Form W-8 BEN - Everything you need to know

If you’re an Indian firm serving U.S.-based clients or platforms, you've likely been required to provide a tax form before payment. That form typically is one of the W-8 series, most likely the W-8BEN if you're an individual or the W-8BEN-E if you're an entity.

These forms are an integral part of transacting with U.S. businesses and serve to certify that you are a non-U.S. person. Without them, your payments could be delayed or overtaxed.

Here, we explain what W-8 forms are, who has to file them, how to select the proper one, and how to complete and file them properly.

W-8 forms are certificates provided by the U.S. Internal Revenue Service (IRS) to confirm that a non-U.S. person or company is not liable for U.S. tax on specific types of income.

Examples of income include:

• Interest (such as certain original issue discount (OID))

• Dividends

• Rents

• Royalties

• Premiums

• Annuities

• Compensation for, or in anticipation of, services performed

• Substitute payments in a securities lending transaction

• Other fixed or determinable yearly or periodic gains, profits, or income

W8 forms constitute a statement that the income recipient is not a resident of the United States and is consequently entitled to receive limited withholding tax rates or exemptions under their respective tax treaties.

If you have U.S. sources of income, by default, they have to withhold 30% of your payments. However, India and the U.S. have a Double Taxation Avoidance Agreement (DTAA), under which Indian residents can claim lower tax rates on various forms of U.S. income by completing the correct W8 form.

Without the form: You lose 30% upfront.

With the form: You may only be taxed 10%, 15%, or even 0%, depending on your income type.

Here’s a complete breakdown of W-8 forms and who should use them:

Still unsure?

If you're an Indian freelancer, W-8BEN is likely the right form. If you're an Indian company, W-8BEN-E is usually required.

Here's a quick rundown to help you make out the two most popularly used forms: W-8BEN form for individuals and W-8BEN-E form for entities.

Now that you have an idea of what a W8 form is and why it is important, let's discuss who must actually file the most frequently used one: the W-8BEN form.

You must file a W-8BEN form if:

• You are an individual (not a corporation).

• You reside in India.

• You earn specific kinds of income from U.S. sources like dividends, royalties, interest, or freelance work.

• You don't have a U.S. business presence.

The W‑8BEN confirms your non‑U.S. status and lets you claim India–U.S. tax treaty relief to minimize or exempt withholding tax on your payments.

Examples:

1. Bengaluru freelancer: Develops websites for U.S. clients and uses W‑8BEN to prevent 30% tax on payments.

1. Hyderabad YouTuber: Files W‑8BEN with Google AdSense to minimize tax on U.S. viewer ad revenue.

1. Author in Pune: Licenses her book to a U.S. publisher and submits W‑8BEN to reduce tax on royalty income.

As per the India–U.S. tax treaty, some forms of income are eligible for reduced withholding rates. For instance:

• Royalties: 10%

• Technical Services: 10%

• Dividends: 10-20%

• Interest: 10%

These benefits can be availed only with a correctly completed W-8BEN form.

The W-8BEN form is just one page, but includes critical fields. Here’s the complete breakdown:

PART I – Identification of Beneficial Owner

1. Name of Individual – Use the exact name from your passport/PAN
2. Country of Citizenship – India
3. Permanent Residence Address – Your Indian address, no P.O. boxes
4. Mailing Address – Optional if same as above
5. Foreign Tax Identifying Number (FTIN) – Enter your PAN
6. U.S. TIN – Leave blank unless you have an ITIN or SSN
7. Reference Number(s) – Optional; some platforms use this to tag your account

PART II – Claim of Tax Treaty Benefits

• Tick the box to claim treaty benefits
• Country: India
• Article and Paragraph: Usually Article 12 for royalties/services
• Type of income: Describe (e.g., freelance services)
• Explain: "The beneficial owner is a resident of India under Article 4 of the treaty."

PART III – Certification

• Read carefully
• Sign the form by hand (no digital signature)
• Enter your full name and date

Tips to keep in mind:

• Double-check the spelling of your name and address
• Mail, fax, or email your signed W‑8 form to your U.S. client/platform or their agent according to their exact submission process, not to the IRS.
• Keep a copy for your records

If you're offering products or services to U.S. customers as an Indian-registered entity, you'll probably be required to file the W-8BEN-E, the business equivalent of the W-8BEN form. It does pretty much the same thing, claiming non-U.S. status and allowing treaty benefits, but has more comprehensive reporting requirements.

You require W-8BEN-E if:

• You are a Pvt Ltd, LLP, or partnership in India
• You supply services, software, or products to U.S.-based organizations

What you’ll need:

• Legal name of the entity
• Country of incorporation
• Business address
• Global Intermediary Identification Number (GIIN) (if applicable)
• Chapter 4 status (e.g., Active Non-Financial Foreign Entity (NFFE))
• Treaty Article and Paragraph
• Foreign TIN (usually PAN of the business)

The W-8BEN-E is more extensive and comprises several parts, depending on your entity type and Foreign Account Tax Compliance Act (FATCA) status. If you are not certain which sections are applicable to you, a guided tool or tax advisor can be consulted.

Once you’ve figured out which W8 form applies to you, the next step is knowing when to submit it—and how. 

When to submit

1. When onboarding a new U.S. client
2. Before your first payment is processed
3. Every 3 calendar years (or earlier if your information changes)

How to submit

• Direct submission to the withholding agent or payer
• Some platforms have built-in form submission portals.

No need to send forms to the IRS unless explicitly requested. U.S. payers retain the form in their files in case of an IRS audit.

Not filing the W8 form has some severe, short-term, and long-term implications.

Suppose you don't file the W-8BEN form. Here's what you stand to lose:

1. 30% withholding tax on every payment

American companies are bound by law to withhold 30% of your gross income if they don't have a legitimate W8 form in hand. That's not income tax, this is a straight cut from every bill, no matter what your true profit is.

2. Client delays or cancellations

Most clients and platforms won't even accept payments until they have a valid W8 form. This can be frustrating, as it leads to excessive back-and-forth, delayed payouts, or even lost business if the client wants to work with someone who is already in compliance.

3. No access to treaty benefits

The India–U.S. tax treaty provides significant relief, but only if the IRS knows you’re eligible. Filing the correct W-8 form is the first and only way to claim reduced rates on eligible income types like royalties, services, or digital products.

4. Harder compliance audits and payment reconciliation

Skipping tax forms can be expensive, and it also causes paperwork hassles. If you're audited, or if your income is detected by accounting platforms or regulators, you’ll be missing critical documentation to prove that taxes were handled correctly.

What’s worse?

If you do end up claiming that 30% later, your only choice is to complete a U.S. non-resident tax return (Form 1040NR). That can be a time-consuming and technical process, and in many cases, it is not worth the effort unless a lot of money is at stake. You may even have to pay a cross-border tax adviser a fee in addition to the deduction.

For long-term compliance and global growth, W-8s are just as important as your invoices.

Indian companies serving international customers, particularly in the U.S., require sound infrastructure, regulatory certainty, and end-to-end visibility.

While W‑8 forms such as the W‑8BEN or W‑8BEN‑E need to be filed directly with U.S. clients or platforms, Xflow takes care of everything after that, ensuring everything goes seamlessly and compliantly.

Global business shouldn’t come with local hassles. With Xflow, you get a robust cross-border infrastructure designed for scale, speed, and compliance. From receiving accounts to payment links and invoicing, we take complexity out of the way so you can focus on growth. Sign up today and go global beyond limits.