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Jun 02, 2021 / 17:58

Google withholds taxes from non-US YouTube creators

Vietnamese YouTubers face the risk of being taxed twice as Google’s new tax policy takes effect.

Google has begun withholding US taxes on earnings that non-US content creators in YouTube, including those from Vietnam, generate from viewers in the US.

 Google's new tax policy would have a major impact on YouTubers outside the US. File photo

Under the new policy, YouTube content creators were required to submit their tax information to Google AdSense before May 31, or they would risk being deducted up to 24% of total earnings worldwide for taxes.

In this scenario, if a YouTuber makes US$100 from the platform, he/she would be deducted US$24 from that sum in case they do not submit tax info before the deadline.

Otherwise, Google will only deduct taxes from the income that non-US content creators earn from US viewers. For example, from the US$100 revenue from YouTube, and only US$20 comes from US viewers, taxes will be withheld from that US$20, not the entire sum.

According to Google, the withholding rates are between 0-30% on earnings a YouTuber generates from viewers in the US and depending on whether his or her country has a tax treaty relationship with the US.

“Google has a responsibility under Chapter 3 of the US Internal Revenue Code to collect tax info, withhold taxes, and report to the Internal Revenue Service (the US tax authority, also known as the IRS) when a YouTube Partner Program creator on YouTube earns royalty revenue from viewers in the US,” explained the IT giant on the move.

There is no doubt that Google’s policy would have a major impact on YouTubers outside the US, especially those with a large number of viewers from this country.

In Vietnam, in addition to the 24-30% tax rates from YouTube itself, local content creators are also subject to pay income taxes in their own country.

A recent survey revealed that Vietnam has currently 15,000 monetized YouTube channels. Under the Law on Tax Administration, individuals with income from YouTube will have to pay a 7% tax on their turnover if they earn over VND100 million (US$4,340) per year.