The Expiring W-8BEN Report identifies clients whose W-8BEN forms are nearing expiration or have already expired. Maintaining an up-to-date W-8BEN form ensures your clients continue receiving favorable tax withholding rates on U.S. investment income. Timely action prevents unnecessary additional withholding and avoids negative impacts on client returns.
What is a W-8BEN Form?
A W-8BEN form is used by non-U.S. residents to declare their status and claim eligibility for reduced withholding tax rates on income earned from U.S. investments. Properly completed W-8BEN forms ensure clients benefit from applicable tax treaties between Canada and the United States, preventing unnecessary taxation.
Why Clients Appear on this Report
Clients appear on the Expiring W-8BEN Report when their previously submitted W-8BEN form is nearing expiry or has recently expired. A W-8BEN form typically remains valid for three calendar years after the year it was signed.
How this Impacts Clients
Clients with an expired W-8BEN form lose the reduced withholding tax rate benefits provided by the Canada-U.S. tax treaty. This results in the standard withholding tax rate of 30% being applied on income earned from U.S. securities, significantly higher than the reduced treaty rate of 15%. Renewing these forms proactively maintains the reduced withholding rate on U.S. income from investments, and ensures that the client is not overpaying withholding tax on this income.
How to Access the Expiring W-8BEN Report
To access the Expiring W-8BEN Report:
- Log in to the CRM portal.
- From the left navigation menu, click CRM > Contacts.
- On the account’s index page, you can access the report as a saved view by clicking +Add view to the right of the tabs on the index page, and selecting Expiring W-8BEN Report from the dropdown.
You will now see a filtered list of all clients whose W-8BEN forms are approaching expiry or have already expired.
Resolving Expiring or Expired W-8BEN Forms
To address expiring or expired W-8BEN forms, submit an update request through the CRM:
- Navigate to the client's CRM Contact Record.
- Submit an Update Account Documentation & Form Updates > W-8BEN Form Update service request.
For detailed instructions, see the related article: Learn how to update a W-8BEN form.
Best Practices
- Regularly review the Expiring W-8BEN Report monthly or quarterly to proactively manage upcoming expirations.
- Engage with clients well in advance of the expiration date to ensure sufficient time for processing and submission.