This guide is prepared to help you fill a W8-Ben form in the easiest and simplistic way. We are very happy to generate guides for freelancers and independent contractors as RemoteTeam.com, but first, let’s see what W8-Ben Form is used for.
What Is W8-Ben and Who Is This For?
Form W-8BEN is used by foreign individuals who receive non-business income in the United States. In simple terms, foreign people doing business in America as freelancers or investors are required to fill out this form. This form is filled in the collection stage to be given to the person to whom the income will come. But don’t forget, W8-Ben form can be used by an individual. If you are doing business as an entity, you will need to fill out a W8-Ben-E form, not a W8-Ben.
Form W-8BEN is a document that you must complete if you want to invest in the US (United States) stocks and shares. It represents the information that we are required to record for the US Internal Revenue Service (IRS).
The form also helps you claim a reduction or an exemption from the U.S. tax withholding if you reside in a country with which the United States has an income tax treaty and the income you received is subject to that treaty.
W8-Ben Part I: Identification of Beneficial Owner
Line 1: Name of individual/Beneficiary
Full name of the beneficial owner: freelancer/investor/employee
Line 2: Country of citizenship
You should enter the country name as it appears on your passport. Abbreviations are not accepted.
Line 3: Permanent residence address (street, apt. or suite no., or rural route). Do not use a P.O. box or in-care-of address. And Country.
Full permanent residential address in the country where you claim to be a resident.
Line 4: Mailing address (if different from above)
Only enter a mailing address if it’s different from your residential address
Line 5 and 6: U.S. taxpayer identification number (SSN or ITIN), if required. And Foreign tax identifying number
Put your TIN here. In the UK this will be your National Insurance Number.
Line 7: Reference number(s)
Put your Reference Number here.
Line 8: Date of birth (MM-DD-YYYY)
Enter the date of birth.
W8-Ben Part II: Claim of Tax Treaty Benefits (for chapter 3 purposes only)
If you are claiming treaty benefits as a resident of a foreign country with which the United States has an income tax treaty for payments subject to withholding under chapter 3, identify the country where you claim to be a resident for income tax treaty purposes. For treaty purposes, a person is a resident of a treaty country if the person is a resident of that country under the terms of the treaty. A list of U.S. tax treaties is available at IRS.gov/ Individuals/International-Taxpayers/Tax-Treaties.
If you are related to the withholding agent within the meaning of section 267(b) or 707(b) and the aggregate amount subject to withholding received during the calendar year exceeds $500,000, then you are generally required to file Form 8833, Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b), available at IRS.gov/Form8833. See the Instructions for Form 8833 for more information on the filing requirements.
Chapter 3 means:
Chapter 3 of the Internal Revenue Code (Withholding of Tax on Nonresident Aliens and Foreign Corporations). Chapter 3 contains sections 1441 through 1464
Put your country of residence for tax purposes here
Line 10 must be used only if you are claiming treaty benefits that require that you meet conditions not covered by the representations you make on line 9 and Part III. For example, a person claiming treaty benefits on royalties must complete this line if the treaty contains different withholding rates for different types of royalties. However, this line should always be completed by foreign students and researchers claiming treaty benefits. See CAUTION! Scholarship and fellowship grants, later, for more information.
This line is generally not applicable to treaty benefits under an interest or dividends (other than dividends subject to a preferential rate based on ownership) article of a treaty.
W8-Ben Part III: Certification
Form W-8BEN must be signed and dated by the beneficial owner of the amount subject to withholding or the account holder of an FFI (or an agent with legal authority to act on the person’s behalf). If Form W-8BEN is completed by an agent acting under a duly authorized power of attorney for the beneficial owner or account holder, the form must be accompanied by the power of attorney in proper form or a copy thereof specifically authorizing the agent to represent the principal in making, executing, and presenting the form. Form 2848 can be used for this purpose. The agent, as well as the beneficial owner or account holder, may incur liability for the penalties provided for an erroneous, false, or fraudulent form.
A withholding agent may allow you to provide this form with an electronic signature. The electronic signature must indicate that the form was electronically signed by a person authorized to do so (for example, with a time and date stamp and statement that the form has been electronically signed). Simply typing your name into the signature line is not an electronic signature.
So basically in part 3:
- Please make sure you enter the date in the American format shown – month first, then the day of the month, then the year.
- Sign and date the form. If you are not the beneficial owner, indicate the capacity in which you are acting.