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This provision allocates tax compliance responsibility to Customer and implements a gross-up mechanism to protect Anthropic's net revenue. The gross-up calculation compounds by including taxes on the gross-up payment, creating a formula-based adjustment to ensure Anthropic's economic position remains unchanged regardless of Customer's withholding tax obligations.
Customers are obligated to identify, remit, and document all applicable withholding taxes to authorities and to calculate and pay an additional gross-up amount to Anthropic equal to the full fee plus all associated taxes. This increases the total cost of services to Customer beyond the stated fee amount and requires Customer to perform tax calculations and provide evidence of tax payments upon request.
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"Fees do not include any taxes, duties, or assessments that may be owed by Customer for use of the Services ("Taxes"), unless otherwise specified in the applicable invoice. Customer is responsible for remitting any necessary withholding Taxes to the relevant authority on a timely basis and providing Anthropic with evidence of the same upon request. For clarity, Customer must pay Anthropic the amount ("Gross-up Payment") that will ensure that Anthropic receives the same total amount that it would have received if no such withholding or reduction by Customer had been required (taking into account any and all applicable Taxes (including any Taxes imposed on the Gross-up Payment)).— Excerpt from Anthropic's Anthropic Commercial Terms
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This provision allocates tax compliance responsibility to Customer and implements a gross-up mechanism to protect Anthropic's net revenue. The gross-up calculation compounds by including taxes on the gross-up payment, creating a formula-based adjustment to ensure Anthropic's economic position remains unchanged regardless of Customer's withholding tax obligations.
Customers are obligated to identify, remit, and document all applicable withholding taxes to authorities and to calculate and pay an additional gross-up amount to Anthropic equal to the full fee plus all associated taxes. This increases the total cost of services to Customer beyond the stated fee amount and requires Customer to perform tax calculations and provide evidence of tax …
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