Film Accounting Glossary
Nonresident withholding
What is nonresident withholding?
Also called foreign withholding, or non-resident withholding.
Nonresident withholding is tax a production must deduct and remit when paying an individual or company that is not resident in the paying jurisdiction, common for foreign talent and for loan-outs working across state lines.
Rates and treaty reductions vary, and the obligation sits with the payer, not the recipient. Getting it wrong means the production owes the tax itself, which is why treaty paperwork is collected before the first payment rather than after.
Example
A production pays a foreign performer $120,000. Absent treaty relief and the paperwork to support it, withholding is required at the statutory rate, and if the show does not withhold it owes the tax itself plus penalties.
Figures are illustrative, chosen to show the mechanics rather than to quote market rates.
Where you'll see it
Handled at vendor and cast onboarding, before the first payment. Treaty paperwork collected up front, never after the fact.
Common mistake
Paying a foreign payee gross and collecting treaty paperwork afterwards. The obligation sits with the payer, so the production owes the tax if it did not withhold.
Related questions
- When does nonresident withholding apply on a production?
- When paying an individual or company not resident in the paying jurisdiction, including foreign talent and loan-outs working across state lines.
- Can a tax treaty reduce nonresident withholding?
- Often yes, but only with the correct documentation on file before payment. Without it, the statutory rate applies and the payer carries the exposure.