AdSense and taxes.

[VessmaN]

Hello fellow webmasters,

I am quite new at being one, only have my website for a month. I installed AdSense with no problem, and now I have to submit my tax information. But right now only my domain name is operated by an American company. Could I just tell Google that I have no affiliated workers/services to my website from the US, so I don't have to pay taxes? Or do they do a complete background check on your website once you submit the information, so they are sure you're telling the truth? Could I get banned for 'cheating'?

It's a hassle to obtain a TIN code, and whatever other info Google needs, and then what percentage of my earnings will be taken for taxes? I couldn't find any information on that in the Help section.

Regards,
VessmaN

[tabish]

if you are outside USA/Canada then it doesnt apply on you.

[PowerUp]

if you are outside USA/Canada then it doesnt apply on you.

I'm living outside USA/Canada. My country has zero tax on foreign income. However, since I am working on these websites from my home, can the Adsense income be classified as a foreign income?

[edited by: PowerUp at 1:56 pm (utc) on Feb. 7, 2007]

[VessmaN]

Are you sure of what you're saying?

This is what I read in the help section.

What information will I need to submit taxes as a foreign individual?

If you're planning to submit taxes as a foreign individual, you'll need to be prepared with the following information:

* U.S. Taxpayer Identification Number (TIN)
* Description of personal services you are providing
* Sufficient facts to justify the exemption from withholding claimed

If you do not have any of the above items, we recommend that you review the description of having U.S. Activities to confirm that you do indeed fall into that category and are submitting the correct IRS form.

And the description of having U.S. Activities is:

United States (US) Activities involve having employees or owning equipment in the US that are involved in any way with revenue earned through the AdSense program. This includes, but is not limited to, owning a web server or owning a hosting service in the US, or having employees in the US who are involved in either:

* setting up a web server, hosting service, or website
* developing content for your website
* marketing to create a user base for your site
* telephone support for your site
* buying products for your site
* maintaining your site

Generally, utilizing an unrelated third-party US web hosting service to host your web pages, renting web servers that are located in the US from an unrelated third party, or having your payment sent to a US Post Office Box or mail forwarding address, do not of themselves constitute US Activities.

Since my dns management is by a US company, doesn't that mean i have associates in US? I am confused. I would really like it if I could just tell them I have nothing connected to America. They don't do thorough checks on your webhost/redirect/etc services, do they?

[jomaxx]

If the only connection is that you're using an American company for web hosting, that does NOT make you American for the purposes of the AdSense agreement.

The only exception might be if you own your server outright, rather than renting it. That is somewhat of a gray area. Personally I would still say that this in itself does NOT make you American for tax purposes, but I wouldn't get into this situation because the IRS may choose to disagree.

[VessmaN]

Thank you for your reply! Now I am confident and satisfied. :)

Looks like a nice place around here, I'll sure be hanging around.

Take care!