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What is a W-8 BEN and who needs to file one?

Form W-8BEN

Form W-8BEN is, ‘Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting.’

Form W-8BEN should be provided to any withholding agent or payer if you are a nonresident alien who is the beneficial owner of an amount subject to withholding.

The W-8BEN should not be used in the following circumstances:

  1. By any entity documenting its Chapter 4 FATCA status. That entity should complete form W-8BEN-E.
  2. By a US citizen or permanent resident. Instead that person should use form W-9.
  3. By a person or entity acting as a foreign intermediary. Instead that person should use form W-8IMY.
  4. By a person who is a nonresident alien and is claiming exemption from withholding on compensation for independent or dependent personal services performed in the US. Instead, that person should complete form 8233 or Form W-4.
  5. You are receiving income that is effectively connected with a US trade or business that is not allocable to you via a US partnership. Instead, complete form W-8ECI.

Generally, an amount subject to withholding is any amount from sources within the US that is fixed determinable annual or periodic income (FDAP) income.  Dividends, royalties, rents, and compensation is FDAP income.

A taxpayer is a nonresident alien if they are not a resident alien, permanent resident or US citizen.

If the right W-8 form is not filed tax will be withheld at the applicable domestic withholding tax rate, which in most cases, will be 30%.