The W-8BEN form for individuals is the “driver” or determining document for all non-US persons. It gives the US holder the necessary information to determine your tax status for US taxes.<\/p>\n
\u2022 The form contains the obvious information name, permanent and mailing addresses, country of citizenship. The need for all of these is fairly obvious and is what is required in almost every country for an account to be opened for documentation for a revenue stream.
\n\u2022 There are a couple of more unusual things required on the form:
\no Date of birth
\no Foreign tax identifying number or Social number.<\/p>\n
\u2022 In 2010 the US Congress enacted the Foreign Account Tax Compliance Act commonly referred to as FATCA.
\no The primary purpose was to “capture” income of US persons earned overseas and from assets and accounts held overseas to collect the tax due to the US government.
\no A secondary offshoot of FATCA was information sharing with other countries. In order to capture earnings in other countries the US needed to share information about income of non-US persons here.
\n\u2022 FATCA requires that the US share information with most other countries and they with the US concerning accounts held by their residents.
\n\u2022 This information sharing is what prompted the addition of DOB and the local tax (or social) number to the W-8BEN.
\n\u2022 The final piece of information on the W-8BEN is tax treaty eligibility.
\n\u2022 The US has tax treaties with approximately 70 countries.
\n\u2022 Your country of primary residence (tax residence) determines tax treaty eligibility.
\n\u2022 If you reside in a country with a tax treaty with the US then you are eligible for the benefits \u2013 i.e. lower US withholding rates.
\n\u2022 Your permanent address must match your treaty country on form W-8BEN.<\/p>\n
\u2022 Your new country of residence may have lower withholding rates than your previous residency country. Information sharing – if you do not update your information will continue to go to the country of your old address and not the new – the old residency country might then look for tax payments.
\n\u2022 W-8BENs expire.
\n\u2022 They are good until December 31 of the third year after they are signed. Renew them before they expire as if they lapse, US withholding will be applied to all income.
\n\u2022 If this information is not provided then additional income, such as proceeds from the sale of investments is subject to withholding.<\/p>\n","protected":false},"excerpt":{"rendered":"
The W-8BEN form for individuals is the “driver” or determining document for all non-US persons. It gives the US holder the necessary information to determine your tax status for US taxes.<\/p>\n","protected":false},"author":1,"featured_media":221504,"parent":0,"comment_status":"open","ping_status":"open","template":"","meta":{"_acf_changed":false,"footnotes":""},"contributors-categories":[13576],"traders-academy":[13125,13128,13132],"class_list":{"0":"post-175425","1":"trading-lessons","2":"type-trading-lessons","3":"status-publish","4":"has-post-thumbnail","6":"contributors-categories-interactive-brokers","7":"traders-academy-beginner-trading","8":"traders-academy-level","9":"traders-academy-trading-lesson"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"\n