Taxes and Withholding for Speakers
Foreign Speakers in the USA (Nonresident Aliens)
Honorariums paid to nonresident Speakers performing work in the United States are subject to federal and state tax withholdings, which may be as high as 40% of the Speakers’ total fee. Travel stipends are not exempt from federal withholding; however, they are exempt from state withholding: the exact dollar-amount reimbursements are exempt from both federal and state withholding.
Who is a nonresident?
A nonresident is a Speaker (or their pay-to business entity) who is not a U.S. citizen or national; that is, someone who does not have a U.S. tax ID number. Some nonresidents may be associated with a U.S. business entity in which checks can be made payable-to in lieu of the Speaker. In this case, the speaking fee would be exempt from foreign tax withholding (but may still be subject to state withholdings).
Which tax form(s) should nonresidents complete?
If the Speaker requests payment be made to a nonresident business entity, they must complete Form W-8BEN-E.
Tax withholding rates may be as high as 40% of the Speaker’s total fee, which consists of a 30% federal base, plus state taxes.
Events in California
Honorariums paid to Speakers for events located in California are subject to a 7% withholding tax by the CA Franchise Tax Board. Travel stipends and reimbursements are exempt from this tax.
The speakers bureau will deduct the 7% withholding from Speaker payments and remit the withholding to the State on the Speakers’ behalf. Speakers are responsible for their own taxes.
If the Speaker’s registered pay-to address is in California, then they are exempt from the tax. Alternatively, if they have completed and submitted a valid Form 590 to the speakers bureau, they are exempt.
Events in Canada
Honorariums paid to speakers bureaus, as well as the honorariums speakers bureaus pay to Speakers, for events in Canada are subject to a withholding tax of 15% to 24% depending on the province. Travel stipends are not exempt from this tax; however, exact dollar-amount reimbursements are exempt.
The speakers bureau is obligated to withhold Canadian income tax from nonresidents of Canada who we pay to perform work in Canada. The withholding tax rate is 15% of the Speaker’s total fee, which includes travel stipends (but exact dollar-amount reimbursements are exempt). There is an additional 9% withholding (24% total) for events in the province of Quebec.
Speakers are eligible to obtain a tax waiver if they choose to apply. Alternatively, they may attempt to recoup the withholding by filing a Canadian tax return at the end of the year.
Events in All Other Locations
At the present time, speakers bureaus are not required to track tax obligations for events outside of U.S. and Canada. Speakers performing services in other countries will receive their full net fee as long as the speakers bureau has been paid in full.