YouTube Will Start Deducting US Taxes from Creators Who Don’t Live in the US

An email going out to YouTube creators who live abroad today notifies of a change to YouTube’s payments. Apparently, Google is now required to deduct taxes for the United States from all channels, even those owned by creators who don’t reside in the United States.

On a support page, Google also clearly outlines an example of this impact.

Example: A Creator in India earns $1,000 in revenue from YouTube in the last month. Of the $1000 in total revenue, their channel generated $100 from U.S. viewers.

Here are some possible withholding scenarios: 

• Creator doesn’t submit tax info: Final deduction is $240 because the withholding tax rate if you don’t submit a form is up to 24% of total earnings. This means that until we have your completed tax info, we’ll need to deduct up to 24% of your total earnings worldwide – not just your U.S. earnings.
• Creator submits tax info and claims a treaty benefit: Final tax deduction is $15. This is because India and the U.S. have a tax treaty relationship that reduces the tax rate to 15% of earnings from viewers in the U.S.
• Creator submits tax info, but is not eligible for a tax treaty: Final tax deduction is $30. This is because the tax rate without a tax treaty is 30% of earnings from viewers in the U.S.

This change won’t affect creators in the United States, but will affect the rest of the world.  YouTube needs updated tax info by the end of May, otherwise a default 24% cut will be made, which, obviously, would be detrimental to many who rely on the platform to make a living.