Independent UK authors and the US taxman

by SJ Griffin

Here  follows some  information regarding how you, an independent author based in the UK, can deal with the big bad US taxman and make sure that you don’t end up paying tax twice, once in the US and again in the UK. Imagine how many weapons they could procure with twice as much of our money. It doesn’t bear thinking about.

I’m not sure if the US taxman is big or bad, or indeed a man. To be fair, the man I spoke to as he sat behind the IRS counter at the US Embassy was very nice and helpful in a way that only people who can say ‘have a nice day’ and not sound sarcastic can be.

So, let us begin at the beginning. According to people who will service your ebook distribution needs in the States, like Smashwords, you just need a simple, generic letter to confirm that you are deserving of an ITIN. An Individual Tax Identification Number is a, um, number that the IRS (Inland Revenue Service) use to process tax. It’s like a National Insurance Number in the UK. If you are a non-resident alien, or an independent UK author, you need an ITIN so that you can get US royalties and take advantages of the tax agreement between the US and the UK.  I duly printed out said letter, signed it and took it to the IRS.

An aside: Now, you can post it to the IRS but you need something from a solicitor that confirms that it’s your passport. And you need to send them your passport. Now, I don’t know about you but I am not in the habit of sending my passport off willy-nilly, and certainly not in the post under the auspices of Royal Mail. You can instead take it to the IRS office in the US Embassy, which is great if you live in London. Which everyone does if the Victoria Line at 8am is anything to go by.

We move on. Armed with above-mentioned letter and passport and a W-7 form I presented myself at the US Embassy, which is a strange building. It’s like a film set. I half-expected everything to have no back or insides. When I gave these gifts to the nice man behind the IRS  counter he looked most baleful.

Why so baleful?

You can no longer us a generic letter to prove you need an ITIN. You need a proper letter, signed by a human being holding a pen. Oh, but this is impossible we cry. And this is not what the Smashwords site said we cry. But I knew better than to start crying as I was a nonresident alien on American soil. I too looked baleful and once the competition to see who could look the most baleful had ended (which I lost) the nice man gave me the following advice:

1. Ask for your royalties to be paid with the 30% tax deduction.

2. This will force (FORCE!) the agent of said royalties to send you tax information at the end of the US tax year, or June as it is more commonly known.

3. This will mean you need an ITIN.

4. Shout bingo!

The upshot of all this is that you can claim back the 30% tax while you shout bingo. This nice man said this is much easier than getting an ITIN yourself and proving that you are entitled to the tax back because the onus is on everyone else to straighten the tax out which you have wrongly paid for fear that a diplomatic incident will occur and the UK will suddenly start liking Russia more than America. And also, China. See, a can of worms that is.


There you have it. Sensible advice from a nice man who knows how to look properly baleful. I like this advice, we are using the rules and procedures against the very people who constructed them in order to convenience us and not them. It’s like the LEGO movie. Awesome.

I have not done any of the four steps to tax happiness yet but rest assured I will update you as to how Adventures with the Vanguard and the Big Bad US Taxman proceed. He also gave me a huge booklet about being a non-resident alien full of very useful information that I have not quite read, but if it contains anything that a) I understand or b) find useful I will be sure to let you know.

Have a nice day.

Damn it. That sounded sarcastic, right?