Google Adsense Taxes?

  • SmartOnePotter
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Post 3+ Months Ago

It says that Google Adsense collects tax information, but does that mean I will get a cut of my $100 check taken out? I've done searches but I cant get any straight out yes or no answer. Any help is appreciated!
  • Anonymous
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Post 3+ Months Ago

  • Bigwebmaster
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Post 3+ Months Ago

In some cases yes, and in some cases no. If you are a business Google will likely just send you a 1099-MISC at the end of the year and it will be up to you to pay the taxes. If you aren't a business and are just a individual person who signed up, they will most likely withhold your taxes for you. If you are located outside of the United States, I am not sure what happens.
  • Ganceann
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Post 3+ Months Ago

From what I understand tax isn't taken out by google if you are not associated to any US Company or have no US Tax paying staff (Anyone who provides content for your site and is in receipt of any payment for providing the content), then you wouldn't have tax taken out.

However, that doesn't mean that you would not have to pay tax or be liable to pay tax in your country. It will vary from country to country depending on earnings and tax threshold.

It is highly advisable to set aside the emergency tax rate ( ie in uk emergency tax rate is 25% or so of gross - that is not exact but it is a nice easy amount to set aside).

This means if you have already set the money aside then when the tax man comes knocking, you will have no problem paying... so keep your receipts of deposits - basically you would be treated on a self-employed or contractor tax basis and as such other things may be required as well... especially if you are already working in a job you would then have your money counted as a 2nd income and a different tax rate would be applied to that.

I used to work in a tax environment and there is only one sure thing that will happen... if you dont make provisions for paying your tax and when the taxman catches up to you, then you are left with a lot of headaches.

This can happen even for a small amount as they can impose legal process costs etc so have the money set aside and find out exactly what the tax implications are for your area. Google is not accountable for that - but can provide tax authorities anywhere in the world a complete history of documented payments if required... this would mean paying a fine to the taxman to cover the expense basically :P

Hope that helped you out - I am no longer involved with tax matters at all, although very interesting, it just wasn't what I enjoyed :P
  • WebFreedom
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Post 3+ Months Ago

I don't believe Google will withhold your taxes, regardless of whether you're an individual or a company. I'm registered with AdSense as an individual, and I received a 1099-MISC from Google for tax year 2005. If you receive this form, it means that Google has also submitted this information to the IRS...so you'd better pay up. :wink: I believe that companies paying out to independent contractors (such as Google in this case) are only obligated to file the 1099-MISC form if the contractor in question earned more than $600.00 (US) for the tax year - some companies, however, choose to file this form regardless of the amount paid to the contractor.

HTH,
Sam
  • Bigwebmaster
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Post 3+ Months Ago

Google does in fact withhold taxes for some. I know someone personally who is signed up as an individual and Google withholds their taxes. I am not sure what the criteria is, or if that is just something they started doing later down for new signups that were not companies. Maybe they have other factors they use to determine if they are going to withold taxes, or simply file a 1099-MISC for earnings over $600.
  • WebFreedom
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Post 3+ Months Ago

Bigwebmaster wrote:
Google does in fact withhold taxes for some. I know someone personally who is signed up as an individual and Google withholds their taxes. I am not sure what the criteria is, or if that is just something they started doing later down for new signups that were not companies. Maybe they have other factors they use to determine if they are going to withold taxes, or simply file a 1099-MISC for earnings over $600.


That's very interesting, and not what I would have expected. I'm sure there must be some reason for it, and probably one that's in Google's best interests. :D

Sam

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