A question for UK iPhone developers registered as a company and IRS

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Post: #1
I'm a UK based limited company registered with iPhone development as a company.

I recently went through the process of completing the paperwork for the US tax prior to submitting my app.

Today (28th May 2009) I received a letter from the IRS saying that I had not filed any tax returns going back to at least 2005 (funny that seeing as I don't live in their country and have not traded in the US!).

In order to rectify this they want me to complete a form 1120F (and make any due payments) by 27th May 2009!!!!

Have any other developers experienced the same issues and if so, what did you do?

Thanks.
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Post: #2
AFAIK you shouldn't be paying any US tax as you're not US based. Our situation is a little different as so far all our US sales have been through our publisher who pays us, but that's only the same as publishing through Apple directly in theory (Apple makes the sale not you).

I'd hook up with a good UK based accountant (you should have one anyway if you're running a Ltd company, a good one is worth everything they're paid) as they'll be able to give you proper advice, even if they have to do a bit of consulting with associates who handle US tax.

My guess is that the paperwork you filled in for US tax was for US companies rather than the non US companies earning money from the US, so the IRS have you tagged as a US taxpayer by mistake.
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Post: #3
Thanks for the response.

I contacted my accountant after my original post and I'm waiting to hear back about it.

I followed the steps as advised on the Apple site for non US companies and spent about half an hour on the phone to IRS overseas department but the line was bad so I won't be surprised if there has been some mistake made.
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Post: #4
Zwilnik Wrote:My guess is that the paperwork you filled in for US tax was for US companies rather than the non US companies earning money from the US, so the IRS have you tagged as a US taxpayer by mistake.

I doubt it.

1120-F is explicitly designated as "U.S. Income Tax Return of a Foreign Corporation" so it seems they do know he is not US based.
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