W-8BEN: Meaning and Other Variations

This post was originally published on May 7th, 2024, and updated on May 20th, 2025.

The W-8BEN, also known as the Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals), is an official IRS form used by non-U.S. individuals to certify that they are not U.S. residents for tax purposes and to claim benefits under a tax treaty. This form is one of several W-8 series tax documents required by the Internal Revenue Service (IRS) for non-resident aliens and foreign entities conducting business or receiving income from U.S. sources.

The W-8BEN serves a dual purpose. First, it helps reduce or eliminate U.S. tax withholding on certain types of income under an applicable tax treaty. Second, it acts as documentation for compliance with IRS reporting requirements. Foreign individuals who receive dividends, royalties, interest, or other passive income from the U.S. typically use this form.

When to Use the W-8BEN and Other Tax Forms

The W-8 series forms are used for different situations depending on the nature of the foreign individual's or entity's income and tax status. Understanding when each form applies helps avoid incorrect filing and unnecessary withholding.

W-8BEN for Individuals

Foreign individuals should use the W-8BEN when they earn passive income from U.S. sources, such as dividends, royalties, or interest. The form certifies that they are eligible for a reduced withholding rate under an income tax treaty between their country and the United States.

W-8BEN-E for Entities

The W-8BEN-E is intended for use by foreign entities rather than individuals. A corporation, partnership, or trust based outside the U.S. should file this form to declare foreign status and potentially reduce tax withholding on U.S.-source income.

W-8ECI for Effectively Connected Income

When foreign individuals or entities receive income that is effectively connected with the conduct of a trade or business in the United States, the W-8ECI is the proper form to file. It allows them to avoid withholding and instead report the income on a U.S. tax return.

W-8EXP for Foreign Governments and Tax-Exempt Organizations

This form is designed for foreign governments, international organizations, and certain foreign tax-exempt groups. It allows these entities to certify their exemption from U.S. withholding tax on income such as interest, dividends, and royalties.

W-8IMY for Intermediaries

Financial institutions and flow-through entities acting as intermediaries submit the W-8IMY. This form facilitates the collection and transmission of withholding documentation from beneficial owners or other intermediaries further up the chain.

W-8BEN Benefits

Filing the W-8BEN accurately can result in significant tax savings and regulatory compliance. Here’s a breakdown of the specific advantages for foreign individuals.

Reduced Withholding Rates

Under U.S. tax law, payments to non-residents are subject to a 30% withholding tax unless reduced by a tax treaty. The W-8BEN allows individuals to claim these benefits by providing their country of residence and the specific article of the treaty.

Avoiding Double Taxation

For residents of countries with tax treaties in the U.S., the W-8BEN helps prevent double taxation. Without it, foreign individuals might pay tax to the U.S. and their home country on the same income.

IRS Compliance

Using the W-8BEN helps ensure IRS reporting compliance for payers. They may apply the full withholding rate or even refuse to process payments without the form.

How to Fill Out the W-8BEN Tax Form

Completing the W-8BEN requires accuracy and a clear understanding of each section. Mistakes can result in processing delays or incorrect tax withholding.

Part I: Identification of Beneficial Owner

• Line 1: Full legal name of the individual
• Line 2: Country of citizenship
• Line 3: Permanent residence address (must be outside the U.S.)
• Line 4: Mailing address (if different from Line 3)
• Line 5: U.S. taxpayer identification number (if applicable) or foreign tax ID number

Part II: Claim of Tax Treaty Benefits

• Line 9: Country with which the individual claims treaty benefits
• Line 10: Specify the article of the treaty that applies and the type of income
• Explain why the individual meets the terms of the treaty article

Part III: Certification

• The individual must sign and date the form and certify under penalties of perjury that the information is correct.

W-8BEN vs Other Types of W-8 Tax Forms

Each W-8 form targets a different taxpayer profile and type of income. This section highlights the key differences in a comparative table format.

Submission and Renewal Process

Submitting the W-8BEN involves sending the form to the withholding agent (such as a bank or investment platform), not the IRS. The form remains active for up to three years unless the individual’s status changes.

When to Submit

• When opening a U.S. brokerage or bank account
• Before receiving income subject to U.S. withholding
• Upon request by a withholding agent

Renewal Requirements

• Must renew every three years or sooner if circumstances change
• Failure to renew may result in full withholding (30%) on U.S. payments

Common Errors to Avoid

Incorrect filing can lead to delays, rejected forms, or excessive withholding. Here are some of the most frequent issues.

• Missing or Incorrect TIN: Providing the wrong taxpayer identification number, or omitting it when required, can cause the form to be invalid.
• Wrong Treaty Article: Many individuals fail to specify the correct treaty article or don’t explain why they qualify. This omission can lead to a denial of reduced withholding.
• Using the Wrong Form: Entities submitting the W-8BEN instead of the W-8BEN-E is a common mistake. Each form has a designated use based on taxpayer type.