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K.Bryce
Participant
September 21, 2022
Answered

Taxes for Canadian?

  • September 21, 2022
  • 4 replies
  • 2688 views

Hi, just wondering if anyone in Canada can give me some advice. I'm in Canada and am wondering if or how the tax forms apply to me? Canada is listed as a country that has tax treaties with the U.S... and under the image section it is a 0% for tax withhold on Sale of Images, however I keep reading that if I don't fill out a tax form that Adobe will withhold 30% of the income as taxes... so confused right now. Can anyone explain? thank you

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Correct answer Abambo

I'm not from Canada, but still, the link here https://helpx.adobe.com/stock/contributor/help/Taxes-non-US-citizens.html provides all information you need. It helped me as a non US citizen. You probably need to fill out form W-8 BEN.

 

It's basically a declaration, so that Adobe can justify not to withhold the 30% taxes, but the amount foreseen for your country (0%).

 

But as we all need to pay our taxes: you will have to declare your revenue in Canada. But that's a different story.

 

4 replies

Nancy OShea
Community Expert
Nancy OSheaCommunity Expert
Community Expert
September 21, 2022

Right.  You MUST submit IRS tax withholding forms to Stock in order to get paid. It's not optional. 

 

As a non-U.S. citizen and because Canada & U.S. have trade agreements, you pay 0% withholding.  If Canada & U.S. had no trade agreements, the flat tax rate would be 30% but that doesn't effect you.  Pretty simple stuff, really.  Just fill out the form for non-US resident and submit it from your Contributor portal.

 

If you have questions about your local tax responsibilities, talk to your accountant or tax expert.

 

Hope that helps.

 

Nancy O'Shea— Product User & Community Expert
    R
    Robert McAlpine
    Inspiring
    September 21, 2022

    I am not an accountant and my understanding of the tax situation is as a layman who is a Canadian business owner with a Canadian BN.  As a resident of Canada, you are responsible for keeping track of sales in other countries and including them in your income when you calculate your Canadian Income Tax.  If you have a BN, you do not charge HST/ GST on sales outside Canada; but again, if you are audited for HST/GST (as I was) the auditor will expect you to show them record of your outside the countrty sales; but they will not expect you to have charged HST/GST on these sales. 

     

    You are not liable to pay US taxes on sales in the USA, nor to file US income tax (that is where the treaty between Canada and the USA comes in - you have included these sales in your calculation of your Canadian Income Taxes). 

     

    As I understand it, Adobe is expected to withold a percentage of sales from US residents and these withholdings are deducted from the Income tax American residents pay on their sales through Adobe.  The forms we Canadian are asked to sign by Adobe are to allow Adobe to exempt us from having a percentage of our sales withheld against US Income taxes.  But we Canadians still have to include these sales in our calculation of our Canadian Income tax. 

     

    That is a bit complicated; but it is my layman's understanding of Canadian and US tax laws.     

      Abambo
      Community Expert
      AbamboCommunity Expert
      Community Expert
      September 21, 2022

      Looks like quite the same situation in every country. 🙂

      ABAMBO | Hard- and Software Engineer | Photographer
      Abambo
      Community Expert
      AbamboCommunity ExpertCorrect answer
      Community Expert
      September 21, 2022

      I'm not from Canada, but still, the link here https://helpx.adobe.com/stock/contributor/help/Taxes-non-US-citizens.html provides all information you need. It helped me as a non US citizen. You probably need to fill out form W-8 BEN.

       

      It's basically a declaration, so that Adobe can justify not to withhold the 30% taxes, but the amount foreseen for your country (0%).

       

      But as we all need to pay our taxes: you will have to declare your revenue in Canada. But that's a different story.

       

      ABAMBO | Hard- and Software Engineer | Photographer
        K
        K.BryceAuthor
        Participant
        September 21, 2022

        Ok. Yes i expect there would be taxes on the Canadian side but was confused on what the American side of taxes had to do with me. Thank you! This makes sense now, lol 

        T
        Test Screen Name
        Legend
        September 21, 2022

        I believe it is the form which is the only legal way for you to tell Adobe that you are subject to the Canadian tax system and treaties. Being located in Canada on the day you registered, or having a Canadian address or credit card, isn't legal proof of tax status.

          K
          K.BryceAuthor
          Participant
          September 21, 2022

          Ah, ok that makes sense. Thank you!

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