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Thread: What are tax regulates for U.S. companies with international affiliates?

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    vectro's Avatar
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    What are tax regulates for U.S. companies with international affiliates?

    Does anyone know what tax forms a U.S. company with international affiliates has to file with the IRS? It's for Internet services, not tangible products. Any other basic info about taxes for international affiliates would be helpful, too.

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    iowadawg's Avatar
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    W8-BEN

    I believe that if the form for the affiliates.

    For you in the USA, same screwed up tax forms.

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    vectro (2 July, 2012)

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    Quote Originally Posted by iowadawg View Post
    W8-BEN

    I believe that if the form for the affiliates.

    For you in the USA, same screwed up tax forms.
    Thanks. If I understand what I've read so far correctly, W8-BEN is for the affiliate to register an account with the IRS. Then international affiliates have to receive a 1099-MISC form just the same as U.S. affiliates do. I'm going to research more just to make sure I'm correct. Eventually I'll ask my H&R Block rep. for info.

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    I was searching through the IRS documentation and I came across their "Tax Law Assistance" service which allows you to ask questions. Someone actually wrote back and said in my situation, the foreign affiliate is not required to register with the IRS or file any forms. This is assuming they are not a U.S. citizen or non-resident Alien abroad. It also assumes the affiliate program does not have a presence in the country where the affiliate is. So, there is no W-8 or 1099 required unless the foreign affiliate has citizenship or a green card or the business has a presence in the country of the affiliate.

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    I (foreign affiliate) get affiliate commission from US companies and didn't need to fill in or mail any forms to the USA. It annoys me to receive US$ payment checks though that need an endorsement and sending to a specialist bank that can handle dollar checks. I like direct deposit through the banking system chaps system or whatever it's called (or PayPal).

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    vectro (10 July, 2012)

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    We have a lot of content providers and editors on the other side of the pond {I'm on the US side}, and so far the ramifications of using anything but PP for payment is a mess. There was an attempt to go to paper checks that was opposed for the reasons Andy said and more. Getting them cashed was in most cases more expensive, complicated and time consuming than using Paypal. Even people that had previously stated their dislike for Paypal wanted to go back to it.

    Not sure about affiliates, but for our non-US citizen contractors overseas there was not yet a form to fill out for reporting purposes.
    -- Do not meddle in the affairs of dragons, for you are crunchy and good with ketchup. --

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    In the past I could not cash a USD check, and threw them in the garbage can. Then I set up a USD Citibank account in the UK, and mailed them the checks, but had some returned when I got the endorsement part wrong.

    I let my ClickBank balance run up to a few 100$ before I noticed that they now offer direct deposit.

    So Google, CB and others are ok now for international payments.

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