taxes for Google ads + affiliate

Discussion in 'General Business' started by ernest1a, Jan 13, 2008.

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  1. #1
    How is about taxes if you have revenue from Google ads as a company. I am talking about 5.000+ USD per month. And what if you have affiliate partners and they get 20% of google ads incoming. How much taxes do you need to pay in that case, same or % of tax x 100%-20% of incoming?

    I know it is different in every country, please tell me how is in your country.

    Thank you
     
    ernest1a, Jan 13, 2008 IP
  2. Blogspotter

    Blogspotter Notable Member

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    #2
    Whatever you pay to the affilites can be treated as an expense. And this should be fairly similar to all countries..

    A) Say you earn 100 from adsense

    you revenue is 100

    B) Say another 100 from Affiliates

    Affiliate revenue is 100

    C) Total Revenue = 200

    D) Say you pay 20 to your "affiliate partner"

    Your expense is 20

    E) You Net revenue now is 200-20 = 180.

    You pay tax on 180, this is assuming you have no other expense.
    If you have another expense, say 50 for buying traffic, then you oay tax on

    200-20-50= 130

    If Tax rate is 10 % you pay 13 dollars, and your Net Profit becomes 130-13 = 117..
     
    Blogspotter, Jan 13, 2008 IP
  3. soccerfriend

    soccerfriend Well-Known Member

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    #3
    soccerfriend, Jan 14, 2008 IP
  4. castdead

    castdead Active Member

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    #4
    It all depends on where you live, also regarding withholding fees for foreigners. For example: 0% for Belgium, 10% for France etc etc etc
     
    castdead, Jan 14, 2008 IP
  5. john269

    john269 Notable Member

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    #5
    It's simple in my country. You just pay the same as if you had a fulltime job. In other words, you can earn around $8,000 a year tax free. If you earn over that then you will subtract your tax free earnings and then pay 10% on the first $1k or around that much and then 22% on the next $15k or something around that way and then anything that is over you have to pay a large 40% tax on it.

    You only pay taxes on your profits excluding your tax free earnings allowance.
     
    john269, Jan 18, 2008 IP
  6. AstarothSolutions

    AstarothSolutions Peon

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    #6
    In the uk it would depend on if you've formed a limited company or not.... if you havent (and assuming you have other income) you would simply pay 22% or 40% on the profit depending on if you are a higher rate tax payer.

    If you have formed a limited company then the company pays 20% tax on the profit and when you take the money out the company you will have income tax or capital gains tax etc depending on how you take the money out (salary, dividends, dissolving the company etc)
     
    AstarothSolutions, Jan 19, 2008 IP