W-8BEN Form
A U.S. tax form used by non-U.S. individuals to declare they are not subject to U.S. income tax on certain types of income.
What is W-8BEN Form?
The W‑8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding) is a U.S. tax form used by non-U.S. individuals to declare that they are not subject to U.S. income tax on certain types of income - including payments for freelance or contract work. If you're a U.S. company paying an international contractor, this form helps avoid backup withholding and ensures proper IRS reporting.
How it works
- Filed by: Non-U.S. individual (not companies - they use W‑8BEN‑E)
- Submitted to: The paying company or platform, not the IRS
- Purpose: Certify foreign status + claim reduced withholding under a tax treaty (if available)
- The form includes:
- Legal name and address of the contractor
- Country of citizenship and tax residency
- Foreign tax identification number (if required)
- Signature and certification
- Platforms like Sigma help contractors auto-generate W‑8BEN forms during onboarding and store them securely.
Why it matters
- U.S. companies that pay international freelancers or contractors must collect this form to avoid:
- IRS penalties
- 30% backup withholding
- Misclassification risks during audits
- It's especially relevant if you're using platforms like Upwork, Deel, or Sigma - all require this form as part of their compliance stack.
Example
A U.S.-based SaaS company hires a developer in India. During onboarding via Sigma, the developer fills out a digital W‑8BEN form. This allows the company to avoid tax withholding and stay compliant with IRS rules.
