W8 BEN and W8 BEN – E Completion

W8BEN and its types

Form W8 completion is required as part of the due diligence requirements applicable to withholding agents for establishing a beneficial owner’s foreign status and claim for reduced withholding under an income tax treaty. If you fail to complete Form W8BEN your withholding agent has an obligation to withhold a flat 30% tax on the gross income being distributed

Form W-8BEN

Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals).

Form W-BEN-E

Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities).

Form W-8ECI

Certificate of Foreign Person’s Claim That Income Is Effectively Connected With the Conduct of a Trade or Business in the United States

Who is the withholding agent?

Any person, U.S. or foreign, in whatever capacity acting, that has control, receipt, custody, disposal, or payment of an amount subject to withholding is a withholding agent.

The withholding agent may be an individual, corporation, partnership, trust, association, or any other entity, including (but not limited to) any foreign intermediary, foreign partnership, or U.S. branch of certain foreign banks and insurance companies.

If several persons qualify as withholding agents for a single payment, the tax required to be withheld must only be withheld once. 

Form 1042S/Form1099/Form 8804/Form 8805

Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons, 

Form 1042-S, Foreign Person’s U.S. Source Income Subject to Withholding, for return filing and information reporting obligations with respect to payments made to foreign persons. For more details on Form 1042S Click here

Form 8804, For effectively connected taxable income (ECTI) allocable to a foreign partner, the partnership is generally the withholding agent and must file Form 8804, Annual Return for Partnership Withholding Tax (Section 1446); 

Form 8805, Foreign Partner’s Information Statement of Section 1446 Withholding Tax; and Form 8813, Partnership Withholding Tax Payment Voucher (Section 1446).

On Form W8BEN [Part 1 – Line 5 US Tax Identification SSN or ITIN] 

It’s very important the completion of Form W8BEN is accurate with US tax ID numbers, country of residence, and tax treaty article numbers, the reason being the US Tax ID would be reported on tax withholding forms and if you are filing US nonresident alien tax return for FIRPTA claim, Partnership withholding, excess investment tax withholding if the number is not correct the IRS will not release the refund payment.

For the difference between an SSN and ITIN refer to this blog. For more information and a list of who requires an ITIN?

ur team specializes in international expatriate U.S. personal tax return service. If you need assistance with ITIN Renewal/US 1040 filing for refund claim/FATCA Compliance work/FBAR FINCEN114 Filing, ITIN/ Form W7 Application/E.I.N./Form W8BENE or Certified Acceptance Agents [C.A.A.] services/1040NR U.S. tax filing for refund claim of excess 1042S / 8288A/ 8805/ W2/ 1099. We are happy to assist our clients in a timely, efficient, and cost-effective way

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