How To Submit Tax Information In AdSense?
In this article, you will learn:
Google is obligated under the Internal Revenue Code to collect tax information, withhold taxes, and report to the IRS when creators under its YouTube Partner Program earn revenue from viewers in the US. This is to help Google identify the correct rate of withholding on your creator earnings.
Accordingly, if you are a monetizing creator on YouTube, you must submit your valid tax information to Google via relevant tax forms in your Google AdSense account. This will not only allow Google to withhold taxes on your YouTube earnings at the applicable tax rates but also enable you to claim tax treaty benefits, which may mean reduced taxes withheld by Google if such a treaty exists between the US and the country of your residence.
However, if you fail to share your tax information with Google within the stipulated time, Google may be required to withhold taxes on your worldwide earnings using the maximum withholding tax rates. In other words, you will end up paying taxes at the maximum rate of up to 30% of your worldwide earnings from YouTube.
You certainly don’t want that. Don’t know how to submit tax information in Adsense? Don’t worry as in this article we will let you know everything, right from which tax form to complete to how to submit tax information in AdSense.
Also Read: Do YouTubers Pay Taxes?
Why Am I Required To Complete A Google AdSense Tax Form Online?
Google is obligated under sections 1441 (Chapter 3) and 3406 of the Internal Revenue Code to collect tax information from all of its creators, irrespective of their location. This is to help Google identify the correct tax withholding rates on payments made to its creators.
Thus, if you don’t want Google to withhold taxes on your worldwide YouTube creator earnings at the maximum tax rates, you must submit accurate tax information to Google within the stipulated time. In case of any changes in contact details, address, etc, don’t forget to update the same in the relevant tax forms applicable to you as a YouTuber if you have already submitted your tax information.
Which Google AdSense Form Are You Required To Complete?
If you haven’t submitted your Google AdSense tax information yet, Google will suggest the tax form applicable to you based on the answers you provide to a list of questions that will be asked to you.
Before we jump to the question of how to submit tax information in AdSense, let’s understand what tax form applies to you.
1. Form W-9
All US-based individuals, partnerships, companies, etc must fill out the W-9 form to submit their tax information to Google.
2. W-8BEN or W-8BEN-E
These are the tax information forms to be filled by the YouTube monetizing creators based outside the US who earn revenue from viewers in the US. Where the W-8BEN form is for the non-US individual creators, W-8BEN-E must be filled out by entities based outside the US. These tax information forms are also used by these creators residing outside the US to claim tax treaty benefits, which may mean a reduced rate of withholding for them.
Check out this video that provides an important update regarding tax information required for all monetizing creators outside of the United States.
This form is to be filled out by foreign individuals or entities who receive income from the conduct of a trade or business in the United States. Accordingly, such persons or entities claim that they are not US-based creators and that the income they receive is effectively associated with a US trade or business. Additionally, all the payees filling out the form W-8ECI will require a US TIN.
This form is for certain partnerships, intermediaries, and flow-through entities outside the US. If you receive this form from Google in your Google AdSense account, Google may require you to provide additional documents.
This form is used by the non-US:
- Central banks of issue
- Tax-exempt organizations
- Private foundation
or the government of a US possession establishing that it is a foreign or non-US entity that receives income from US sources and is eligible for reduced withholding rates.
Also Read: How Do I Get My 1099 From YouTube?
How To Submit YouTube AdSense Tax Form?
As mentioned in the above section, Google provides you with a tax information form that you need to fill out as a monetizing creator to help Google identify the correct tax withholding rates. Your failure to provide valid tax info to Google within the stipulated time will require it to tax your worldwide YouTube earnings on the maximum withholding tax rates of up to 30%.
To submit your YouTube tax form, you must follow the following steps.
How To Submit Tax Information In AdSense?
1. Log Into Your Google AdSense Account
The first step in how to submit tax information in Adsense is to log in to your Adsense account. se your Google ID and password to log into your AdSense account.
2. Go to ‘Payments’
Once you log into your AdSense account, go to the ‘Payments’ section on the left side.
3. Click the Link ‘Manage Tax Info’
The next step in how to submit tax information in Adsense is to click on the ‘Manage Tax Info’. Since you haven’t submitted your tax information yet, you will see ‘No Tax Info on File’ under the ‘US Tax Info’ section.
4. Click ‘Add Tax Info’
You will see an ‘Add Tax Info’ at the bottom. Simply click on it and enter your Google password again to verify its you accessing your Google AdSense account.
5. Answer Questions To Know Your AdSense Tax Form
You will see a list of questions on your screen. The next step in how to submit tax information in Adsense is to answer these questions. This will help Google to find the right tax form based on the answers you provide. Questions relate to the type of account you own such as individual or entity, whether you are a resident of the US or not, etc. Once you answer the questions, Google will suggest the form that you must fill out to provide your tax information. Simply select the form and click ‘Start’ to begin filling out the form applicable to you.
6. Fill Out Your Google AdSense Tax Form
The sixth step in how to submit tax information in Adsense is to start filling out the Google AdSense form to submit your tax information to Google. This information typically relates to your details like your permanent address, TIN, SSN, or foreign TIN, if you are claiming a reduced withholding rate under a tax treaty, etc.
7. Review Your Google AdSense Tax Form
Upon completing your Google AdSense tax form, you will be asked to preview the tax document and see how the information you just provided will appear in the form. Once you have checked for the accuracy of the information provided, simply check on the acknowledgment that says that you have checked the previewed tax documents to the best of your knowledge and confirm that the information provided is correct, true, and complete.
8. Certify the Correctness of Tax Info Provided
The first step in how to submit tax information in Adsense is to certify the correctness of the tax info provided. You will be asked to certify the correctness of the tax info provided and it is you who is the beneficial owner of the income to which this form relates. Simply put in your signature, check that you are the person completing the form, and hit ‘Submit’.
Tax Terminology You Must Know To Fill Google AdSense Tax Form
Here are certain terms you must know to enable you to fill out your Google AdSense tax forms easily.
A. Tax Identification Number (TIN)
Tax Identification Number is the unique identification number allowed by the US tax authority, IRS, to all US-based taxpayers for tax administration purposes. All US taxpayers are required to provide TIN on all statements, returns, and all other tax-related documents.
Accordingly, where the US-based monetizing creators must furnish TIN in their Google AdSense tax forms, all the non-US or foreign creators must provide Individual TIN or a foreign TIN or US TIN if these creators are claiming any tax treaty benefits.
You must seek the advice of tax professionals to determine the Tax Identification numbers that may be accepted as valid by Google in case you are a creator based outside the US.
Some of the tax identification numbers acceptable by Google include:
- United Kingdom – Unique Taxpayer Reference (UTR), National Insurance Number (NINO)
- Japan – Individual Number
- Russia – Taxpayer Personal Identification Number (also called INN)
- Indonesia – Nomor Pokok Wajib Pajak (NPWP)
B. Legal Name
Legal name is your name that reflects in all of your legal documents. You may earn income as
1. An Individual
You must provide your legal name as it appears on all your legal documents if you are earning income as an individual. However, if you have a business that you want to link to this form, you must provide the name of your business in the Doing Business As (DBA) field. Likewise, if your payment profile is under a business name, you must provide your business name in the DBA field.
2. An Entity
If you earn income as an entity, you must put the name of your business entity in the ‘Name’ field. Also, if you have a payment profile under the individual name, you must put that name in the DBA field.
You must note that Google can ask you to provide additional documents to verify your legal name.
C. Doing Business As (DBA) Name
As the name suggests, Doing Business As (DBA) is the name of your company that is different from your legal name as an owner.
D. Disregarded Entity
A Disregarded Entity is a business entity that has a single owner, is not a corporation or a partnership, and has not elected to be treated as an entity separate from its owner for US tax purposes. Accordingly, the income of a Disregarded Entity is reported in the federal return of the owner. The most common type of disregarded entity is a single-member LLC.
Also Read: Should I Start An LLC For YouTube Channel?
E. Payment Methods
There are various types of payments linked to Google products that you are receiving or would receive from Google in the future. For instance, you could receive payments from all or some of the Google Products such as Google AdSense, YouTube Partner Program, or Play Partners. Accordingly, under the ‘Special Rates and Conditions’ under the ‘Tax Treaty’ section, you will be asked to select the payment types that apply to you and for which you are eligible to claim tax treaty benefits.
If you want to know how to submit your tax information to Google in detail, you can check out the Google guidelines to help you with submitting your U.S. tax info in AdSense.