Author Topic: Withholding Tax (Read 19666 times)

heywoody · « **Reply #25 on:** June 11, 2015, 05:26 »

Quote from: bunhill on June 11, 2015, 05:12

Quote from: heywoody on June 10, 2015, 18:43
A well designed IT system would accommodate this situation automatically either by holding payments pending completion of the tax form or by auto adjusting balances.

Not necessarily. Systems are defined by the rules which they implement (using rules here in the systems-analytical sense). Unless you know those rules you are not in a position to judge whether a system is well designed or not. The rules of this system are likely constrained by two potentially overlapping sets of requirements - i.e. IRS process / regulation and the contractual obligation to pay.

{Also _ This is just like -> if you were to overpay on the PAYE system in Ireland (or the UK) you would have to claim it back from the government. Not from the employer.}

Wrong on both points:

1. The "rules" in a properly designed IT solution would have accommodated this as it is a blindingly obvious scenario - I seriously doubt there was any actual systems analysis performed here just an instruction to hack whatever dodgy code they had already. I would be hugely embarrassed if I missed something like that in one of my specs.

2. In Ireland, overpayments of PAYE are refunded by the employer where new information is notified within the current tax year - one only has to contact revenue in the case over overpayments due for previous years.

Micky_Mango · « **Reply #26 on:** June 11, 2015, 05:41 »

Quote from: heywoody on June 10, 2015, 18:43

Quote from: Micky_Mango on June 10, 2015, 03:53
Quote from: heywoody on June 09, 2015, 17:16
Quote from: Micky_Mango on June 09, 2015, 00:50
Although IS have been woefully ill prepared for changes in the past it is hard to fault how they handled the new payment and tax changes, with months of emails and forum posts explaining the upcoming changes. To call them incompetent on this issue is a bit unfair, and to take no responsibility yourself is a bit rich IMHO. Did you not read any of the information or emails regarding the changes? They were made very clear, and it's hard to see what more they could have done. Sometimes we have to take a bit of responsibility ourselves. On top of this, the amounts you are talking about must be very small, you have 300 sales at IS in 6 years so not a great deal in terms of money. You are also presumably aware that if your income is taxed once ( ie. you are taxed in US on your income from US) you won't be taxed on it again in the UK? This is sounding like a very small storm in a teacup.
I have said earlier that failing to do the tax interview was on me (taking responsibility). Also true that we are talking about a trivial sum of money. However, in principle, the mechanics of the situation are that money is moved from the contributor to a pot of money for revenue which is paid out at various points in time but will always have some funds there. Where a deduction should not have made (for whatever reason) it should be a simple matter to debit one account and credit the other - this is how companies (even American ones as I happen to be employed by one) operate. So, notwithstanding my error, I stand over my statement that there is a lack of competence and imagination involved by IS. This is the very same IS who feels that its FAQ takes precedence over the contract it enters into with its contributors.
IS have many tens of thousands of contributors, do you really expect them to start making individual adjustments to the many thousands who doubtless failed to take any notice of the many weeks of reminders of forum posts and emails, to pay back tiny amounts of money to people who couldn't be bothered to keep an eye on their own businesses? As I said before, there is a principle in taxation that you are only taxed once on income, so any tax IS have deducted won't be a million miles from what you would have paid in your own country, where you won't have to pay tax a second time on the already taxed income, so really, you are using a tiny tiny stick to beat IS when the fault lies with you anyway. How much are we talking about? A few dollars? I'm the first in line to criticise IS when the deserve it, but in this case the lack of competence and imagination is down to you buddy. Perhaps you should also read Difydave's post too, where he states "The IRS then gives iStock permission to pay you the full amount without the witholding tax being taken.
iStock can't just pay the full amount to you without permission from the IRS or they would become liable for the tax money. "

Here's the thing, "buddy". A well designed IT system would accommodate this situation automatically either by holding payments pending completion of the tax form or by auto adjusting balances. Not everyone lives on their forum or waits with bated breath to read the next bit of spam they issue in case it has something significant to say.

Look bud, you need to find a less stressful hobby if you're getting so worked up over a couple of dollars.

Semmick Photo · « **Reply #27 on:** June 11, 2015, 05:54 »

Quote from: bunhill on June 11, 2015, 05:12

{Also _ This is just like -> if you were to overpay on the PAYE system in Ireland (or the UK) you would have to claim it back from the government. Not from the employer.}

Actually no, I have overpaid PAYE in my first month at my new employer and by issuing my P45 to HR, I will get a correction my PAYE charges on my next paycheck from my employer.

heywoody · « **Reply #28 on:** June 11, 2015, 06:03 »

Quote from: Micky_Mango on June 11, 2015, 05:41

Look bud, you need to find a less stressful hobby if you're getting so worked up over a couple of dollars.

The conversation has nothing to do with the few dollars - explanation given ages ago and accepted. The conversation is about the IS fan boys saying the company handled this in and effective and professional manner and I'm simply pointing out that your standards in this regard are very low.

ShadySue · « **Reply #29 on:** June 11, 2015, 12:28 »

In an earlier post you complained about lack of communication from iS. Then you admitted you don't read their forums or email. Apart from Lobo visiting you personally and hitting you with his hammer, what else did you expect?
Why not just chalk this up to your mistake and move on?
One doesn't have to be a fanperson to see that iS is not really at fault here.
FWIW way back in the day I claimed a payout and stupidly put the wrong email addy for Paypal and of course the payment was rejected. I put it down as a lesson in user idiocy, but around a year later CR contacted me out of the blue and I got the payment.

heywoody · « **Reply #30 on:** June 11, 2015, 16:45 »

My point about communication is that something would be triggered by the payment process itself - I'm sure lots of others don't visit the forum or pay attention to their mails.

There is an interesting contrast with the way the PP overpayment was handled. IS mistake but it didn't stop them going to the effort of recovering trivial sums (less than being discussed here) from thousands of contributors.

Dumc · « **Reply #31 on:** June 12, 2015, 01:27 »

There is a solution, you know. Quit iStock.

Micky_Mango · « **Reply #32 on:** June 12, 2015, 01:42 »

Quote from: Dumc on June 12, 2015, 01:27

There is a solution, you know. Quit iStock.

He'd have nothing to complain about then.

ShadySue · « **Reply #33 on:** June 12, 2015, 02:42 »

Quote from: Micky_Mango on June 12, 2015, 01:42

Quote from: Dumc on June 12, 2015, 01:27
There is a solution, you know. Quit iStock.
He'd have nothing to complain about then.

The alternatives seem not to be totally complaint-free zones.

Semmick Photo · « **Reply #34 on:** June 12, 2015, 03:11 »

Quote from: Micky_Mango on June 12, 2015, 01:42

Quote from: Dumc on June 12, 2015, 01:27
There is a solution, you know. Quit iStock.
He'd have nothing to complain about then.

Complaining about someone else complaining seems even more fruitless to me.

bunhill · « **Reply #35 on:** June 12, 2015, 04:51 »

Quote from: heywoody on June 11, 2015, 05:26

The "rules" in a properly designed IT solution would have accommodated this as it is a blindingly obvious scenario

Not if compliance with the IRS processes require them to do things in some particular way.

I believe that we can assume that this is down to the IRS - since the same conditions apply with respect to Kindle authors (if you Google this - bear in mind that many of the conflicting answers pre-date the recent revisions). Anyone looking to claim back an over-payment (including as a result of incomplete details) needs to deal directly with the IRS (which I think means submitting a US tax return). That's the system.

Quote from: heywoody on June 11, 2015, 16:45

There is an interesting contrast with the way the PP overpayment was handled.

No this comparison doesn't work. Because it is not about contributors trying to get money back from the IRS.

heywoody · « **Reply #36 on:** June 13, 2015, 05:53 »

Quote from: Micky_Mango on June 12, 2015, 01:42

Quote from: Dumc on June 12, 2015, 01:27
There is a solution, you know. Quit iStock.
He'd have nothing to complain about then.

I'd certainly have less to complain about but I enjoy a good rant

. Take away complaints and forum posts would be a little thinner on the ground.

Quote from: bunhill on June 12, 2015, 04:51

Quote from: heywoody on June 11, 2015, 05:26
The "rules" in a properly designed IT solution would have accommodated this as it is a blindingly obvious scenario

Not if compliance with the IRS processes require them to do things in some particular way.

I believe that we can assume that this is down to the IRS - since the same conditions apply with respect to Kindle authors (if you Google this - bear in mind that many of the conflicting answers pre-date the recent revisions). Anyone looking to claim back an over-payment (including as a result of incomplete details) needs to deal directly with the IRS (which I think means submitting a US tax return). That's the system.

A competent systems analyst would have identified this obvious scenario and put in place rules that would have prevented the deduction in the first place. Putting in place exception scenarios to handle user mistakes is a significant consideration putting use cases or requirements lists together.

Quote from: bunhill on June 12, 2015, 04:51

Quote from: heywoody on June 11, 2015, 16:45
There is an interesting contrast with the way the PP overpayment was handled.

No this comparison doesn't work. Because it is not about contributors trying to get money back from the IRS.

This point has some marginal merit in a situation where the deduction details and money has already been sent to IRS and they send returns for each individual payment to contributors. US taxes most likely operate differently to here but, where I live, tax adjustments (PAYE or as an independent contractor) either + or – can be handled without going to revenue until such time as final returns are made for the year. In fact, one can only look to Revenue for tax refunds in respect of previous tax years.
In any case the point I was making was more general. They made a big effort to chase down individual contributors over pennies because it’s their money. How successful would they have been if they adopted the forum posts and email approach there?

bunhill · « **Reply #37 on:** June 13, 2015, 08:27 »

Quote from: heywoody on June 13, 2015, 05:53

A competent systems analyst would have identified this obvious scenario and put in place rules that would have prevented the deduction in the first place.

You are presuming that the IRS processes would allow this. I am assuming that they don't.

Quote from: heywoody on June 13, 2015, 05:53

Putting in place exception scenarios to handle user mistakes is a significant consideration putting use cases or requirements lists together.

Yes and no. Knowing about possible exceptions is certainly an important part of analysis. But effective design is equally about taking deliberate decisions about what the system actually needs to do (for example - deliberately deciding to leave something out because of some conflict or difference of precedence between 2 criteria). Bear in mind that iStock has a contractual obligation to make the payout as detailed.

The system is not just IT. And it does include and account for the possibility of users failing to properly complete the paperwork - by thoroughly documenting and explaining the entire process well in advance.

heywoody · « **Reply #38 on:** June 13, 2015, 10:02 »

I'm no expert on US income tax arrangements but have been involved in systems deployments for US companies that included a withholding tax element and did cater for this type of situation. Some organisations do a bit of planning / analysis and design a solution that caters for their various stakeholders, some slap on a band-aid.

bunhill · « **Reply #39 on:** June 13, 2015, 10:12 »

Quote from: heywoody on June 13, 2015, 10:02

(I) have been involved in systems deployments for US companies that included a withholding tax element and did cater for this type of situation.

How did the implementation work in practice ? Are you saying that the system was capable of doing a refund in the event that a person later submitted different details ? Or was payment withheld until after the person's tax details had been accepted ?

ShadySue · « **Reply #40 on:** June 13, 2015, 16:35 »

Quote from: heywoody on June 11, 2015, 16:45

My point about communication is that something would be triggered by the payment process itself - I'm sure lots of others don't visit the forum or pay attention to their mails.

As someone said above, we each have a responsibility to take care of our own business.

Anyway, let's say the payment process flagged up that you hadn't bothered to do the tax interview. They might have sent you an email and you'd have ignored it.
Then what?
(Indeed, it might have happened in fact, but you wouldn't know.)

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Author Topic: Withholding Tax (Read 19666 times)

heywoody

Micky_Mango

Semmick Photo

heywoody

ShadySue

heywoody

Dumc

Micky_Mango

ShadySue

Semmick Photo

bunhill

heywoody

bunhill

heywoody

bunhill

ShadySue

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