How to complete the W-8BEN-E Form for Australian Companies

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The IRS seems to be over just making the life of Americans a misery and they have decided the whole world should experience their special attention. If you are a foreign business with no presence in the USA, but you have US customers, you need to complete and provide your customers with a copy of the W-8BEN-E Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities).

This form is eight long pages of IRSese with such easy to understand terms as “Nonparticipating FFI (including a limited FFI or an FFI related to a Reporting IGA FFI other than a registered deemed-compliant FFI or participating FFI)”. If anyone know what this means please post, because nobody at the IRS seems to know – at least nobody who answers the phones.

When faced with completing this form for the first time it is near impossible to know what you need to fill in and the IRS instructions are as clear as mud. To save other poor Australians the nightmare of completing the W-8BEN-E form here is my step-by-step guide for standard Australian companies (i.e. those owned and run by Australians) of what you need to do.*

*Disclaimer. I am not a USA tax lawyer or accountant! Use this guide as a starting point for knowing what you need to do and always consult a professional. Do not use these instructions if you are a US citizen or have a US company branch.

Edit. The IRS updated their form in 2016 so I have updated the instructions. Amazingly they have made the form even more complicated – there really is no form too complicated that the IRS can’t make it worse.

Edit 2. Once again the IRS has updated the form in 2017 and so the tread mill continues. I am sure everyone will be surprised to learn it is even more complex.

Step 1. Get the W-8BEN-E form
1. You can download the W-8BEN-E from the IRS website. If the form has moved then just google for it – the IRS seems to like to move forms around on their website fairly regularly.
2. Print out the form as it is easier to fill it in by hand and scan.

Step 2. Complete Part I
Question 1. Write your full business name (eg. “xyz pty ltd”)
Question 2. Write “Australia”
Question 3. Leave blank
Question 4. Tick “Corporation”
Question 5. Tick only “Active NFFE. Complete Part XXV”
Question 6. Write your registered business address in Australia
Question 7. Write your mailing address in Australia. If it is the same as 6. then just write “As Above”.
Question 8. Leave blank
Question 9a. Leave blank
Question 9b. For “Foreign TIN” write in your company’s ABN.
Edit. Technically, your company’s tax file number is the TIN, but some sources suggest that you supply your ABN, not TFN (others say TFN). I am much happier to supply people with my ABN rather than TFN. I suspect in the end it does not matter too much since the ATO has the ability to crossmatch your ABN and TFN – the whole point of this form is for the IRS and ATO to share data on company income.
Question 10. Leave blank.

That is the easy page 1 taken care of! Now to page 2.

Step 2. Complete Part III
Question 14a. Tick the check box and write “Australia”.
Question 14b. Tick the check box “The beneficial owner derives the item (or items) of income for which the treaty benefits are claimed, and, if applicable, meets the requirements of the treaty provision dealing with limitation on benefits. The following are types of limitation on benefits provisions that may be included in an applicable tax treaty (check only one; see instructions):”
On the 14b. sub-question choose: “Company with an item of income that meets active trade or business test”. This is assuming most of your business activity is in Australia.
Question 14c. Leave blank
Question 15. Write “Article 7, Paragraph 1” for the claiming provisions line; “Zero” for the % rate; and “Business Profit” for the type of income line. For the explanation write “Australian entity with no US permanent establishment deriving business profit not subject to withholding tax under the USA-Australian tax treaty. Skip to page 7.
Edit. For non-Australian companies you should be able to find the corresponding article number for your country’s tax treaty with the USA (the treaties are all listed on the IRS website). You will need to read through your tax treaty to find the right article to use (look for the article concerning “business profit”). For example, in the UK-USA tax treaty the article number is the same as Australia’s (Article 7).

Step 3. Complete Part XXV
Question 39. Tick the check box (assuming the three points are true which should be the case if you are a standard Australian company).
Skip to page 8.

Step 4. Complete Part XXX
Sign the form, print your name, and write the date with dashes. Don’t forget to use the crazy USA system of putting the month first.
Tick the box that says that you have the capacity to sign (assuming you do).

Step 5. Scan
Scan the document. To keep the size manageable scan it as a B&W document at 200 dpi and save as a pdf file (it should be under 500 KB). You can then email this when you send invoices to your USA customers. The form is supposed to be valid for 3 years.

/s Now wasn’t that simple! Thank you IRS for making this form so easy and providing such clear and simple to follow instructions /s.

196 comments on “How to complete the W-8BEN-E Form for Australian Companies
  1. Thanks for that. Will this do for a trustee company itf a family (discretionary) trust? What about an SMSF?

  2. Just found your instructions and even though I am in Canada, they proved to be invaluable. I have a university degree and still I couldn’t figure out how to complete the form. It’s absolute lunacy!! Thank you for saving me hours of research and anguish.

  3. Ah, I see now that you need to be a university PROFESSOR to wade through the form – not just a university graduate. Thx again

  4. Daniel, you are a life saver – we have just won a contract to a USA company and this is a huge help. MANY THANKS

  5. Daniel I don’t know what to say other than THANK YOU. You have given us the best Christmas present ever.

    Merry Christmas and a Happy New Year

  6. After a couple of useless calls to Pay Pal I did get the advice to google up W-8BEN-E instructions. Voila! Daniels advice stood out like a beacon in the impenetrably dense fog of the American IRS compliance requirements. Hurrah!… and thanks

  7. Brilliant stuff! Helps me with my immediate task and also gives me insights as to why the US IRS needs serious reform!

  8. Thank you so much for helping us navigate this dross – but shouldn’t 14b have a sub checkbox ticked, e.g. “Company that meets the ownership and base erosion test”?

  9. Gordon – this might be another change to the form. I will have to take a look.

    Edit. It looks like it is actually “Company with an item of income that meets active trade or business test”.

  10. Thank you so much, Daniel, for your step-by-step instruction, which saved me a lot of time. I highly appreciate your efforts to facilitate life of everybody having to deal with the same challenge.

  11. Thank you so much for posting this. I have wasted several hours trying to understand the Form W-8 instructions which make no sense at all.

  12. Hi Daniel,
    If our Company pays US tax so we have an TIN do we still fill in the form the same way? more than 50% of our income is from the US as Dividends.
    Thanks
    Margaret

  13. Margaret you are going to have to talk to an accountant with experience dealing with the US tax rules as this is way beyond what I can comment on.

  14. Hey Daniel, Thanks for doing this! It’s tax time and I needed some of this for investors in our film. My question is, do you think your suggestions to filling out the W-8BEN-E applies to anyone foreign? The Japanese, for instance? I would think so, but just double checking.

  15. Hi Erica

    Yes they probably do apply to Japanese. There is a section in the post about how to look this up, but it is not something that I have looked into personally.

  16. Thank you for taking the time to share your findings on this. In the hope of helping others in New Zealand it appears that Article 7, Paragraph 1 is the same reference required in the NZ treaty.

  17. That is good to know. I suspect it will be the same clause for most countries, but I have not bothered to look into this.

  18. Well played, sir! A really good resource for companies, trusts and smsf is the guide published by Macquarie Bank – that may add to this for your readers.

  19. Thank you very much Daniel! Your instructions were clear, useful and saved me a headache :-)
    I’m extremely happy I found them.

  20. p.s. I used this to help me complete the Substitute Form W-8BEN-E when filling in tax details for selling an app in the apple App Store. In case any one is searching for help with that in particular :) It is very similar except apple have removed a few unnecessary fields.

  21. You have saved me from a month of being curled up in the foetal position, sucking my thumb and crying like a child. Thank you!

  22. Brilliant! We have spent a painful week trying to make sense of this form and woke up this morning to an email from USA to say we had still got it wrong. Out of nowhere we stumbled upon your advise and have followed it word for word, box for box, tick for tick! Thank you so so SO much for sharing.

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