from the ad they generate. The new policy will affect small creators as they don’t have millions of subscribers whereby they could have attracted native advertisers.
Well, whatever be the case, YouTube will have the effect very soon and creators who are based outside US, have to be furnish the relevant details on time. Failure to which, they may have to experience slightly more cut from the revenue.