Death and Taxes

Inside iPhone, an O’Reilly blog has a good article on tax avoidance in the new App Store. Tax avoidance is the entirely legal process where you minimise your tax outgoings. Tax evasion is the illegal process where you just don’t pay tax. To cut the story short, Apple will hold up to 30% of what … Continue reading “Death and Taxes”

Inside iPhone, an O’Reilly blog has a good article on tax avoidance in the new App Store. Tax avoidance is the entirely legal process where you minimise your tax outgoings. Tax evasion is the illegal process where you just don’t pay tax.

To cut the story short, Apple will hold up to 30% of what they owe you for tax purposes unless you supply them with a W-8 form which states that you do not need to pay taxes in the US because you pay them elsewhere. Unfortunately, that form requires a valid SSN (the US Social Security Number) which you will not have if you are not a US citizen.

Fortunately, the SSN can be substituted by an EIN (Employer Identification Number) which is used to identify companies as legal entities. If you are a non-US developer, you can request such an EIN from the IRS (the US Internal Revenue Service which is the tax authority).

Click through above to see the instructions. And then talk to an accountant.

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0 thoughts on “Death and Taxes”

  1. These EINs are very normal – if you have any kind of bank account in the US and aren’t a US citizen you need one. The W8-BEN form is pretty easy (if tedious) and the numbers are issued pretty quickly.

  2. Ah, but good to know about them and have the info publicised otherwise you’d be paying tax twice.

    They’re probably ‘normal’ and well known to if you’re physically in the US and are a foreigner.

  3. It’s actually the other way around. If you are a foreigner with an account in the US (e.g. because you have shares in your US-based company) then you will have an EIN. If you are a foreigner in the US then you’ll have a SSN.

  5. Don’t mess this up! Don’t try to illegally evade taxes! Don’t even make a frikkin MISTAKE with this. The IRS can put a lien on what Apple collects of your money. And if that happens, you can be certain Apple will blackball your ass and you’ll never, ever get back into the App Store.

    =============

    Littlefield leaned closer to him. “You’re a young man, you can still learn. Pay attention to this. You can steal in this country, you can rape and murder, you can bribe public officials, you can pollute the morals of the young, you can burn your place of business down for the insurance money, you can do almost anything you want, and if you act with just a little caution and common sense you’ll never even be indicted. But if you don’t pay your income tax, Grofield, you will go to jail.” [The Score by Richard Stark, pg. 73]

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