Here’s why YouTube might be deducting up to 24% of creator earnings

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Google-owned YouTube will start making tax deductions on the earnings of content creators beyond the US from June if they're made from viewers in the united states, the company said.

“They are earnings from viewers in the US through ad views, YouTube premium, super chat, super stickers and channel memberships," Google said in a statement.

The California-based video platform set a May 31 deadline for all creators to submit relevant tax information to ensure that the company can determine the correct amount of tax. Those that don't submit the mandatory information will face a deduction as high as 24 per cent of a creator's global YouTube earnings.

If users provide tax information, the tax withholding rate will be settled between 0 % and 30 % of monthly US earnings, Google said. The withholding rate is determined by if the home country of an individual includes a tax treaty with the US or not.

For example, an Indian creator, who submits tax information and claims a treaty benefit, will go through 15 per cent tax deduction of their earnings from the US viewers. Whereas, for creators not qualified to receive tax treaty benefits, the tax rate would be 30 % of earnings from viewers in the US.

Google said it really is obliged to carry out the tax deduction as it has a responsibility under Chapter 3 of the US Internal Revenue Code to accumulate tax information from all monetising creators outside of the US and withhold taxes using instances when they earn income from viewers in the US.

In the last five years, the business has paid more than $2 billion to creators who've chosen to monetise using Content ID, the company said. There are 9,000 creators using Content ID, including many major network broadcasters, movie studios and record labels.

“For creators beyond the US, we will be updating our conditions of service where your profits from YouTube will be looked at royalties from a US tax perspective … this might impact the way your profits are taxed, and as required by US law, Google will withhold taxes,” it added.

Founded in 2005, YouTube has launched local versions in a lot more than 100 countries and its content comes in over 80 languages. It has nearly 2 billion logged-in users every month, and every day people watch over a billion hours of video and generate billions of views, the business said.

Google in addition has developed an instrument called Content ID that is clearly a digital fingerprinting system used to control the content on YouTube.
Source: https://www.thenationalnews.com

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