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Withholding Tax Question

A topic by CleanWaterSoft created 60 days ago Views: 110 Replies: 6
Viewing posts 1 to 4
(2 edits)

I got this information from Steam panel:

"Payments made to you may be subject to US tax withholdings per US tax reporting regulations. Developers may be eligible for a reduced or exempt rate of US tax withholding on units sold to US customers if your country of permanent residence has an income tax treaty with the US. At the end of the interview, you will be notified of the US withholding tax rate, if any, that may apply to you."

This mean that this withholding tax should apply only for sales to U.S.A. customers right?

Yet, I'm selling only on Brazil and when I requested my payout the panel informs that I'll be charged 30% of this tax. =/

I remember that I never got charged for these taxes when selling using the legacy system. What's changed in the meantime?

BTW, is there any way to add BRL as a currency option? If not, why not?

Is this on steam or itch.io? Anything about steam taxes is to be held responsable by you, you got to correctly do it. If you want to only sell in brazil you need to use steam region lock features that will make customers unable to buy your game anywhere but brazil (yes the other regions like mexico, peru, chile, etc will not be able to buy your game).

If this is itch.io you need to fill out paperwork to not get tax withholdings. I am assuming you didn't do this and might need to contact support to redo it.

I'm not working with Steam anymore. I'm selling exclusively on Itch now.

I just asked this because I noticed a difference in how payments where made and this puzzled me. =)

Admin (1 edit) (+1)
This mean that this withholding tax should apply only for sales to U.S.A. customers right?

We've seen this part of Steam's terms. We've consulted with multiple accountants and lawyers about this for our company and they advised that since we are a United States company we have to apply the withholding rate to all income send to you from our bank account.

I don't know what Steam's arrangement is, they may have other entities in other countries to work around this, or they may have interpreted the tax law differently.

Oh I see, they may have a workaround for this maybe?

If I use the legacy payment system, will I need to pay the withholding tax for sales in my own country? I'm expecting to sell more here than anywhere else and also want to keep supporting Itch.io with 30% of my sales, but that additional 30% withholding tax is too heavy for me right now. =(

BTW, any chances of having BRL as currency option soon? This will raise my sales greatly when available.

(1 edit) (+1)

Ok i know what happen, Brazil will not go to an agreement with USA to make a tax treaty. You have to take the 30%.

Yep, that's a big problem. I can just hope for the best (although I'm a bit hopeless =(  ).

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