Form W‑8BEN & W‑8BEN‑E India: Complete Guide for Filing and Key Differences

If you or your business earns income from U.S. sources, you might be familiar with the W-8BEN and W-8BEN-E forms. 

In India, Form W-8BEN and W-8BEN-E help you gain tax treaty benefits when conducting business in the U.S. Both these forms directly impact how much tax is paid on any U.S.-sourced income. Not only do you avoid unnecessary withholdings, but you also ensure compliance with U.S. regulations. 

In this article, we’ll explain both forms, the differences between the two, and how to complete them. Let’s get started.

• Forms W-8BEN and W-8BEN-E are IRS tax forms filed by Indian individuals and businesses. These include freelancers, investors, SaaS exporters, D2C brands, and more. With these forms, filers can certify their non-U.S. status and take advantage of tax treaty benefits on U.S.-sourced income.

• Form W‑8BEN is a one-page form for individuals like freelancers and investors. Form W‑8BEN‑E, used by entities such as Indian companies or partnerships, is longer and more complex. Both are valid for three years and have to be submitted to the U.S. withholding agent.

• These W-8 forms help claim tax treaty benefits, reduce or eliminate any withholding tax, and ensure compliance with IRS and U.S. regulations, when receiving payments from American clients, platforms, or financial institutions. Failure to submit the correct W‑8 form can result in a flat 30% tax withholding on U.S. income.

Forms W-8BEN and W-8BEN-E are IRS forms in the U.S. that are filed by non-U.S. individuals and businesses, including those in India, to certify their non-U.S. status and claim tax benefits on U.S.-sourced income. The W-8BEN is meant for individuals, while businesses file the W8-BEN-E. These forms reduce withholding tax and help avoid instances of double taxation.

The W‑8BEN and W‑8BEN‑E are official U.S. tax forms issued by the Internal Revenue Service (IRS). They are intended for individuals and businesses without U.S. citizenship who have a revenue stream in the U.S. The W-8 form requires information on who the individual or business is, their residency, and the types of income.

The W-8 forms, when filled and filed as required, achieve the following:

1. Certify that form filers are not U.S. residents for tax purposes
2. Declare ownership of the income
3. Help claim reduced tax rates under applicable tax treaties (like the one between India and the U.S.)

There are 5 types of W-8 forms – but in this article, we’ll zoom in on forms W-8BEN and W-8BEN-E.

When earning income from the U.S., a failure to file the relevant W‑8 form can lead to a 30% withholding tax.

Properly filing W‑8BEN or W‑8BEN‑E allows you to reduce this withholding tax (e.g., from 30% to 0% or 25%). Other benefits of filing them include avoiding double taxation under the India-U.S. tax treaty, maintaining IRS compliance, and continuing to receive payments from U.S. sources, as well as preventing any payment delays or rejections from your clients.

The eligibility criteria for filing the forms W‑8BEN or W‑8BEN‑E is as follows:

1. If you’re earning income from U.S. sources, or
2. If you are a freelancer or consultant based in India and working for U.S.-based clients, or
3. If you’re an individual investor receiving dividends from U.S. stocks.

For example, if you run a business based in India that sells a software service in the U.S., you are earning U.S.-sourced income, requiring you to file the W-8BEN-E.

Here’s a table quickly covering the required form, based on the type of income and who needs to file it:

Here’s the key pointer: if you’re an individual, use W‑8BEN. If you’re a business, W‑8BEN‑E is more relevant.

Form W-8BEN is filed by Indian individuals, such as freelancers and investors, while Form W-8BEN-E is for entities, including companies or LLPs. W‑8BEN is a simpler form, whereas W‑8BEN‑E is more complex. Both require a PAN, are valid for three years, and help claim U.S. tax treaty benefits.

For Indian individuals of businesses filing the W-8BEN or W-8BEN-E, there are some particular differences to be kept in mind. These are listed in the table below.

The next step is learning how to fill out these forms correctly. Let’s start with the W‑8BEN.

1. To fill Form W‑8BEN in India, provide the required information including your name, Indian address, PAN, and date of birth. Claim tax treaty benefits under Article 15 or 10, based on income type. Sign and date the form clearly without corrections. Be attentive! This will help avoid rejection of the form.Attention-to-detail is essential to avoid rejection of the form.

The form can be filled in three parts. Let’s look at each.Filling out the W‑8BEN is straightforward, but accuracy is critical. Let’s go through the process and fill in the form in three parts.

Part I: Personal Information

• Line 1: Full name (as per passport)
• Line 2: Country of citizenship (India)
• Line 3: Permanent address in India (no U.S. addresses allowed)
• Line 4: Mailing address (if different from the permanent address)
• Line 5: Leave blank, unless you have a U.S. TIN
• Line 6: Your PAN number
• Line 8: Date of birth in MM-DD-YYYY format

Part II: Tax Treaty Benefits

• Line 9: Write “India” as your country of residence
• Line 10: Write as follows:
• Freelancers: “0% rate under Article 15”
• Investors: “25% rate on dividends under Article 10”

Part III: Certification

• Sign exactly as per your ID documents, and date the form
• Do not use correction fluid/whiteners or make handwritten changes

Some general tips here are to use clear handwriting, and avoid making corrections or alterations. Start with a fresh form otherwise.If that is the case, start with a fresh form. 

W‑8BEN and W‑8BEN‑E forms have to be submitted to your U.S. client or platform and not the IRS. Best practice is to submit the forms before receiving any payments, using separate forms for each income source, and confirming the submission format. Following up after submission and keeping well-maintained records can be helpful steps, too.

The W-8 forms, although sourced from and issued by the IRS, are to be sent to the U.S. withholding agent. A withholding agent can be the person paying for your goods or services, a company or partnership, or a financial institution like a bank, responsible for managing your accounts.

Here are direct links to both forms for your perusal:

• Official IRS W‑8BEN form (PDF)
• Official IRS W‑8BEN‑E form (PDF)

The submission process can be made frictionless if you keep in mind the following:

1. Submit the form before receiving any U.S. payments to get the timing right.
2. Ensure that you have separate W-8 forms in place for each of your U.S. clients/platforms, as mandated. Further, different types of income ask for different types of forms as well.
3. Confirm the format of form submission with your withholding agent beforehand to avoid any unnecessary delays.
4. Inform your withholding agent of any errors in the form within 30 days of the submission.

After submission, it’s ideal to follow up with clients to enquire if there are any questions or issues to be resolved. Keeping organized records. Compliance and renewal will become a lot easier.for your form submissions is also recommended, as they can make compliance and renewal a lot less of a burden.

With these tips in place, we can move on to common filing mistakes.the errors commonly seen in W-8BEN and W-8BEN-E submissions, and how to avoid them.

To file Form 10F online, visit the Income Tax Portal online. Register or log in, and navigate to ‘File Income Tax Forms.’ Select Form 10F, enter the requested details, upload your TRC, and use the DSC or EVC for verification. Then, submit and save the acknowledgment receipt. 

For a more detailed breakdown, here is the step-by-step process:

1. Visit the Income Tax Portal: https://eportal.incometax.gov.in
2. Register or log in. Non-residents without PAN can register by selecting “Others > Non-resident not holding PAN.”
3. Navigate to Income Tax Forms > e-File > File Income Tax Forms
4. Select the tab "Person not dependent on any source of income"
5. Find Form 10F and click "File Now"
6. Choose the assessment year, enter your PAN, and click "Continue"
7. On this page, enter the required details. These include:

• Name, nationality, TIN
• Filing under Section 90 or 90A
• Country of residence and TRC period
• Address in foreign country

1. Upload TRC and any other documents requested on the website. 
2. Check that you have accurately entered the requested data.Review your entries for accuracy
3. Verify your submissions with either the electronic verification code (EVC) or digital signature (DSC)
4. Submit and save the acknowledgment receipt for your records.

With this, you have successfully submitted your Form 10F.