Smartcat asked me to fill in an IRS form for the US, but I'm a freelance in the UK Thread poster: Marco Cafagno
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I've worked on Smartcat with just 1 client for a couple of years now. Now I just received a notification where Smartcat is asking me to submit an IRS tax form because I've earned more than 600 USD this year. I've earned this amount and more even last year but never got a request to fill this form before. Anyone knows what this is all about?
I'm based in the UK and am not American. Not sure I understand how this works. They keep redir... See more I've worked on Smartcat with just 1 client for a couple of years now. Now I just received a notification where Smartcat is asking me to submit an IRS tax form because I've earned more than 600 USD this year. I've earned this amount and more even last year but never got a request to fill this form before. Anyone knows what this is all about?
I'm based in the UK and am not American. Not sure I understand how this works. They keep redirecting me to the following page:
https://help.smartcat.com/payment-automation/irs-tax-forms-information-for-customers?from_search=117111732/ ▲ Collapse
| | | | Steve Robbie
United Kingdom
Local time: 02:16
Member (2017)
German to English
+ ...
| Send them a W8-BEN form? | May 5, 2023 |
I don't know what Smartcat is or why it sends you US tax forms, but this sentence from the webpage might be your solution:
All translators who are non-U.S. residents or citizens have to upload their W8 forms (W8-BEN or W-8BEN-E) as evidence that they should not be subject to any deductions from their income received via Smartcat. No further action is required from them either.
So if you upload a W8-BEN form, maybe that will solve the problem.
| | | | Samuel Murray 
Netherlands
Local time: 03:16
Member (2006)
English to Afrikaans
+ ...
Steve Robbie wrote:
So if you upload a W8-BEN form, maybe that will solve the problem.
Yes, I think that this is what's happening: you did not upload a W8-BEN file, so now they are required to treat you like someone who is liable for tax in the US. If you fill in that form, and upload it, then their accountants have the documentation that they require to show the US tax authorities that they don't need to get tax from you.
It's not difficult to fill in a W8-BEN form.
If you have difficulty filling in the PDF form (e.g. you use a PDF program that doesn't allow you to fill in PDF forms), you may be able to use a service such as this one: https://www.dochub.com/fillable-form/140-w-8ben (just double-check it against the official form to see if the form on DocHub is the latest version of the form).
| | | | Sascha Chis
Germany
Local time: 03:16
Serbian to Romanian
+ ...
| I got the same "greeting card" | May 5, 2023 |
Actually, if you look at the IRS website, you will see the following:
"Purpose of Form
Establishing status for chapter 3 purposes.
Foreign persons are subject to U.S. tax at a 30% rate on income they receive from U.S. sources that consists of:
Interest (including certain original issue discount (OID));
Dividends;
Rents;
Royalties;
Premiums;
Annuities;
Compensation for, or in expectation of, services performed... See more Actually, if you look at the IRS website, you will see the following:
"Purpose of Form
Establishing status for chapter 3 purposes.
Foreign persons are subject to U.S. tax at a 30% rate on income they receive from U.S. sources that consists of:
Interest (including certain original issue discount (OID));
Dividends;
Rents;
Royalties;
Premiums;
Annuities;
Compensation for, or in expectation of, services performed;
Substitute payments in a securities lending transaction; or
Other fixed or determinable annual or periodical gains, profits, or income.
This tax is imposed on the gross amount paid and is generally collected by withholding under section 1441. A payment is considered to have been made whether it is made directly to the beneficial owner or to another person, such as an intermediary, agent, or partnership, for the benefit of the beneficial owner."
I.e. the form serves to tax you with 30% of your income gained from a US company. What company is that? Well Smartcat Inc., because they fall under US jurisdiction, and you have an agreement with them. If you are a non-US resident, your contracts and payments should have all gone through Smartcat Europe B.V., seated in the Netherlands, thus avoiding the snoopy US IRS altogether. Which would also be right, because you have nothing to do with the Americans. Even according to the "Agreement" that Smartcat is pulling, at the very beginning, it says "Depending on where you reside Smartcat means either Smartcat Platform Inc. a legal entity registered under the laws of the United States of America if you reside in the United States of America or Smartcat Europe B.V. a legal entity registered in the Netherlands with registered address at Rouboslaan 36 B, 2252 TR, Voorschoten, the Netherlands, registration № 859832880 if you reside in any other country." Aka, not american, no dealings with Smartcat Inc., no IRS tax forms.
However, someone at Smartcat appears to have made a blunder and routed incomes (contracts, God knows what) from non-US translators through Smartcat Inc., thus automatically triggering the IRS hounds.
I'm saying it because they sent me one of those greeting cards too a couple of days ago.
So I highly doubt filling out the form will mean getting Smartcat and/or the IRS off your back, I rather suspect it will rather mean saying bye bye to 30% of whatever funds Smartcat routed through their US office. Who, and why, did that, no idea. But the fact is they did it, and now they most likely attempt to pull a fast one and have us pay for their mistake. ▲ Collapse
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I filled it out and forgot about it. Seems just a useless paper for US authorities. It has nothing to do with my actual taxes in my country of residence, and there's no way I will pay them in any other place.
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