Hi guys,
I am a sole proprietorship based in the Netherlands and I want to work with a US-based client. I know by now that I won't be charging any VAT tax, of course, since the US doesn't have this kind of taxation in place. I have signed the W-8BEN form. What interests me more is how is this money going to be treated by the IRS? Will any amount be withheld for the tax purposes? For example, when I buy stuff from California on Etsy, there's some margin of money added for the sake fo the state tax but yeah, it's just California. I do not transport any goods, it's all purely about virtual services (translating).
I do my own accounting (I both like it and absolutely cannot afford international tax advisor's rates with my small company) but this is new to me. I'd be grateful for any information. What worries me most is that it'd turn out I need to have a branch located in the US or some kind of a respresentative there and it's just unrealistic in my case.
