FATCA Update - Updated Information for form W-8BEN-E
12 June 2017
Operational Tax News
On 24 May 2017, the IRS has issued an update of the form W-8BEN-E, Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Rev. April 2016), that supplements the form and provides additional information for foreign persons submitting the form.
The update highlights some of the modifications introduced by the final and temporary regulations under chapters 3 and 4 of the Internal Revenue Code issued by the IRS on January 2017.
The main points of the update can be summarized as follows:
- Foreign TINs: foreign account holders of a financial account held at a US office of a financial institution that receives US source income must provide the taxpayer identification number (TIN) issued by its tax residence’s jurisdiction on line 9b of the form. Nevertheless, the TIN can be omitted when:
(a) It has not been issued a TIN,
(b) The jurisdiction does not issue TINs, or
(c) The foreign person is a government, central bank of issue, international organization, or resident of a US possession.
In this case, the foreign person should provide the withholding agent with an explanation of why the TIN has not been issued on a separate attached sheet to the form W-8BEN-E or specify it in the margins of the form.
- Sponsored FFI, Sponsored Direct Reporting NFFE, and Nonreporting IGA FFI GIINs: as already informed in previous alerts, since 1 January 2017, a sponsored FFI that is a registered deemed-compliant FFI and a sponsored direct reporting NFFE, is required to obtained its own GIIN. The GIIN of the sponsored entity is reported on line 9a of form W-8BEN-E, but the GIIN of the sponsoring entity is no longer required to be entered on line 16 or 42. In addition, a Nonreporting IGA FFI (such as a Luxembourg-domiciled sponsored investment entity) that is a sponsored investment entity or controlled foreign corporation is no longer required to provide the GIIN of its sponsoring entity.
- Expiration of limited FFI and limited branch statuses: as limited FFI and limited branch statuses expired on December 2016, the reference to limited FFIs in line 5 should be disregarded. In addition, “branch treated as nonparticipating FFI” should be substituted for “limited branch” in line 11.
- Certain investments entities that do not maintain financial accounts: the wording in line 5 Part IX “certified deemed-compliant investment advisors and investment managers” will change to reflect its new name: “certain investment entities that do not maintain financial accounts.”
- Electronic signatures: As included in the temporary regulations, Chapter 3 provides the possibility for electronically signed withholding certificates.
More information on this update can be found in the IRS update.
Should you have any questions regarding the above, please do not hesitate to contact us.