I do book-keeping only for a client who is going to do a short visit to the USA and give a lecture. The company he is contracting to has agreed to pay expenses but has just emailed him with form W-9 - an IRS form headed Request for Taxpayer Identification Number and Certification. The US company say this will not mean he has to pay tax. Unfortunately I couldn't make head nor tail of it and quickly realised that as I am not an expert on US tax we should ask his accountant to deal with it.
His accountant is out at the moment. When someone for whom I act as an accountant has this problem in future, to whom should I direct him?
Related resources
Replies (5)
Please login or register to join the discussion.
This has been raised previously
If you read the bottom of the form it clearly states that it only applies to "US Persons".
On the presumption that your client is a UK Subject, has no US residence visa and wasn't born in the US, then he cannot complete the form as he has neither the necessary eligebility or tax references.
"Use Form W-9 only if you are a U.S. person (including a resident alien), to provide your correct TIN to the person requesting it (the requester) and, when applicable, to:Certify that the TIN you are giving is correct (or you are waiting for a number to be issued),Certify that you are not subject to backup withholding, orClaim exemption from backup withholding if you are a U.S. exempt payee. If applicable, you are also certifying that as a U.S. person, your allocable share of any partnership income from a U.S. trade or business is not subject to the withholding tax on foreign partners’ share of effectively connected income.Note. If a requester gives you a form other than Form W-9 to request your TIN, you must use the requester’s form if it is substantially similar to this Form W-9. Definition of a U.S. person.For federal tax purposes, you are considered a U.S. person if you are:An individual who is a U.S. citizen or U.S. resident alien,A partnership, corporation, company, or association created or organized in the United States or under the laws of the United States,An estate (other than a foreign estate), orA domestic trust (as defined in Regulations section 301.7701-7).Special rules for partnerships. Partnerships that conduct a trade or business in the United States are generally required to pay a withholding tax on any foreign partners’ share of income from such business.
W8-BEN
I think it's the W8-BEN that is usually used to claim treaty benefits under the DTT so there is no withholding tax. It is here http://www.irs.gov/pub/irs-pdf/fw8ben.pdf but it means reading through the DTT (here: http://www.hmrc.gov.uk/taxtreaties/in-force/usa-consolidated.pdf ) to know which clause applies.But take it slowly and logically and it should make sense.
I agree
I think it's the W8-BEN that is usually used to claim treaty benefits under the DTT so there is no withholding tax.
That's the form they should have sent you.
Thank you very much for this information!
The US person who sent the form is not an accountant, just the person my client is liaising with in that company.
I will email her accordingly.
I agree - W-8BEN would be correct. This Form can be found here:
http://www.irs.gov/pub/irs-pdf/fw8ben.pdf
David Treitel | Managing Director | American Tax Returns Ltd
Email: [email protected]