Royalties Income Classification

[liroyb]

Resident of country A receive ebook royalties from publisher in country B. The resident did not perform any ongoing work after publishing the ebook since all the marketing & customer support is done by the publisher. Considering country A have territorial tax system, such income is classified 'foreign-sourced' from country A prospective?

 

[CyprusLawyer101]

Generally yes. If no sales on e book in the country of residence then more likely nil tax, but local rules shoud be examined. This is rather a generalization of approach though and local rules should be looked at.

 

[liroyb]

Generally yes. If no sales on e book in the country of residence then more likely nil tax, but local rules shoud be examined. This is rather a generalization of approach though and local rules should be looked at.

Thanks for your replay. Yes all the sales are from country B.
Generally speaking, for tax purposes only, does it makes any difference if the royalties receiver incorporate or not?

 

[Cons Mark]

Resident of country A receive ebook royalties from publisher in country B. The resident did not perform any ongoing work after publishing the ebook since all the marketing & customer support is done by the publisher. Considering country A have territorial tax system, such income is classified 'foreign-sourced' from country A prospective?

In general it is foreign source income but for more professional answer it is essential to share jurisdictions, fiscal residency of an actors and their citizenship.

 

[CyprusLawyer101]

Thanks for your replay. Yes all the sales are from country B.
Generally speaking, for tax purposes only, does it makes any difference if the royalties receiver incorporate or not?

Depends on jurisdictions involved