EDIT – Since writing this blog entry, I have been informed of a couple of minor changes to the procedure I outline below. I have edited to accommodate these changes, so don’t worry about my information being out of date. Please note, I am not an accountant and am not in any way giving advice. This is simply an account of my own experience, with updates as the procedure has changed. Follow it if you wish.
I am indebted to Paul Teague, a fellow author and podcaster for informing me of these changes. Check out his blog here.
Today started out as just another ordinary day. Y’know like any other? The last hour has turned just another ordinary day into one of those defining moments of your life when something previously unreachable and mysterious suddenly falls into your lap, so opening another door to possiblities.
Okay, get to the point I hear you cry, and I will; I just want to build the atmosphere a bit as befits this momentous occasion.
I’m a UK author and as such, I need a USA tax code if I wish to avoid having 30% of my USA sales income to be deducted by Amazon and Smashwords. There is a procedure for us ‘aliens’ to get this tax code but as anyone who has investigated it will tell you, it’s so complicated and scary it will keep you awake at nights. This is why I’ve avoided even trying up until tonight, when I found out something so completely amazing that I still can’t believe it even now.
The normal way to get the USA tax code, called a TIN, ITIN or EIN is to fill in a complicated form called a W7, which you have to take through a horrendous series of hoops before you get the number allocated to you. This number must then be given to whoever you publish with (Amazon, Smashwords etc) by filling in a form called a W8BEN. Once that is done, you will get 100% of all USA sales income.
The W7 part of this maze is what causes the problems. You have to get it notarised or authorised with the right form of ID etc etc ad nauseam and then you’ll probably have to pay someone to sign a form saying yes, you are who you claim to be. You then have to send it somewhere and wait weeks for your precious number to be allocated to you so that you can then send in your W8BEN.
Well I’ve just got my number without having to fart around with a W7 and the whole process took me around 5 minutes, after which I was issued with an EIN on the spot. I filled in my W8BEN and it sits atop my bookcase ready for posting tomorrow.
How did I circumnavigate the usual hassle? Okay, pin back yer lugholes and make notes.
You first have to ring America and speak to the IRS. The phone number from the UK is 001-267-941-1099. When you get the recorded message, press 1 for English, if that is your language, then press 1 again and wait for someone to answer. When someone answers, tell them you are applying for an EIN as a sole proprietor. If they ask you whether you have filled out an SS-4, tell them you don’t need one as you only need the EIN. They will then ask you for the usual details, name, address etc. They will ask you if you have employees (say no, you are sole proprietor) and they will ask you the date this is from (I said today but you can backdate it I guess). They will ask what your business is (say author) and they will ask if you have a different business address (say no).
They will then issue you with your own EIN right there and then. No W7, no farting about and no fuss, very nicely thank you.
Fill in the W8BEN and send it off to whoever you publish with and wait.
EDIT – I have since heard, although I cannot verify it, that there is now a quicker way even than this. Remember, this was the procedure at the time of writing, which was 2012. If you do find an even quicker and easier way, do let me know and I can further update this blog.
Sit back with a smug grin on your face and treat yourself to that extra choccy bar, jack daniels & coke or whatever your particular treat is.
How can I get ITIN from IRS as non us citizen? Can I get it through phone call or by filling w7 form through someone?
Hi there. Brilliant blog entry, thanks for that. I was wondering that once you get the account up and running, how you fill out the 1042-S US tax return every year. No one seems to mention that much at all, yet Amazon seem to need it and it looks terrifying. I’d just like to know where to go to get help with filling it out- if I need to.
Or am I getting confused?
if i get an EIN can I still be an undividual.
Yes, it’ll just mean you’ll be an employer with no employees.
I just found this article and wanted to say THANK YOU! This is amazing info. I have one question if you can answer it: after you get the EIN and submit it to Amazon, will you then have to pay taxes to the US or just continue to pay taxes in your country?
Thanks again! You saved my life, lol
Sorry it’s taken so long to reply. WordPress locked me out for months. If you send it to Amazon, you won’t pay their standard tax, just your own and if your country has a tax agreement with them, you’ll not pay any tax to amazon.
When you say ‘Amazon’, do you mean the US or a tax agreement specifically with Amazon?
Brilliant! Thank you, thank you! I’ve been dreading that bloody form!
I’ve just rung them up and I now have my EIN- only change is that you now press 1, not 2
Thanks for letting me know about the change, and great news on getting your EIN.
You’re very welcome.
Awesome share, Merita! I am not in UK but Canada and when the time comes, will likely need to do this as well. Thank you!
You’re very welcome Aurora and thanks for visiting xxx
I am not sure why you experienced such problems; i got an EIN through a simple phone call (I called the number on the application); i was able to fill out the W8BEN and submitted it to Amazon/Smashwords; from what I understood, you can choose to fill out a W7 if you want a TIN/ITIN or you could get a EIN which requires only a phone call. I opted for the second option. I wouldn’t be surprised to find out that I am wrong here though – wouldn’t be the first time. However, I did submit everything and so far I’ve had no problems.
This is exactly what I did Marianne and it took me just minutes on the phone.
wow that’s great for you. Being an from the US it was a nightmare convincing Amazon et al that I DON’T need an EIN number because I have a social security number. After several phone calls and letters, they finally listened.