UK based company creates and publishes books, some of which are sold in the USA by a major publisher. Previously the UK company has received a cheque once a year for the royalties with no deductions.
Now the director has received a letter from the Us major publishor stating that all royalty payments made to foreign vendors must be made in accordance with IRS regulations. Payments made to foreign vendors will be subject to US federal income tax withholding of 30% unless the appropriate IRS forms have been completed and the payee is exempt (or subject to a lower withholding tax due to a US tax treaty with your country). They go on to request a valid US Taxpayer identification number.
Neither the director or the company has a US tax identification number.
I have discovered that you need to complete form W-7 to obtian a US tax identification number however this realtes to an individual and the royalties are paid to the company.
Anybody have any experiance in these matters?
