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See what your options are, and find the right choice for you. To reset your password, you will need to first, enter your Username and click on Login. You may refer to the instructions below prepared by BB Americas Bank or visit the IRS website for more information.
Who should use a W8?
Give Form W-8 BEN to the withholding agent or payer if you are a foreign person and you are the beneficial owner of an amount subject to withholding. Submit Form W-8 BEN when requested by the withholding agent or payer whether or not you are claiming a reduced rate of, or exemption from, withholding.
This form is officially called the ‘Certificate of Foreign Person’s Claim for Exemption From Withholding on Income Effectively Connected With the Conduct of a Trade or Business in the United States’. It is filed by foreign individuals who receive income from US-based payers after engaging in a trade or business with them. The income they receive is considered “effectively connected income” by the IRS. It’s important to note that ECI is not subject to the same 30% withholding rate. Instead, after subtracting relevant deductions, it is taxed at the graduated rate that US citizens and resident aliens are subject to. If the type of income/country of residence is covered by a US tax treaty, it would be taxed at the lowest rate under that treaty.
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If the freelancer or vendor’s information changes , they should submit a new W-9 to you with the updated information. CapabilitiesPlatformSimplify the way you work with freelancers. Persons should use Form W-8BEN. U.S. persons file Forms W-9, W-4, and others. Do not rely on this W-8BEN guide alone as a source of tax advice. Refer to official IRS instructions on the IRS website and consult your attorney or CPA. We’ve paired this article with Laurie Hatten-Boyd’s AP Tax Compliance webinar.
Due to the complexity of the W-8 form, many who are required to fill it out work with a professional, such as an income tax preparation service, to do so. The penalty for not filing on time could result in up to a 30% fine. But tax forms are just part of what you need what is a w8 to know to stay compliant when hiring globally. Whether you want to hire one international contractor or grow an entire international team, Remote is here to help. Contact us today with any questions you may have on global employment or global contractor management.
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A W-8 form is an IRS form used by foreign individuals and entities doing business in the United States. Only fill out this section if you are claiming a tax treaty benefit. Please refer to the Instructions provided by the IRS to complete this section. If you are a dual citizen, enter the country where you are both a citizen and a resident at the time you complete this form. The beneficial owner derives the item of income for which the treaty benefits are claimed, and, if applicable, meets the requirements of the treaty provision dealing with limitation on benefits.
To finalize the form, read and make the required declarations and certifications. Old forms may be used for up to six months past the new revision date, so the old 2017 revision can be accepted until the end of April 2022. Of course, it’s best to adjust documentation to the new rules as soon as possible. You should collect a Form W-9 from every new freelancer or vendor they enlist during the onboarding process.
Form W-8BEN Explained
Tax withholding is required for most income earned in the U.S., regardless of whether the individual receiving that income is a U.S. citizen. Payers then forward this tax money to the federal government on behalf of the payee . The information contained within this website is provided for informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. The list of countries with relevant treaties is long and subject to change.