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  1. #1
    SitePoint Evangelist
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    Adsense Tax-non usa business but with usa hosting

    I am currently using adsense of my website, however things have started to get very complicated for me.
    Basically googles adsense now requires a tax form to be completed. According to them , even though my business is completly located and operated in the UK because my website is hosted in USA ( florida ) i am required to obtain a Taxpayer Identification Number (TIN).
    I had a look at the directions for obtaining a TIN ( http://www.irs.gov/businesses/small/...=96696,00.html ) and its a complete headache. To be honest i wouldn't know where to begin, i only understand uk tax laws.

    If i did manage to obtain a PIN ( after several weeks of hassle ) what would be the implications of this?
    Does this mean i would have to fill in usa tax forms each year or even pay for the processing of these forms?

    I am seriously considering moving my website to a uk hosting company which is another headache since i am very happy with my current hosting company.

    Does anyone know of a way round this problem?
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  2. #2
    SitePoint Enthusiast EightManagement's Avatar
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    You are correct, the IRS would expect you to at least file payroll taxes (the primary purpose of a TIN, actually know as a Federal Employer Id Number), then they'd want to know how much you made in the States, basically all your internet sales.

    Moving your host out of the US is probably the easiest and cheapest way to go about it. Otherwise, you'll not only be looking at paying US taxes for this year, but also back taxes to when you signed up with your host.

    Let me know if you have any further questions regarding this, I've handled it several times. (eightmanagement@yahoo.com)
    Joshua
    Owner/Accountant
    Eight Management
    Bookkeeping and Taxation Management

  3. #3
    SitePoint Evangelist
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    This is complete madness! My entire website was created and is operating in the uk. Just because i use a usa supplier to host my website they think i should pay usa tax from my uk business?

    I could argue that the adsense code has been created in the uk when it was uploaded and therefore is not of usa origin.

    All this does is force me to move my host to the uk which takes money away from the usa. Moving my host to the uk is not what i want because uk hosting companies tend to be more expensive.

    Why doesnt google just redirect the click throughs to a uk server, then take the charge for the payment from the uk server before redirecting to the advertisers website?
    This way the transaction was handled in the uk.

    The IRS should take a look at this situation as many usa hosts are going to be loosing business.
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  4. #4
    One website at a time mmj's Avatar
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    If you pay a hosting company in the US to host it for you, this doesn't apply. This rule applies only if you host it yourself - that is, part of your business is located in the United States.

    If your host is a separate business to yours, then you don't need to worry about it.

    From the Adsense site:

    A United States (U.S.) business presence involves having employees or equipment in the U.S. that are involved in any way with revenue earned through the AdSense program. This includes, but is not limited to, having a web server or hosting service in the U.S., or having employees in the U.S. who are involved in either:

    1. setting up a web server, hosting service, or website
    2. developing content for your website
    3. marketing to create a user base for your site
    4. telephone support for your site
    5. buying products for your site
    6. maintaining your site

    If you do not have a U.S. business presence, you will be asked to agree to a statement to that effect. No tax forms are required in this instance.
    If the hosting service is not yours, and you pay a separate company to host your site, then you do not have a US business presence.

    Of course, see a lawyer if you're concerned or you're not sure what constitues a US business presence.
    [mmj] My magic jigsaw
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  5. #5
    SitePoint Enthusiast Fizzman's Avatar
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    Quote Originally Posted by mmj
    If the hosting service is not yours, and you pay a separate company to host your site, then you do not have a US business presence.
    Hi mmj,

    I'm having the same problem. Except I'm from Australia. (Where webhosting = EXPENSIVE).

    Would having a dedicated server in the US constitute a US business presence? (My site is running off a dedicated server located in the US).

    Thanks!!

  6. #6
    ********* Genius Mike's Avatar
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    From what mmj said, it seems that you'd have to own the datacentre in which it's located, or be in a co-lo agreement. Since most dedicateds are just rentals, it doesn't appear that this applies.
    Mike
    It's not who I am underneath, but what I do that defines me.

  7. #7
    One website at a time mmj's Avatar
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    Quote Originally Posted by Fizzman
    Hi mmj,

    I'm having the same problem. Except I'm from Australia. (Where webhosting = EXPENSIVE).

    Would having a dedicated server in the US constitute a US business presence? (My site is running off a dedicated server located in the US).

    Thanks!!
    Well,

    You can't ask me legal questions, because I'm not a lawyer.

    If you ask me, the answer is no, since your agreement with your hosting provider and your agreement with adsense have nothing to do with each other - it's a separate business and you don't actually own the server. But, if it's a grey area and you'd really like to be sure you should probably seek someone else's opinion. I recommend you ask google about it. I've always prompt responses when I've asked them adsense-related questions.
    [mmj] My magic jigsaw
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  8. #8
    SitePoint Enthusiast EightManagement's Avatar
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    Hmm, that's different from typical "rules of thumb". Your hosting would consitute your presense in the country, but I guess they rule that as a ghost presense, which wouldn't apply.

    Guess I'm not as up to date as I thought.
    Joshua
    Owner/Accountant
    Eight Management
    Bookkeeping and Taxation Management

  9. #9
    SitePoint Evangelist
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    I will contact google over this, however it would be helpful if any usa lawyer's reading this could clarify if paying for a usa company to host a website would consitute a usa business presence.
    Last edited by TimNiceButDim; Nov 5, 2003 at 10:01.
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  10. #10
    busy Steelsun's Avatar
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    It's also like saying since the website is viewable in the US then there is a US biz presence.

    I think google's off their rocker on this and trying to play it too safe.
    Brian Poirier
    SunStockPhoto: Stock Photos, Fine Art Photos, Event Photography

  11. #11
    SitePoint Evangelist
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    I emailed google about this matter. I was pleased by their quick response. For anyone worried about this, this is what they said.

    Generally, utilizing a third-party United States (U.S.) web hosting
    service to host your web pages, renting web servers that are located in
    the U.S., or having your payment sent to a U.S. Post Office Box or mail
    forwarding address, do not of themselves constitute a U.S. presence.
    However, if you own equipment (such as web servers) located in the United
    States or have employees located in the United States that are involved in
    any way with the revenue earned through your participation in the AdSense
    program, this would be considered a U.S. presence.
    So basically if you rent a server and not own it you are not considered a U.S business presence.

    What a relief!
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