One of the most painful — and quietest — surprises for a Latin American musician who starts earning on Spotify, Apple Music, or YouTube is opening the monthly report and finding out 30% was withheld “for US taxes” before the money even reaches their bank account.

It’s not a mistake. It’s not the platform gouging you. It’s a federal withholding by the IRS (Internal Revenue Service) that applies by default to any non-US person receiving US-sourced income — and in music, “US-sourced income” means every stream played by a listener in the United States.

The good news: in most cases it can be reduced, and sometimes eliminated entirely, by correctly filing a Form W-8BEN and leveraging the tax treaty between your country and the US. This guide walks through how.

Why 30% gets withheld

When a streaming platform pays out royalties, part of that money is classified as “US-source income” — specifically the portion generated by listeners inside the US. Under federal law, any royalty payment sent from the US to a non-resident individual is subject to a default withholding of 30%.

This applies regardless of where you live: Mexico, Colombia, Argentina, Chile, or anywhere else. It is not a tax from your own country. It is not charged by the platform. It is not charged by your distributor. The US payer (through their payment infrastructure) withholds it and remits it directly to the IRS.

Two important clarifications:

The withholding only applies to the US-generated portion of your income, not the total. If 40% of your streams come from US listeners, the 30% is calculated on that 40%.
It is independent of the taxes you owe in your own country. In many cases you can credit what was withheld when you file locally, but that depends on your local accountant.

What Form W-8BEN is

The W-8BEN (“Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting — Individuals”) is the IRS form where you tell a US payer that you are not a US tax resident, and, if your country has a tax treaty, that you want to claim the reduced treaty rate.

Without this form filed and accepted, the platform or distributor is legally required to withhold the full 30%. With it correctly filed, the withholding drops to the treaty rate — 10% in some countries, 5% in others, and in a few cases even 0%.

It is an individual form. If you operate as a company/LLC/label, you’ll use the W-8BEN-E (entity version) — same principle, longer form.

LATAM countries with a US tax treaty

Here’s where most generic guides leave you hanging. The short answer:

With active US tax treaty (reduced royalty withholding):

Mexico
Venezuela
Chile (treaty in force since 2024)

Without US tax treaty (default 30% still applies):

Argentina
Colombia
Peru
Uruguay
Ecuador
Bolivia
Paraguay
Dominican Republic
Most Central American countries

If your country is in the first list, filing the W-8BEN saves you significant money. If it’s in the second, filing it is still worth doing — it gives the IRS your correct information, which avoids bigger problems like additional “backup” withholding — but it won’t reduce the 30%.

Important note: exact treaty rates vary by type of income (copyright royalties vs. patent royalties vs. personal services) and change over time. Before filing, verify the current rate for “royalties” with an accountant in your country, or check the treaty text directly on the IRS website.

How to fill out the W-8BEN step by step

The form has three parts. Most fields are straightforward:

Part I — Beneficial owner identification:

Name: your full legal name as it appears on your passport.
Country of citizenship: your country.
Permanent residence address: your real address in your home country. Don’t use a US address or PO box.
Mailing address (if different).
US Taxpayer Identification Number (SSN or ITIN): leave blank if you don’t have one. It’s not required for non-resident artists.
Foreign tax identifying number: your tax ID in your home country. This one matters — it’s what determines whether the treaty applies to you.
- Mexico: RFC
- Chile: RUT
- Argentina: CUIT or CUIL
- Colombia: NIT or cédula
- Peru: RUC or DNI
- Uruguay: RUT or CI
Date of birth: MM-DD-YYYY format.

Part II — Tax treaty benefit (only if your country has a treaty):

Line 9: write the name of your country (e.g. “Mexico”, “Chile”).
Line 10: this is where you specify the treaty article and reduced rate you’re claiming. For music royalties it’s usually the “Royalties” article of the bilateral treaty. This is the line most artists leave blank out of fear — and that’s why they end up paying the full 30%. If you’re unsure, your distributor or an accountant can help fill it out correctly.

Part III — Sign: sign, date, done.

The form is valid for 3 calendar years plus the year you signed it. After that it needs to be renewed.

What if 30% has already been withheld from you

If you’ve been getting paid with 30% withheld for months, there are two paths:

File the W-8BEN now: the reduced rate applies going forward, not retroactively. Future payments will come with the correct rate.
Recover what was already withheld: you can technically request a refund from the IRS by filing Form 1040-NR the following year, but the process is slow, requires an ITIN, and for small amounts it usually isn’t worth it. In practice, most artists write off that money and focus on getting the W-8BEN configured correctly to avoid overpaying again.

At Mh Musik you keep 100%

Mh Musik does not apply the 30% US withholding to non-resident artists. On a VIP plan, you collect 100% of what your music earns — no federal withholding taken out on our end, no percentage commission on top.

The W-8BEN is still worth having for your local tax filings and for platforms or payers that do require it, but at Mh Musik that 30% doesn’t come out of your payout.

Key takeaways

The 30% US withholding is real and applies by default — your distributor didn’t invent it.
The W-8BEN is the form that reduces or eliminates it, depending on your country’s tax treaty.
Mexico, Chile, and Venezuela have treaties; most of the rest of LATAM does not.
Even without a treaty, filing the W-8BEN is good practice.
Always verify the specific rates with an accountant in your country before signing.

Ready to release music with a 100% royalties model? Create your Mh Musik account and pick a VIP plan.

US Tax Withholding for Latin American Musicians: The W-8BEN Guide (2026)