We are paying a UK vendor for a U.S.-based training class. Their W-8BEN-E states they are a corporation and international organization, but they did not provide a TIN or GIIN number. Do we withhold 30% or are they exempt?


The new W-8 forms are confusing and have been generating a lot of questions. There are a couple of issues here.
If the vendor is recognized as an international organization, then its name should appear on the U.S. State Department’s published list of organizations exempt from federal tax reporting, including the United Nations, World Bank, and the World Trade Organization. You can check the list at this web address: www.state.gov/p/io/empl/126305.htm. An entity that qualifies as an international organization would fill out a W-8EXP instead of a W-8BEN-E, says Cyrus Daftary, CEO of Compliance Technologies International (www.cticompliance.com) and of counsel at Burt, Staples & Maner LLP (www.bsmlegal.com) international tax law and compliance firm.

It’s possible the vendor chose the international category out of uncertainty of its meaning, and is simply a non-U.S. entity. If that is the case, then the vendor was correct in filling out a W-8BEN-E and must provide you with some type of tax identification number, whether U.S. or foreign. That is not optional. Without some type of TIN, you have to withhold 30%.

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