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ITIN NEWS BLOG

News & Tips from an ITIN Acceptance Agent

W-8BEN - UK/US Tax Treaty


Just Breve - W-8BEN - UK/US Tax Treaty
Just Breve - W-8BEN - UK/US Tax Treaty

To stop double taxation with the US, the UK and US have a tax treaty in place.


You will need to complete a W-8BEN for a UK/US Tax Treaty claim to stop additional tax being taken from your payment. You will need to ensure the relevant fields are completed correctly for the US income type you are receiving and also ensure the form is completed every 3 years, else it expires.


The W-8BEN is not a complex form to complete and consists of several parts to the form that need entries for it to be complete.


The W-8BEN is for individuals only.


Do not fill in the form if:

- You are NOT an individual

- You are a U.S. citizen or other U.S. person, including a resident alien individual

- You are a beneficial owner claiming that income is effectively connected with the conduct of trade or business within the United States (other than personal services)

- You are a beneficial owner who is receiving compensation for personal services performed in the United States

- You are a person acting as an intermediary


If you are an individual you can easily complete the form as follows:


Part I - Identification of Beneficial Owner

Line 1- enter the full name of the beneficial owner of the income

Line 2 - add your country of tax residence (in full not abbreviated)

Line 3 - Add you permanent residence address in your tax residence country

Line 4 - add your mailing address if different to line 3

Line 5 - add you ITIN if required (see below) - an ITIN is not required for most W-8BEN form completions

Line 6a - add your tax identification number in your home country. The US call this an FTIN (i.e. UK national insurance number)

Line 6b - if your home country does not legally require an FTIN - tick the box

Line 7 - add the reference number if you have one from the US payor (e.g. for a bank account)

Line 8 - add your date of birth in US date format (MM/DD/YYYY)


Part II - Claim of Tax Treaty Benefits


Line 9 - enter the country you are tax resident of (and the US has a tax treaty with)

Line 10 - enter the relevant Article and paragraph for the type of income you are claiming for reduced US tax benefits:

e.g. Dividends - Article 10 - 15% (UK/US)

e.g. Bank interest - Article 11 - 0% (UK/US)

e.g. Royalties - Article 12 - 0% (UK/US)


You need to also explain the additional conditions in the Article and paragraph the beneficial owner meets to be eligible for the rate of withholding:


- I am tax resident of the United Kingdom and per Article 11, bank interest is taxed at 0% tax per the UK/US tax treaty. Tax is paid on the bank interest in my home country of the United Kingdom


You would then need to sign and date the W-8BEN and provide it to the US payor of the income.


I have been told I need an ITIN to complete the W-8BEN - but I do not have one?


No this is not the case in the majority of tax treaty claims. You would only be required to have an ITIN in limited circumstances (e.g. receiving an inheritance or performing services in the US). You do not need an ITIN if you are a remote worker or if you receive just interest, dividends or royalties.


You would also need to have an ITIN to file a tax return, but this would be because the US payor held too much tax and you are claiming a REFUND. If the correct tax is held or None (per the treaty), then no tax filing and no ITIN is required.


My W-8BEN expired and I didn't know. 30% tax was held, what now?


As above, you would need to file a 1040NR US tax return and apply for an ITIN to reclaim the tax. The US payor would have issued a tax withholding document to you (1042-S or 1099). Just Breve assists clients regularly with this. If you require assistance in making a tax claim, please contact us today:


Tel: 0208 1444632


If you need help completing a W-8BEN we can also assist for a reasonable nominal fee.


Please note, you only have 3 years from the return due date to make a claim for the refund. If you do not, the refund is lost.










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