This is the most important section of Form W-8BEN-E. This must be a complete part when you submit the documents. Take your time here to make sure all the data is correct and in the right place. Form W-8IMY is the “certificate issued by a foreign intermediary, foreign flow-through entity, or U.S. branches designated for U.S. withholding and filing.” The purpose of the form is to certify that a person or company has received payments withheld on behalf of a foreign national or as an intermediary entity. The form is intended for intermediaries and should not be used by the beneficial owners of a company. Form W-8BEN-E is also known as the Certificate of Foreign Beneficial Ownership Status for U.S. withholding tax. This is an important document that allows a company operating outside the U.S. to claim a tax exemption on U.S. income. The W-8BEN-E is an IRS form used by foreign companies doing business in the United States.
Only corporations and partnerships are required to submit this form. Individuals and sole proprietors must submit Form W-8BEN. Form W-8BEN-E is used to confirm that a seller is a foreign company and must be completed before the seller can be paid, according to the University of Washington. As with foreign individuals receiving certain types of income, money generated by foreign corporations is typically withheld at a rate of 30% by the payer or withholding tax office in the United States. However, the form allows the foreign company to claim a tax reduction if its country of residence has a tax treaty with the United States. If you are a non-resident who receives income (excluding income from personal services) in the United States, you must complete it. If you are a non-eligible entity receiving a withheld payment, enter your name on line 3 if you: 1) registered with the IRS and have been assigned a GIIN associated with the legal name of the non-eligible entity; 2) an IFF reporting model 1 or a FIF reporting model 2; and (3) are not a hybrid entity using this form to claim contractual benefits. Don`t worry about getting a U.S. Federal Tax ID just to fill out this form. You may need this number for other reasons, but not just to complete Form W-8BEN-E. In the section requesting your foreign tax identification number, you must use your HMRC ID. If you have multiple branches/non-considered entities that receive payments from the same withholding office and the information in Part I is the same for each branch/non-considered entity receiving payments, a withholding taxpayer may accept a single Form W-8BEN-E from you with an attached annex that includes all the information in Part II for each branch/unaccounted entity, instead of separate W-8BEN-E forms to identify each branch/non-considered entity that makes payments related to the form and assignment of the payment to each non-considered branch/entity.
You can check the box on line 9c if you have an account, as described in line 9b, and you are not required by law to obtain an FTIN from your country of residence (even if the jurisdiction does not issue an FTIN). If you check this box, you will be treated as if you had given an explanation for the non-provision of an FTIN on line 9b. If you wish to provide an additional (or other) explanation as to why you do not need to provide an FTIN on line 9b, you may do so in the margin of this form or in a separate statement attached to this form. The W-8BEN-E shape is long – it consists of 30 parts. However, not all fields on the form need to be filled out for a foreign supplier to be paid by a U.S. company. Requirements vary. You are applying for a foreign government, international organization, foreign central bank, foreign tax-exempt organization, foreign private foundation, or U.S. government claiming the applicability of Section 115(2), 501(c), 892, 895, or 1443(b).
Instead, submit Form W-8EXP, Certificate of Foreign Government or Other Foreign Organization for United States Tax Withholding and Reporting to certify your exemption and identify your Chapter 4 status. However, you must complete Form W-8BEN-E if you are applying for contractual benefits, and you may provide this form if you only claim that you are a foreign person exempt from withholding or documenting your Chapter 4 status. For example, a foreign organization exempt from tax under section 501(c) that receives royalty income that is not exempt because it is taxable as independent business income, but that qualifies for a reduced withholding tax rate under a licensing article of a tax treaty must complete Form W-8BEN-E. You must use Form W-8ECI if you generate effectively related income (e.g., income from business activities that are not exempt under an applicable section of the Code). A retention agent may allow you to electronically sign this form. The electronic signature must indicate that the form was signed electronically by an authorized person (for example, with a timestamp and a statement that the form was signed electronically). Simply typing your name in the signature line is not an electronic signature. A withholding office may also rely on an electronically signed withholding tax certificate if you provide additional information or documents requested by the withholding officer to prove that the form was signed by you or another person authorized to do so. See section 1.1441-1(e)(4)(i)(B). You will then have to sign the form promising that all the information is correct. In other words, W-8BEN is reserved for individuals, while entities must complete W-8BEN-E. If you are an active NFFE, you must check the box to confirm that you meet all requirements for this status, including the asset and passive income test described in the certification for this part.
For the purposes of this test, passive income includes dividends, interest, rents, royalties, annuities and certain other forms of passive income. See section 1.1472-1(c)(1)(iv)(A) for more details on the definition of passive income. See also section 1.1472-1(c)(1)(iv)(B) for exceptions to the definition of passive income for certain types of income. Form W-8BEN (“Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting”) must be completed by foreign persons receiving certain types of income in the United States. The form, sometimes called a “foreign status certificate,” indicates that the person is both a foreign person and the owner of the business in question. Do not submit Form W-8BEN-E to the IRS. Instead, give it to the person who asks for it. Typically, this is the person from whom you receive the payment who credits your account or a partnership that allocates income to you. An FFI may also ask you for this form to document the status of your account. Form W-8BEN-E tells your client that all of your winnings are located in the UK or any other country, so there is no liability to report tax in the US. This means that the client does not have to withhold U.S. federal tax.
Any corporation or corporation located outside the United States, or corporation doing business with a U.S.-based corporation or corporation, must file a Form W-8BEN-E with a payer`s withholding agent before the first payment is received or collected. This form is not sent to the IRS, but is used by the withholding officer for payment and withholding settlements. Form W-8BEN-E contains the wording of the relevant section of this contract and tells your U.S. customer that they do not need to be taxed if they do business with you. If you are not required to provide the legal name of the non-eligible entity, you may inform the withholding tax office that you are an unaccounted entity receiving a payment or maintaining an account by providing the name of the non-considered entity on line 10. If you wish to report the name of a non-considered entity that has an account to the receiving entity requesting this form for informational purposes only (i.e. the non-considered entity is not reported on line 1 or Part II of this form), you can enter the name of the non-considered entity in line 3. For example, if your U.S.-based company enters into a foreign partnership with a marketing company, it will provide your holding officer with Form W-8BEN-E. However, if your company hires a foreign independent contractor to write the blog content, they will provide your retention agent with IRS Form W-8BEN. UW policy states that a new W-8BEN-E must be purchased for all payments made by the UW by a non-resident alien (NRA).
The previous year`s W-8BEN-E forms cannot be used in subsequent years because non-resident alien (NRA) status can change from year to year and even within a calendar year. These instructions have been updated to reflect the use of this form by a corporation (other than a partnership, simple trust or constituent trust) that is a foreign seller of a life insurance contract or that is a foreign person and beneficiary of a reportable death benefit for Section 6050Y reporting purposes. The form is used to document the status of Chapter 3 and 4 foreign companies that receive income from U.S. sources. In general, U.S. income is subject to a 30% withholding tax according to U.S. tax standards. Foreign companies must submit a Form W-8BEN-E to the source agent representing the U.S. source to document their status and indicate what withholding tax they are subject to.
The W-8BEN-E is a form issued by the Internal Revenue Service (IRS). All foreign (non-U.S.) companies that receive payments from a U.S. corporation must complete Form W-8BEN-E.