Holding out against withholding
WHEN WORKING for foreign clients - as NUJ freelance members are everywhere, "foreign" just means not in the country where you're based - withholding tax can sometimes be a problem. It's a tax, often 10 per cent, deducted from your fee by the tax authorities in Whereverland before it arrives in your bank account and becomes subject to normal UK tax.
But an assertive member of LFB has come up with a solution that just might work for any of us - which I will call the Nothing To Do With Me Guv Gambit.
She did her first feature for a Far East magazine and agreed a fee of the equivalent of around £600. The fee arrived promptly in her bank account - except that, unannounced, it came up short by something over £60. She emailed to complain and the magazine's accounts department advised that withholding tax had to be deducted. And currency exchange charges too.
Our member wasn't having any of that, if she could avoid it, and told the Freelance, "I went several rounds with their accounts people, explaining that none of the above interested me, that the agreed fee was the agreed fee, kindly cough up by return of post, etc. No dice."
She was starting to feel this was a put-it-down-to-experience lost cause when the morning e-post revealed a message from the editor, who'd heard about the problem and come up with a solution - coughing up. He apologised and said he would add the tax and exchange rate deduction on to the fee for a second piece, while ensuring that for all future commissions the deductions would be dealt with by the magazine and the full agreed fee paid to the freelance.
Our member says it confirms her belief that "If you treat yourself like a professional worthy of professional respect, other people tend to treat you like one as well".
Do check up about withholding tax when working with clients in a country you haven't dealt with before. Negotiate a fee (and expenses) in terms of what you're actually going to be paid net, regardless of any deductions that have to be paid "over there".