In the near future, Udemy will begin automatically withholding the appropriate amount from each instructor payment based on tax status.
Your rate of withholding will depend on a number of factors, most importantly your country of tax citizenship. We can’t tell you exactly what rate of withholding will apply to your Udemy earnings until your form is submitted and approved, but when we do begin automatically withholding, you’ll be able to see the rate in your revenue report.
What happens if I don’t submit a tax form?
Udemy is giving all instructors time to fill out the necessary forms. Once withholding is in effect (later in 2019), if we don’t have an instructors’ tax information on file, we’ll pause your next payout and remind you again to submit.
If at that point we still don’t have your tax information, we’ll be required to default to the highest potential level of withholding on your revenue and we’ll resume sending payouts (no longer holding them), so that we can minimize your risk of noncompliance.
This might mean that we withhold more from your payouts than the Internal Revenue Service (IRS) actually requires. Depending on your circumstances, there may be avenues for instructors to recoup funds that were withheld in excess of your legal obligation.
Udemy will send reminders throughout this process, but completing the form submission now is the best way to avoid any late complications.