Vimeo On Demand transactions are sourced in the United States and are therefore subject to U.S. tax laws and withholding requirements.
Therefore, Vimeo is required to collect tax forms or automatically withhold funds from all VOD sellers, regardless of their home country, in order to be legally compliant.
After January 1, 2017, any Vimeo On Demand payments will be subject to 24% withholding of gross sales if you do not have an approved tax form on file. In these situations, the amount withheld will be immediately remitted to the U.S. Internal Revenue Service (IRS) and cannot be returned to the seller.
If you're a U.S. citizen or entity, we will not withhold any funds as long as you have a W-9 tax form on file by the time your payment is generated.
For sellers from other countries, your withholding rate may be up to 30% of your net revenue. However, many countries have tax treaties with the United States that will reduce this rate to 0%.
How your tax information is used: Vimeo uses Tipalti, a third party vendor to help gather and maintain your tax information. We may use the information supplied on your W-8 or W-9 for end-of-year reporting purposes. For example, when it’s time to send 1042s to international creators, or 1099s to U.S. creators that meet the required thresholds, your information will be used to generate those forms.