30% Foreign Tax on 1042S slip

Tax Topics
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I have a 1042S slip with 30% income tax withheld. The income earned was from YouTube. Is the taxpayer only allowed to claim a 15% foreign tax credit, with the remaining 15% not being allowed as a deduction under 20(11)? Then, the only way to claim the 15% excess is to file a US Federal tax return. Do I have this correct?

TIA

2

The client should fill out the W8-BEN on their ad site…and declare themselves (if they are!) as a non-resident of the US. If they are a Canadian resident, with no permanent establishment in the US, the person is NOT subject to US tax under the treaty. They MAY need to sign the W8-BEN on three different areas on the Google account interface.

First thing is to get Google to stop withholdings.

Then the client needs to get an ITIN from the IRS if they don’t have one and file a 1042-NR …and THEN they should get a full refund of the US tax paid (in $US of course) and then fix whatever mess the Candian T1 is in by that time. I’m in the middle of doing this right now. It’s a considerable pain. However, my client made significant monies and the tax withholding is not a small amount.

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Thanks, SmallBizGuy!