What is the W-8 (US tax form) and why is it important?

The W-8 form is a legal US Treasury document required by the Internal Revenue Service (IRS) that allows foreign investors to claim concessional tax treaty benefits, including a reduced rate of withholding tax (as shown in the table below):

Invalid or no W-8

 

Valid W-8

Invalid or no W-8

Sell trade

0% tax on sale proceeds

30% tax on sale proceeds

Dividend Payment

15% tax

30% tax

For example, if you were to buy $10,000 worth of Apple shares and sell the shares at a later date for the same value of $10,000 without a valid W-8, $3,000 (30%) of the proceeds will need to be withheld and remitted to the IRS and you would only receive $7,000 after settlement (less transaction costs). If you have a valid W-8 and are eligible for treaty benefits, you should receive the full $10,000 (less transaction costs) after settlement.

Please note: The above example is only used to show the difference a W-8 can make to the proceeds from a sale. There may be other tax implications from your transactions. Please speak to your accountant to understand your personal situation and implications.

Each form applies for three years or as the US Treasury determines. There is also a requirement to submit an updated form when any of your circumstances change (e.g. name change).

Forms and samples

For information on what forms are available and which forms Westpac accepts, please Click here.

Individual and Joint Accounts

Company Accounts

Trust Accounts

Superannuation Accounts

Where do I need to send my forms?

Once you’ve completed your forms, you can submit them by email or post:

Email: maintenance@onlineinvesting.westpac.com.au
Post: Westpac Securities - Global Markets
Reply Paid 85157, Australia Square NSW 1214

If you have any questions, please call the Global Markets Trading desk on 1300 757 319 (open 24 hours on US trading days).

Please note Westpac Online Investing cannot provide any advice on taxation matters; please refer to your adviser or accountant.

Published 08 November 2018