Definition
The IRS form a person who is not a U.S. citizen or resident gives to a U.S. payer to confirm foreign status and, where a tax treaty allows, claim a lower withholding rate.
What it means
Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting, is completed by individuals who are not U.S. persons and receive income from U.S. sources, such as YouTube creators, authors or freelancers abroad. It is given to the company that pays you, not sent to the IRS. It confirms you are a foreign person and, if your country of residence has an income tax treaty with the United States, lets you claim a reduced rate of withholding, usually with your foreign tax ID number or a U.S. ITIN. Without it, a payer may withhold the full 30% rate or treat you as a U.S. person. The form generally stays valid until the last day of the third calendar year after you sign it, unless your details change. Companies and other entities use Form W-8BEN-E instead.
Example
A creator in India whose YouTube earnings from U.S. viewers are $200 in a month would have $60 withheld at 30% without a treaty claim; with a valid treaty claim at 15%, $30 is withheld.
Illustrative numbers only. Your situation will differ.
Related terms
Related on CentDaily
U.S. tax withholding calculator for creators outside the U.S.