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US Dividends Tax Declaration - Form W-8BEN

As an Investor in the US markets, you'll need to complete an electronic declaration form called W-8BEN. This allows you to pay a lower Dividend Withholding Tax (“DWT”) when you receive dividends from a source within the US, and you are not a US tax resident.

The form will appear on your screen once you log into your USD account

When completing this declaration, please make sure you select YES under the Treaty benefits section.

By doing so, it means that you are independently and securely confirming your country of tax residence with the USA Internal Revenue Service (IRS) to determine the correct (usually lower) rate of tax you should be paying on dividends received.

Who can complete the W-8BEN

Non-US citizens invested in the US who have already received dividends from any US-listed company but haven’t declared them yet.

What happens if you do not declare using the W-8BEN form?

Instead of paying a reduced tax amount, you will be liable for Dividend Withholding Tax (DWT) at the maximum rate of 30%.

Steps for Individuals to complete the W-8BEN declaration

Once you log in to your account, as an investor who does not reside in the US but has invested in US shares, you will be prompted to complete the declaration and to fill in all required information.

These are the following blocks you should tick and shouldn’t 

Is the account holder an individual or a non-individual/entity 

Yes (Yes means that you are confirming to be an individual) 

Is the account holder a citizen or resident in the United States? 

No ( No means that you currently do not reside in the U.S.) 

Do not click the effectivly connected income box unless you have the required information. 

U.S TIN 

If you do not have a US TIN, then do not fill in anything. Click the box within the section 

Tax Residence

This is the country where you pay tax. After if you do not have a tax number leave the TIN option blank and click the box within the section 

Treaty Benefits 

Is the account holder claiming a reduced rate of withholding under the tax treaty between the U.S and other country?

Yes - This means that you are confirming that you are not a U.S. citizen to pay lower tax on dividends received 

Treaty county 

This will be the country in which you pay tax, make sure to click the box below to certify that you live within the country. 

Do not click the special rate claim box unless you have the required information. 

From there on, you can read and click the following blocks to complete your form.

The tax rate you pay is determined by the country you are a resident in, take for example:

South African citizen

South African tax residents are only liable for a 15% DWT on dividends received from the USA. This tax rate differs from one country to another and depends on the Double Tax Treaty your country has signed with the IRS.

NOTE: In filling in the "Treaty benefits" section of the form, unless you have received special approval from the IRS for a "Special rate claim", please leave the box unticked which states "The account holder is making a special rate claim under a specific article and paragraph of the tax treaty" This box will only be ticked in rare circumstances where you have obtained special approval from the IRS to pay withholding tax at a custom rate, and will not be applicable to 99% of customers. 

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