W-8BEN vs W-8BEN-E: Which form do Indian investors need?
Every Indian investing in U.S. stocks or earning income from the U.S. faces one early question. Should you file W-8BEN or W-8BEN-E? Pick the wrong form, and your broker may reject it outright. Worse, the IRS could withhold 30% of your income instead of the reduced treaty rate.
The answer depends on one thing — whether you invest as an individual or through an entity. This guide breaks down the individual vs entity W-8BEN decision so you can file with confidence.
What is Form W-8BEN?
Form W-8BEN is a one-page IRS document designed for foreign individuals. It serves three purposes. First, it confirms you are not a U.S. taxpayer. Second, it establishes you as the beneficial owner of the income. Third, it lets you claim a lower withholding rate under the India-US Double Tax Avoidance Agreement (DTAA).
If you are an Indian resident investing in U.S. stocks through a brokerage, this is likely the form you need. The same applies if you freelance for U.S. clients or receive royalties from American companies. You fill in your name, address, Indian PAN, country of tax residence, and the relevant treaty article. Most brokerages walk you through it during onboarding.
The current version is the October 2021 revision and remains valid through 2026. Once signed, it stays active until December 31 of the third calendar year after signing. A form signed in March 2025, for example, expires on December 31, 2028.
What is Form W-8BEN-E?
Form W-8BEN-E is the entity counterpart. It runs eight pages with thirty parts, though most filers only complete a handful of sections. Foreign corporations, partnerships, LLPs, trusts, and other non-individual entities use this form to declare their status for U.S. tax withholding and FATCA reporting.
W-8BEN-E for companies in India is common when a Pvt Ltd company earns dividends from U.S. holdings or receives payments from American clients. The form requires entity classification under U.S. tax rules, a FATCA status declaration, and, if applicable, treaty benefit claims. An authorised officer or director signs on behalf of the entity.
The complexity comes from two mandatory classifications. You must declare your Chapter 3 status (corporation, partnership, trust, etc.) and your Chapter 4 FATCA status (Active NFFE, Passive NFFE, or a type of financial institution). Most Indian operating businesses qualify as Active NFFE — meaning less than 50% of their income is passive.
Which form Indians need: A quick-reference guide.
The decision tree is straightforward. Ask yourself one question: Am I receiving thisU.S.S income in my personal name or through a registered entity?
Indian individual investors, salaried professionals with U.S. income, and freelancers all use W-8BEN. Indian Private Limited companies, LLPs, partnership firms, One Person Companies, and trusts all use W-8BEN-E. The form you need has nothing to do with the size of your investment or the type of income. It depends entirely on whether you are a person or an entity.
Here is a breakdown by common Indian investor profiles. A salaried individual buying Apple shares through a U.S. brokerage submits a Form W-8BEN. A Bangalore-based IT company that receives consulting fees from a U.S. client files Form W-8BEN-E. A family trust holding U.S. ETFs files W-8BEN-E.
Once you know which form applies to you, follow our step-by-step guide to filling out the W-8BEN and W-8BEN-E forms for line-by-line instructions.
Key differences explained
Beyond the "who files" distinction, several practical differences matter.
Form length is the most obvious gap. W-8BEN is a single page with three parts. W-8BEN-E spans eight pages with thirty parts, though you typically complete only Parts I, III, one FATCA-related part, and Part XXX for certification. The entity form demands far more detail because the IRS needs to understand entity classification for W-8 forms under both Chapter 3 and Chapter 4 of the Internal Revenue Code.
Treaty benefit claims also differ in structure. On W-8BEN, you fill Lines 9 and 10 in Part II — entering "India" as your treaty country and citing Article 10 for dividends. On W-8BEN-E, treaty claims appear in Part III, Lines 14 and 15. Entities must additionally satisfy a Limitation on Benefits (LOB) test, proving they genuinely qualify for treaty protection rather than being shell structures.
The identification requirements are similar but not identical. Both forms require a Foreign Tax Identification Number — your Indian PAN for W-8BEN or the entity's PAN or TAN for W-8BEN-E. Without a valid PAN, treaty benefits are typically denied, and the full 30% withholding rate applies.
Both forms have a validity period of three calendar years. Neither form gets filed with the IRS. You submit both directly to your withholding agent — usually your U.S. broker, bank, or the company paying you.
Entity classification under W-8BEN-E
Entity classification W-8 forms require careful attention because the IRS uses U.S.U.S. tax principles, not Indian legal definitions. An Indian LLP, for instance, is classified as a "Partnership" under U.S. rules even though it has features of a corporation under Indian law.
Here is how common Indian entities map to U.S. classifications. A Pvt Ltd or Public Ltd company selects "Corporation." An LLP or traditional partnership firm selects "Partnership." A family trust selects "Simple Trust" or "Complex Trust" depending on its distribution requirements. An estate selects "Estate."
The FATCA classification adds another layer. Most Indian businesses that generate active income—IT services, manufacturing, and consulting — qualify as Active NFFEs. This means they complete Part XXV of the form. Passive investment holding companies may fall under Passive NFFE, requiring disclosure of substantial U.S. owners in Part XXIX.
Getting the Chapter 3 and FATCA classifications wrong can trigger withholding at the full 30% rate or flag compliance issues. When in doubt, consulting a tax professional is worth the cost.
The HUF question: Which W-8BEN form for HUF?
Hindu Undivided Families create a unique challenge because HUFs have no direct equivalent in U.S. tax law. The IRS has not issued formal guidance on which W-8BEN form for HUF entities as of February 2026, leaving this partly in grey territory.
Under U.S. entity classification rules, the answer depends on the HUF's primary purpose. If the HUF exists mainly to protect and conserve family property for beneficiaries — the most common scenario — it would likely be classified as a foreign trust. The Karta acts as the trustee, and the coparceners are the beneficiaries. In this case, the HUF files W-8BEN-E with "Simple Trust" or "Complex Trust" as its Chapter 3 status.
If the HUF actively carries on business operations, it could be classified as a partnership under U.S. tax principles. Either way, W-8BEN-E is the correct form, not W-8BEN. The HUF is not an individual, so the individual form does not apply.
Given the complexity, HUFs investing in U.S. markets should engage an international tax advisor to determine their classification before filing.
W-8BEN or W-8BEN-E for sole proprietors
This trips up many Indian freelancers and small business owners. The question of W-8BEN or W-8BEN-E for a sole proprietor has a clear answer — use W-8BEN.
A sole proprietorship is not a separate legal entity. The IRS treats it as a "disregarded entity," meaning the individual behind it is the actual taxpayer. The IRS instructions for W-8BEN explicitly state that the owner of a disregarded entity must submit the individual form.
You file W-8BEN in your personal name, not your business name. Use your personal PAN as the Foreign TIN. Claim treaty benefits under your own tax residency. This applies whether you run a small design studio, a freelance writing business, or any other sole proprietorship earning US-source income.
The only exception is extremely rare: a sole proprietor operating through a hybrid entity structure that claims specific treaty benefits. For the vast majority of Indian sole proprietors, W-8BEN is the right and only choice.
Beyond choosing the right form, understand the full tax implications for Indian residents investing in the U.S.U.S. stock market, including capital gains, foreign tax credits, and ITR filing.
WhenW-8BEN-E is required
W-8BEN-E becomes mandatory the moment US-source income flows to a registered entity rather than an individual. Common scenarios for Indian entities include a Pvt Ltd company receiving software licensing fees from a U.S. firm, an LLP earning consulting revenue from American clients, a partnership firm holding U.S. mutual fund units that pay dividends, and a trust or HUF investing in U.S. stocks or bonds.
The trigger is not the income type — it is the recipient's legal status. Dividends, interest, royalties, service fees, and any other US-source payment made to a non-individual foreign entity require W-8BEN-E.
Timing matters as well. Most withholding agents require the form before they release the first payment. If you delay, expect 30% withholding on every dollar until a valid form is on file. Some platforms allow retroactive claims, but recovery is slow and paperwork-heavy.
Filing requirements comparison
Both forms follow similar filing mechanics with a few important differences.
Submission goes to your withholding agent — your U.S. brokerage, bank, or client — never to the IRS. Both forms use the same October 2021 revision currently in force. Both expire on December 31 of the third calendar year after the signing date. Both must be updated within 30 days of any change in circumstances, such as a change in tax residency or entity structure.
The key practical difference is effort. W-8BEN takes most Indian individuals five to ten minutes with PAN and address details ready. W-8BEN-E can take significantly longer because of entity classification requirements, FATCA declarations, and LOB provisions for treaty claims.
For Indian individual investors, the India-US DTAA reduces dividend withholding from 30% to 25% through W-8BEN. For entities holding more than 10% of the voting stock in a U.S. company, the treaty rate drops further to 115% under Form W-8BEN-E. Capital gains on U.S. listed stocks remain untaxed by the U.S. for non-residents, regardless of which form you file.
Forms signed in 2023 expire on December 31, 2026. If that includes yours, set a reminder to renew before year-end. An expired form means automatic 30% withholding on your next dividend — money you would otherwise keep.
Disclaimer: The views and recommendations made above are those of individual analysts or brokerage companies, and not of Winvesta. We advise investors to check with certified experts before making any investment decisions.
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Table of Contents
Every Indian investing in U.S. stocks or earning income from the U.S. faces one early question. Should you file W-8BEN or W-8BEN-E? Pick the wrong form, and your broker may reject it outright. Worse, the IRS could withhold 30% of your income instead of the reduced treaty rate.
The answer depends on one thing — whether you invest as an individual or through an entity. This guide breaks down the individual vs entity W-8BEN decision so you can file with confidence.
What is Form W-8BEN?
Form W-8BEN is a one-page IRS document designed for foreign individuals. It serves three purposes. First, it confirms you are not a U.S. taxpayer. Second, it establishes you as the beneficial owner of the income. Third, it lets you claim a lower withholding rate under the India-US Double Tax Avoidance Agreement (DTAA).
If you are an Indian resident investing in U.S. stocks through a brokerage, this is likely the form you need. The same applies if you freelance for U.S. clients or receive royalties from American companies. You fill in your name, address, Indian PAN, country of tax residence, and the relevant treaty article. Most brokerages walk you through it during onboarding.
The current version is the October 2021 revision and remains valid through 2026. Once signed, it stays active until December 31 of the third calendar year after signing. A form signed in March 2025, for example, expires on December 31, 2028.
What is Form W-8BEN-E?
Form W-8BEN-E is the entity counterpart. It runs eight pages with thirty parts, though most filers only complete a handful of sections. Foreign corporations, partnerships, LLPs, trusts, and other non-individual entities use this form to declare their status for U.S. tax withholding and FATCA reporting.
W-8BEN-E for companies in India is common when a Pvt Ltd company earns dividends from U.S. holdings or receives payments from American clients. The form requires entity classification under U.S. tax rules, a FATCA status declaration, and, if applicable, treaty benefit claims. An authorised officer or director signs on behalf of the entity.
The complexity comes from two mandatory classifications. You must declare your Chapter 3 status (corporation, partnership, trust, etc.) and your Chapter 4 FATCA status (Active NFFE, Passive NFFE, or a type of financial institution). Most Indian operating businesses qualify as Active NFFE — meaning less than 50% of their income is passive.
Which form Indians need: A quick-reference guide.
The decision tree is straightforward. Ask yourself one question: Am I receiving thisU.S.S income in my personal name or through a registered entity?
Indian individual investors, salaried professionals with U.S. income, and freelancers all use W-8BEN. Indian Private Limited companies, LLPs, partnership firms, One Person Companies, and trusts all use W-8BEN-E. The form you need has nothing to do with the size of your investment or the type of income. It depends entirely on whether you are a person or an entity.
Here is a breakdown by common Indian investor profiles. A salaried individual buying Apple shares through a U.S. brokerage submits a Form W-8BEN. A Bangalore-based IT company that receives consulting fees from a U.S. client files Form W-8BEN-E. A family trust holding U.S. ETFs files W-8BEN-E.
Once you know which form applies to you, follow our step-by-step guide to filling out the W-8BEN and W-8BEN-E forms for line-by-line instructions.
Key differences explained
Beyond the "who files" distinction, several practical differences matter.
Form length is the most obvious gap. W-8BEN is a single page with three parts. W-8BEN-E spans eight pages with thirty parts, though you typically complete only Parts I, III, one FATCA-related part, and Part XXX for certification. The entity form demands far more detail because the IRS needs to understand entity classification for W-8 forms under both Chapter 3 and Chapter 4 of the Internal Revenue Code.
Treaty benefit claims also differ in structure. On W-8BEN, you fill Lines 9 and 10 in Part II — entering "India" as your treaty country and citing Article 10 for dividends. On W-8BEN-E, treaty claims appear in Part III, Lines 14 and 15. Entities must additionally satisfy a Limitation on Benefits (LOB) test, proving they genuinely qualify for treaty protection rather than being shell structures.
The identification requirements are similar but not identical. Both forms require a Foreign Tax Identification Number — your Indian PAN for W-8BEN or the entity's PAN or TAN for W-8BEN-E. Without a valid PAN, treaty benefits are typically denied, and the full 30% withholding rate applies.
Both forms have a validity period of three calendar years. Neither form gets filed with the IRS. You submit both directly to your withholding agent — usually your U.S. broker, bank, or the company paying you.
Entity classification under W-8BEN-E
Entity classification W-8 forms require careful attention because the IRS uses U.S.U.S. tax principles, not Indian legal definitions. An Indian LLP, for instance, is classified as a "Partnership" under U.S. rules even though it has features of a corporation under Indian law.
Here is how common Indian entities map to U.S. classifications. A Pvt Ltd or Public Ltd company selects "Corporation." An LLP or traditional partnership firm selects "Partnership." A family trust selects "Simple Trust" or "Complex Trust" depending on its distribution requirements. An estate selects "Estate."
The FATCA classification adds another layer. Most Indian businesses that generate active income—IT services, manufacturing, and consulting — qualify as Active NFFEs. This means they complete Part XXV of the form. Passive investment holding companies may fall under Passive NFFE, requiring disclosure of substantial U.S. owners in Part XXIX.
Getting the Chapter 3 and FATCA classifications wrong can trigger withholding at the full 30% rate or flag compliance issues. When in doubt, consulting a tax professional is worth the cost.
The HUF question: Which W-8BEN form for HUF?
Hindu Undivided Families create a unique challenge because HUFs have no direct equivalent in U.S. tax law. The IRS has not issued formal guidance on which W-8BEN form for HUF entities as of February 2026, leaving this partly in grey territory.
Under U.S. entity classification rules, the answer depends on the HUF's primary purpose. If the HUF exists mainly to protect and conserve family property for beneficiaries — the most common scenario — it would likely be classified as a foreign trust. The Karta acts as the trustee, and the coparceners are the beneficiaries. In this case, the HUF files W-8BEN-E with "Simple Trust" or "Complex Trust" as its Chapter 3 status.
If the HUF actively carries on business operations, it could be classified as a partnership under U.S. tax principles. Either way, W-8BEN-E is the correct form, not W-8BEN. The HUF is not an individual, so the individual form does not apply.
Given the complexity, HUFs investing in U.S. markets should engage an international tax advisor to determine their classification before filing.
W-8BEN or W-8BEN-E for sole proprietors
This trips up many Indian freelancers and small business owners. The question of W-8BEN or W-8BEN-E for a sole proprietor has a clear answer — use W-8BEN.
A sole proprietorship is not a separate legal entity. The IRS treats it as a "disregarded entity," meaning the individual behind it is the actual taxpayer. The IRS instructions for W-8BEN explicitly state that the owner of a disregarded entity must submit the individual form.
You file W-8BEN in your personal name, not your business name. Use your personal PAN as the Foreign TIN. Claim treaty benefits under your own tax residency. This applies whether you run a small design studio, a freelance writing business, or any other sole proprietorship earning US-source income.
The only exception is extremely rare: a sole proprietor operating through a hybrid entity structure that claims specific treaty benefits. For the vast majority of Indian sole proprietors, W-8BEN is the right and only choice.
Beyond choosing the right form, understand the full tax implications for Indian residents investing in the U.S.U.S. stock market, including capital gains, foreign tax credits, and ITR filing.
WhenW-8BEN-E is required
W-8BEN-E becomes mandatory the moment US-source income flows to a registered entity rather than an individual. Common scenarios for Indian entities include a Pvt Ltd company receiving software licensing fees from a U.S. firm, an LLP earning consulting revenue from American clients, a partnership firm holding U.S. mutual fund units that pay dividends, and a trust or HUF investing in U.S. stocks or bonds.
The trigger is not the income type — it is the recipient's legal status. Dividends, interest, royalties, service fees, and any other US-source payment made to a non-individual foreign entity require W-8BEN-E.
Timing matters as well. Most withholding agents require the form before they release the first payment. If you delay, expect 30% withholding on every dollar until a valid form is on file. Some platforms allow retroactive claims, but recovery is slow and paperwork-heavy.
Filing requirements comparison
Both forms follow similar filing mechanics with a few important differences.
Submission goes to your withholding agent — your U.S. brokerage, bank, or client — never to the IRS. Both forms use the same October 2021 revision currently in force. Both expire on December 31 of the third calendar year after the signing date. Both must be updated within 30 days of any change in circumstances, such as a change in tax residency or entity structure.
The key practical difference is effort. W-8BEN takes most Indian individuals five to ten minutes with PAN and address details ready. W-8BEN-E can take significantly longer because of entity classification requirements, FATCA declarations, and LOB provisions for treaty claims.
For Indian individual investors, the India-US DTAA reduces dividend withholding from 30% to 25% through W-8BEN. For entities holding more than 10% of the voting stock in a U.S. company, the treaty rate drops further to 115% under Form W-8BEN-E. Capital gains on U.S. listed stocks remain untaxed by the U.S. for non-residents, regardless of which form you file.
Forms signed in 2023 expire on December 31, 2026. If that includes yours, set a reminder to renew before year-end. An expired form means automatic 30% withholding on your next dividend — money you would otherwise keep.
Disclaimer: The views and recommendations made above are those of individual analysts or brokerage companies, and not of Winvesta. We advise investors to check with certified experts before making any investment decisions.
Ready to earn on every trade?
Invest in 11,000+ US stocks & ETFs
