Contact UsIs a US-based S-Corp expected to withhold taxes from payments for services made to a Canadian freelancer (not an employee), who resides outside of US full time? Additional same question, however replace "freelancer" with "company based in Belize."
Looking at the IRS articles about NRAs and withholding here: www.irs.gov/individuals/international-taxpayers/nra-withholding and here: www.irs.gov/individuals/international-taxpayers/foreign-persons,
which seem to indicate that a US Corp is responsible for withholding taxes from payments on invoices to foreign entities that have no presence in the US, which is counter-intuitive.
which seem to indicate that a US Corp is responsible for withholding taxes from payments on invoices to foreign entities that have no presence in the US, which is counter-intuitive.
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Tax Professional Answers
William Rogers, CFP, MBA, EA
No, you would not be required to withhold taxes to a freelancer who performs their services outside of the US and maintains no permanent establishment in the US. Be sure that the freelancer complete an IRS Form W8 BEN and you keep it on file.
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375 weeks ago