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Certification Of No United States Activities or W-8BEN Certificate of Foreign Status ???

Discussion in 'Commission Junction' started by JJohn, Dec 24, 2009.

  1. JJohn

    JJohn Newbie

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    Ok, can someone clear this for me? Really...I searched through Google and found many people asking this question, but no clear answer.

    Im from Canada, and am a regular affiliate. Which one do I chose???

    Certification Of No United States Activities

    OR
    W-8BEN Certificate of Foreign Status
    !??!?!?!??!?!

    Why is there not a clear answer on this? Im not a company, I will most likely be using shared hosting from a company that will be some place in the USA, etc.. etc... YA KNOW, JUST LIKE 99% of other small affiliates that just don't live in the states.....

    SOOOOOOO.....can someone be kind enough to just tell me which one to chose please? I cant beleive how hard it is to find an answer to this question.

    Thanks in advance. I mean it.
     
  2. LightBurner

    LightBurner Newbie

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    Hi,

    I'm gonna post this message in several posts coz the system isn't allowing me to post it in one shot.

    I know this comes pretty late, nonetheless, here's what I found:

    The W8BEN form is only required to be filled out for US SOURCED income. Now "US Sourced" doesn't mean where the person writing the check is, it means where the work was done by the PAYEE.
     
  3. LightBurner

    LightBurner Newbie

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    The OECD (of which the USA is a member of) put it's head together many years ago and determined that if you OWN a webserver in a country, then the websites you have on that server are producing income SOURCED in that country. If you merely RENT a webserver in a country, the websites on it are producing FOREIGN SOURCED income.

    FOREIGN SOURCED income is NOT subject to tax in the USA and does NOT require form W8BEN to be filled out
    - W8BEN is for foreigners to claim exemption from withholding tax on US SOURCED INCOME for tax treaty obligations.
     
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  4. LightBurner

    LightBurner Newbie

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    The instructions for W8BEN are clear:

    "Who must file. You must give Form W-8BEN to the withholding agent or payer if you are a foreign person and you are the beneficial owner of an amount SUBJECT TO WITHHOLDING."

    As I said previously, FOREIGN SOURCED INCOME IS NOT SUBJECT TO WITHHOLDING.

    All that is required is that the foreign affiliate CERTIFIES they do not have any US-SOURCED income and are not a US Taxpayer, etc.

    Google has it SPOT ON, on their Adsense tax information page:

    just make a google search for "google adsense tax information" and the first link will be the right reference page.


    ********

    Non U.S. Business (No U.S. Activities )

    United States (U.S.) Activities involve having employees or owning equipment in the U.S. that are involved in any way with revenue earned through the AdSense programme. This includes, but is not limited to, owning a web server or owning a hosting service in the U.S., or having employees in the U.S. who are involved in either:

    * setting up a web server, hosting service, or website
    * developing content for your website
    * marketing to create a user base for your site
    * telephone support for your site
    * buying products for your site
    * maintaining your site

    Generally, utilizing an unrelated third-party U.S. web hosting service to host your web pages, renting web servers that are located in the U.S. from an unrelated third party, or having your payment sent to a U.S. Post Office Box or mail forwarding address, do not of themselves constitute U.S. Activities.

    If you do not have U.S. Activities, you will be asked to agree to a statement to that effect. No tax forms are required in this instance.
    ***********
    So in other words, if you don't have any employees working for you in the U.S. and if you don't own any equipment located in the U.S. (like servers for example), then you use the Certificate... otherwise (if you do have employees working for you IN the U.S. and/or if you own equipment located IN the U.S.), you should use the W-8BEN...

    I'm having the problem at LinkShare where they're trying to force down my throat the W-8BEN form and I'm coming back at them with prime examples that I don't need to fill that form coz it doesn't apply to me and that they should make a "Certification Of No United States Activities" available to me (and to any other person to whom it applies to). Coz what happens if you fill out the W-8BEN is that the keep 30% of your earnings. Now, knowing that and knowing that they don't have to give that form to the IRS, it makes me wonder if they wouldn't simply make a fake Certification for their paperwork in case the IRS checks that... and keep that 30% earnings in their pocket! Who knows!?

    I'm in Canada too and we already have our own taxes to pay, why would I subject myself to pay 30% taxes that I DONT HAVE TO PAY!?

    Anyway, hope this helps you understand a bit more! :)

    LB