Wednesday, July 18, 2012
Getting paid is part of the job.
If you’re going to write and publish, it’s important that you get paid for your work. Reading the terms of service from Amazon or Smashwords, it all sounds pretty simple. You fill out a couple of forms, or take a 30 % withholding tax cut by the U.S. Internal Revenue Service. You can get a cheque, or you can get EFT. Fair enough.
This morning I picked up the form to get a birth certificate. I had one around here, but I can’t find it. As soon as I started filling the thing out, I realized why I didn’t get it done six months ago. They’re asking $35.00 for a replacement birth certificate, where a first time certificate is only $25.00. For a first time certificate, they don’t have to check previous records, only take the information. So it’s cheaper for them to do.
But they’re also asking questions that I can’t answer. Questions like, ‘What is the name of the doctor who delivered you?’ and I just don’t know. ‘What was your mother’s exact age at date of birth?” and, ‘What was your father’s address at date of birth?’ are questions I can’t answer off the top of my head. You can’t just make it up or try to be close. The reason is very simple: they’re going to find that old birth record, (hence the extra $10.00,) and it had better match up. Otherwise they’re going to send it back to you.
Okay, why is this important? This is about getting paid. I need a birth certificate so that I can get a passport. I need to send the birth certificate and passport to the IRS in order to get an ITIN. I’ve already had stuff sent back by them. That’s an Individual Taxpayer Identification Number. Then I send that form, the W8EN or whatever, to Smashwords, and then they send reports and forms and stuff to the IRS. This means that I can take advantage of the treaty between the U.S. and Canada. Then I don’t get a 30 % deduction at source for U.S. income taxes. The same basic process holds true on any other platform.
And it’s still not as simple as that. When you have books in Amazon, you either make $100.00 in royalties in any given month, and pay a cheque-writing fee, or you don’t get a cheque. My understanding is that all previous unpaid royalties will be paid at once, once this threshold is met. Otherwise it’s held in trust, at no interest paid. Or, you can make the $10.00 monthly threshold for Electronic Funds Transfer, (EFT.) Unfortunately, Amazon does not deal with Paypal, although Smashwords does, and in fact I have gotten royalties (and a 30 % hit,) through Smashwords.
People in the U.K. can get paid, because Amazon U.K. operates there. They have Kindle Direct Publishing. As far as I know, we do not have Amazon Kindle Direct Publishing in Canada. No one really saw this as a problem, because we can publish our books from Canada to the U.S., and through them to other Kindle stores. If you’re not selling a lot of books, or aren’t too worried about taking royalties just yet, no problem. But I would like the money. I need to invest back into the business. The problem lies in getting paid. Even if you’re not selling a lot of books, you need to get paid for your work. So the problem is, first to save the 30 % withholding tax, and then to make either the lower or higher threshold.
In April, I made about $72.00 across a number of platforms from my e-books. In May, it was about $66.00, and in June only about $51.00. Even so, this money would be useful.
Another little snag is in getting a professionally-designed marketing image. I have a Paypal account. In order to put money into it from my Canadian bank account, it looks like I might have to sign up for Interac payments. Yet I would use the account about four times a year or less, and of course there must be some fee or fees involved.
I’ve also heard of something called ‘Access USA’ accounts from CIBC. They have a branch or a partner somewhere in the U.S. and maybe I could get EFT payments into that account, and then transfer the money into Canada. So far I haven’t gotten around to it, and someone told me there might be a monthly fee.
Incidentally, the passport is at least $80.00. But I could just go across the river and open an account if I had one. It’s two kilometres if you’re a good swimmer. (Or, you could just take the bridge.) Then there is the whole series of time delays. It will take so much time to get the birth certificate, so much time for the passport, so much time with the IRS, and so much time with Amazon and Smashwords. Only when I have all this in place, will I get paid at the end of the next quarter or month-end after that. Bear in mind I have books on Lulu and Createspace…etc.
I can’t help thinking that all of this procrastination hasn’t been helping the process along, but it is a process and now I have to call my mother and see if we can figure out exactly how it happened over half a century ago. That whole 'guarantor' thing is bullshit, too. I'm supposed to drag the Mayor or somebody along with me. I'll bet it's a big effing runaround. Blame all those terrorist publishers, they're spoiling it for the rest of us.
As far as purchasing a cover image and paying for it by Paypal, which is what most artists seem to prefer, if I sold a story, and got paid via Paypal, then I would just leave the money in that account rather than transferring it to my Canadian bank. Then I could buy one fricking marketing image. That’s all I want right now. Right? So now, as part of my training as a writer, we get to learn a little bit about international banking, and electronically transferring funds across state and national boundaries, avoiding unnecessary taxes, et cetera.
The flexible system would allow me to withdraw cash while in the U.S. or Canada, transfer money from one country to another, and take royalties every month or quarter from all service providers when I meet the thresholds, either for EFT or paper cheque.
The total cost of setting this up will be something on the order of $150.00 to $200.00 and a certain amount of my precious time. The Mayor will require some buttering up, as I've been pretty hard on the silly old basket in the past. Everything is politics, and all politics is local politics...right?
If I think of it in terms of laying the groundwork for great things to come, then it will all seem worthwhile. Because it’s a necessary and functional part of my dream. Assuming you got a traditional publishing contract, you would still want to get paid, and all of this seems to be relevant to their royalty system as well.