Tax and The Stock Photographer

Tax and The Stock Photographer

At some point, as a stock photographer, you may want to start working with a stock library that is outside of your own country.

They will have access to new markets, that you typically won't, and they frequently have relationships with larger clients, such as national newspapers and magazines, thereby encouraging sales of your work in local markets.

These potential sales come at a cost. Namely, tax and paperwork. The issue is as follows: if you are based in country A, but sell stock with a library in country B, then country B will tax your earnings at a much higher rate than if you lived in country B (e.g. a flat 40%). This is called double taxation, and is undertaken by most countries in the world.

There is a light at the end of the tunnel though. It is standard practice for this high tax level to be reduced, or removed completely, if your country has an agreement with the country where the stock library is based (called a Tax Treaty). To avoid this tax you will often be required to prove that you are based in a country that has a favourable tax treaty.

This evidence can take various forms.  For example, if you are in Europe and trading with a stock library in another European country, then your local tax authority can issue you with a Certificate of Residency, proving your home country. This will enable the reduction of taxes.

If only it were this simple for every country. If you start dealing with American stock libraries (or in some cases, sell direct to companies in America) then your evidence of tax status will usually take the form of a W-8BEN (Certificate of Foreign Status form), available from the US Internal Revenue Service. There are various types of W8 form, depending on whether you are a sole trader, partnership, or company.  If you are a business, you will also need a Taxpayer Identification Number (TIN), this has to be quoted on the W8 form, and can be obtained from the IRS by phone (it is a simple process - but expect a long wait, at international phone rates - mine took over an hour of being in a queue).

There are alternatives to this system. Firstly, some US based libraries try to automate the process when you sign up with them, meaning the W8 form is completed as part of that process. Secondly, you may wish to consider signing up with a stock library in your own country that has a distribution network already in place.  That way, they deal with all the taxation laws for each country around the world that they deal with, and simply send you your monthly payment.  Of course, they will take a cut of your sales, before paying you. Ultimately, that decision will depend on how much time you have to process the paperwork - and that in turn is usually dependent on whether you work at stock photography full time or part time.

Of course, this is all based on experience of mine, but I would always recommend you work with a qualified accountant to ensure you are paying the correct amount of taxes.  Phoning your local tax office helpline can also provide you with the answers to any queries.

Equipment used to photograph this stock image:
Nikon 24-70 2.8 lens, a Nikon D800 body, and edited in Adobe Lightroom (boxed) - or Download.