Amazon tax interview for non-US sellers

What the Amazon tax interview asks

Amazon asks every seller to complete its US tax identity interview, whether or not you pay tax in the US. It’s a guided questionnaire: you give your legal name, whether you’re an individual or a business, your country, your address and your tax number. From your answers, Amazon creates the right IRS form for you.

For non-US sellers, Amazon’s seller help says the purpose is simple: “IRS regulations require non-U.S. taxpayers to provide Form W-8BEN to Amazon in order to be exempt from U.S. tax reporting requirements.” The interview isn’t asking you to become a US taxpayer. It’s recording that you aren’t one.

Registering as a seller from abroad doesn’t need a US number either. Amazon’s registration guide asks for a government-issued ID, proof of address, a chargeable credit card, a bank account and “tax information”, and it lets you receive payouts in a bank account outside the US. Amazon mentions a US bank account as an option, and suggests talking to advisors first because you may need to set up a US business entity for one.

Individual vs business (and US LLC) answers

The first question that matters is who the “beneficial owner” of the income is. That decides the form, and it’s easy to get wrong.

The US LLC rows need care. By default, the IRS disregards a single-member LLC for income tax, so the owner is the one who certifies. The W-8BEN instructions say the owner of a disregarded entity, “rather than the disregarded entity itself, must submit the appropriate Form W-8BEN.” The Form W-9 says the same from the other side: if the owner of a disregarded entity is a foreign person, the owner completes a Form W-8 instead of a W-9, “even if the foreign person has a U.S. TIN.” ITIN vs EIN explains where each number fits.

W-8BEN vs W-9: don’t pick the wrong one

A W-9 certifies that you’re a US person: a US citizen, a green card holder, someone who meets the IRS’s substantial presence test, or a US company or partnership. A W-8BEN certifies that you’re not. The IRS tells foreign persons not to use Form W-9.

If you answer the interview as a US person when you aren’t one, you end up with the wrong certification on file and you’d be treated as a US seller for reporting. Retake the interview rather than leaving it. Amazon says you must also retake it when a change could make your form invalid, for example a new legal name, a move to another country, or a new business tax number.

The reverse also happens. If you’ve lived in the US long enough to be a resident for tax purposes, you’re a US person here even without a green card. In that case the W-9 is correct, and if you can’t get an SSN, the IRS says your ITIN is your tax number. That’s one of the few seller situations where you need an ITIN before you can finish the interview.

TIN fields: foreign TIN, ITIN or EIN

On a W-8BEN, the field that matters for most sellers is the foreign tax identifying number, line 6a: the income tax number your country of residence issued you. Amazon’s guide says to enter it if you have one. If your country doesn’t require you to have one, line 6b lets you say so. The foreign TIN guide covers what counts in different countries.

The US TIN field, line 5, is for an SSN or ITIN you already have. The IRS instructions require it only in narrow cases, and even a treaty claim can use your foreign TIN instead.

Whether you need a tax number at all depends on the kind of income. Amazon’s guide says you don’t need one to establish whether you’re a US or non-US person, but that it can’t reduce “the statutory withholding tax rate (30%)” until you provide one. That 30% rate applies to what the IRS calls FDAP income: royalties, interest, dividends, rents and similar payments. The IRS excludes gains from selling property from FDAP, so for someone selling goods, the treaty rate question usually doesn’t come up. For authors, it does.

Treaty claims for KDP royalties

KDP royalties are FDAP income. KDP says royalties from eBook sales on Amazon.com, and print book sales on Amazon.com, Amazon.co.jp, Amazon.com.au and Amazon.ca, are subject to 30% US withholding. If your country has an income tax treaty with the US, you may qualify for a lower rate by claiming it in the tax interview. The US tax treaty guide explains how rates work.

To claim the treaty rate, you need a tax number:

• If you have a US TIN, KDP says you must provide it.
• If you don’t, you can enter the income tax number your own country issued you.
• If your country has a treaty with the US but doesn’t issue tax numbers, KDP says you may apply for an ITIN by filing Form W-7.

For that last case, you don’t have to file a US return to apply. The Form W-7 instructions include an exception for royalties and similar income, where you send documentation from the payer confirming that an ITIN is needed to pay you. You check box a (treaty benefit) and box h, and name the treaty country and article.

KDP says your W-8 expires on the last day of the third calendar year after the year you signed it. If you let it lapse, the rate goes back to 30%.

When a seller needs an ITIN

For many non-US product sellers, the interview is the end of it. You’ll need an ITIN only in these cases:

• You’re a US resident for tax purposes and can’t get an SSN. You complete a W-9 with your ITIN.
• You sell on KDP, your country has a US tax treaty, and it doesn’t issue tax numbers.
• You have to file a US tax return, such as Form 1040-NR.

The last one is the hard question. The IRS says that “if a foreign person owns and operates a business in the U.S. selling services, products, or merchandise, the foreign person is, with certain exceptions, engaged in a trade or business in the U.S.” Income connected with that business is taxed at graduated rates on Form 1040-NR, and that return needs an ITIN. Whether selling on Amazon from abroad reaches that point depends on the facts of your business and on any tax treaty with your country. It isn’t something the tax interview decides, so ask a tax professional.

Selling on other marketplaces, or through your own site, raises the same questions. ITIN for e-commerce sellers looks at it across platforms.

Validation errors and how to fix them

Amazon’s guide says that if your information is invalid, you’ll be notified by email and prompted to retake the interview. The fixes are usually one of these:

• Name doesn’t match. For a US tax number, Amazon’s tax FAQ says the legal name has to match IRS records exactly. For an ITIN, use your name as it appears on your W-7 and the IRS letter that assigned the number.
• Wrong form. A non-US seller who ended up with a W-9, or an LLC owner whose LLC filed its own W-8BEN-E, needs to retake the interview with the right classification.
• Expired form. Your W-8BEN expires on December 31, three years after you gave it to Amazon. Amazon prompts foreign sellers to retake the interview when it does.
• Something changed. A new legal name, a move to another country or a new business tax number all mean retaking the interview.

If you do need an ITIN, you apply with Form W-7. The IRS says to allow 7 weeks, or 9 to 11 weeks if you apply from outside the US or between January 15 and April 30. How to apply for an ITIN covers the steps.