How-To Guides

How can Pakistani’s fill the W8-BEN form

Developers or freelancers who work with U.S clients will often get asked to fill out the W8-BEN form. Since the IRS website can be a bit wordy, here’s an explanation for what the form is, who needs to fill it out, and how you can go about doing that.

What is the W-8BEN

The Form W8-BEN, is filled out only by non-U.S companies or workers. Basically, if you aren’t a U.S tax payer, you are still subject to tax on certain kinds of income. This is usually a flat rate of 30%. A large amount of money. How do they charge you this amount? Essentially, if you work for a company based in the U.S, they will be liable to pay that 30% to the IRS, therefore, they will withhold that income before paying you the remaining amount. The U.S and Pakistan have a tax treaty – which you will mention in the form – that lowers this rate for most incomes earned.

Who Needs to Fill Out the W8-BEN

Since the W8-BEN is only applicable for certain kinds of income, you need to know whether or not it is a requirement for you. Talk to the company you are working with, and ask them if they need you to fill out the form.

Here is a list of incomes that require you fill out the W8-BEN:

  • Certain kinds of interest,
  • Dividends,
  • Rents,
  • Royalties,
  • Premiums,
  • Annuities,
  • Compensation for, or in expectation of, services performed,
  • Substitute payments in a securities lending transaction, or
  • Other fixed or determinable annual or periodical gains, profits, or income.

The form is valid for 3 calendar years. Make sure you keep your form updated with whatever company requires it.

Guide to Filling out the W8-BEN

Don’t worry, it’s not a complicated form. The form is a simple one-page document, with three parts.

Part 1

This part doesn’t require you to fill out every line. You will need to fill out:

  • Name
  • Country of Citizenship
  • Permanent Residence Address
  • Mailing Address (if different from above)
  • Date of Birth

You can leave the remaining lines blank. I believe you can fill, and file, the form without an ITIN. You should confirm this with the company asking you to fill the form.

Part 2

Since Pakistan has a tax treaty with the U.S, you will be able to reduce the amount of taxes that are withheld from your earnings. Basically the treaty outlines the taxes levied on Pakistanis doing business in the U.S. This includes royalties, services provided. Please read the document thoroughly the understand the rate applicable to you. You will then provide this information in Part 2 of the W8-BEN.

Part 3

Sign the form, add your name and date.

Important Links

IRS Guidelines for filling W8-BEN

Link to W8-BEN

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