W-8BEN Form

A form to fill by foreign individuals who receive income in US

What is the W-8BEN form?

Form W-8BEN is filed by foreign individuals who receive income in the United States. Such income may be in the form of dividends, royalties, payments for services rendered, etc. and is taxed at a rate of 30%. By filing Form W-8BEN, a person is entitled to a reduced rate or exemption from tax if there is an Income Tax Treaty between the United States and the country in which the person is located. Form W-8BEN-E is similar, except that it is filed by businesses rather than individuals.

Forms W-8 are Internal Revenue Service (IRS) forms that foreign individuals and businesses must file to prove their country of residence for tax purposes, confirming that they qualify for a lower withholding rate.

Although W-8 forms are issued by the IRS, they are only available to payers or withholding agents, not to the IRS. Failure to submit the form may result in a withholding at the full 30% rate that applies to foreign entities.

Who can file Forms W-8?

Forms W-8 are completed by foreign individuals or entities who do not have US citizenship or residency but have worked in the US or earned income in the US. Most often, the form is filled out by companies registered abroad and foreigners - non-residents.

For example, a non-resident alien who receives interest or dividends from US-issued securities is likely to file Form W-8BEN, while a foreign non-profit organization doing business in the US may be required to file Form W-8ECI. Former US residents who receive retirement income or occasionally do freelance work for US clients may also need to file a form to reduce their tax withholdings.

Foreign individuals or entities deriving US income are subject to a 30% tax on certain types of income.

How can I get the W-8BEN form?

Form W-8BEN is sent by the company making payments to the individual. The completed Form must be returned to the company submitting Form W-8BEN and not directly to the IRS.