An honorarium is normally a one-time payment granted in recognition of a special service or distinguished achievement for which propriety precludes setting a fixed price, such as a special lecture, participation in a workshop or panel discussion, or similar activities. If the fee is prescribed by the individual or if it is negotiated, an honorarium situation does not exist, rather a contract for services exists. Further, it is inappropriate to pay honoraria to individuals who make significant instructional contributions to a course. Please get in touch with the Business Office to initiate a Guest Speakers/Honorarium payment.
Note: If parties enter into a formal agreement on price, the transaction constitutes an agreement/contract, not an honorarium. Honoraria correspondence does not include terms and conditions or result in the receipt of an invoice for payment. Agreements/contracts are subject to procurement policies and procedures.
Honoraria can be offered to foreign nationals providing services within the U.S, however foreign nationals are subject to federal tax withholding and reporting and must have a visa classification that permits honorarium payment. Additional documentation will be required. (https://www.finance.ucla.edu/tax-records/tax-services/payments-to-foreign-nationals)
UCLA is obligated to withhold 7% from all non-California residents (individuals or vendors) for services performed in California that exceed $1,500 in a calendar year and are reported on Form 592-B. If providing a virtual speaking engagement (i.e., Zoom) please provide the SON-Business Office the location of the services. (e.g., Dr. Smith provided a virtual lecture to the N232 class via Zoom from his home in Durham, North Carolina.)
Examples: What is NOT Considered an Honorarium
- Performance fee payments to individuals or groups for professional services not directly related to academic functions.
- Payments to independent consultants providing primarily professional or technical advice to the University in an independent contractor relationship.
- Payments to faculty consultants who hold an academic appointment and who provide specialized professional or technical advice to a campus extramurally supported project or to an activity supported from University funds.
*Resources: University of California | Office of the President (D371-35: Disbursements – Honoraria Payments)
Withholding on Payments to California Nonresidents
Non-wage payments to nonresidents of California are subject to 7% state income tax withholding if the total payments during a calendar year exceed $1,500.
California nonresidents include:
- Individuals who are not residents of California.
- Business entities such as corporations, partnerships or LLCs that are either not registered with the California Secretary of State to do business in California or have no permanent place of business in California.
Payments subject to withholding include:
- Payments to nonresident independent contractors who provide services in California.
- Other non-wage payments of California source income to nonresidents such as leases, rents, royalties, winnings, and payouts.
At year end, the California non-resident will receive from the University a Form 592B which reports the gross income paid and state tax withheld.