Tax witholding - Does it mean I don't have to pay tax in Australia

I have just completed online form that we had to fillup for Tax purpose. I am from Australia and it's in a list of countries that have parternership with USA for Tax purpose.

Not sure what is the purpose of the entire tax form fill up but I have a question.

Does it mean I do not have to pay tax for my Udemy income in Australia?

Thank you

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MariaG

Hey @Ryan

Udemy is based in the United States. All companies based in the US have to comply with IRS (Internal Revenue Service) regulations, which includes collecting information about your tax status as an instructor. Furthermore, no matter where you’re located, you may have enrolled students from the United States, and those transactions may be subject to US tax.
Once you begin the submission flow at taxforms.udemy.com, you’ll see the option to choose whether you are a US or non-US instructor as one of the first selections you make. Depending on what you choose, the platform will guide you through options that are unique to the selection you made as a US or non-US citizen.

You will still be responsible for reporting your income in Australia, (Udemy handles VAT/GST and is withholding for US sales, but you still have to do any tax-related reportings on your own)

Hope this helps. If you have any additional questions, you can reach out to the team at instructorsupport@udemy.com.

Nicola

I am a British Passport holder and Citizen. I live am resident in France and pay tax on all my income including Udemy in France. However As of this year Udemy have started withholding tax. Surely this is not correct, help please. Thanks Nicola

MariaG

Hi @Nicola
,

Udemy is required by the United States IRS to withhold tax when a US student takes a course from a non-US instructor. However, some countries have treaties in place with the US that reduce the rate of withholding on these royalties for their citizens. You can see the IRS's tax treaty table here.

Note that eligible instructors must claim that rate on their tax form in order for Udemy to apply it. If you need to update the form you submitted, you can do so by making a new submission at taxforms.udemy.com.
You can read more about withholding requirements in our Help Center.

Nicola

Thanks I did put that I was a resident in France, but I didn't put in the % I was claiming as part of the treaty.

I looked at the chart and saw that France was on it, but I didn't know I had to fill out the rest of that section ''Special rates and conditions (if applicable—see instructions):'' as I didn't understand it.

Can you help me with this pleas and I will resubmit the form.

Thanks

MariaG

Hi @Nicola

Due to the sensitive and personal nature of tax forms, we can't tell you how to complete the form or exactly what to enter. But we can share some general information about this.

An instructor who is eligible for a treaty rate and wishes to claim it needs to fill out Part II of the W-8BEN ("Claim of Treaty Benefits"), which includes Line 9 and Line 10. All treaty-claiming instructors must complete Line 9 to specify which country's treaty they're eligible under.
However, instructors will only need to complete Line 10 ("Special Rates and Conditions") in less common cases where the type of treaty benefit they're claiming requires them to meet specific conditions beyond the information they've provided on Line 9 (treaty country residency) and Part III (legal certifications).

For example, for royalty income, an instructor would need to complete the Line 10 if their country's treaty specifies different withholding rates for different kinds of royalties; they would use Line 10 to specify which of those rates they were claiming. Since many countries' treaties merely require an individual to be a resident of that country and contain a single rate for all types of royalties, it's uncommon for W-8BEN fillers to use this line.

If you have any concerns about submitting this accurately, we would encourage you to seek the assistance of a tax professional who has experience dealing with the IRS or US tax code matters.