Claim of Tax Treaty Benefits - Romania - Form w8-BEN - to avoid double taxing

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Created Aug ’19

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I'm trying to submit my tax info, but I really don't understand what I should put & complete in the Part II section in the "Agreements, Tax and Banking".

I'm a Romanian citizen, I don't live in U.S, neither I don't work for U.S company.

What I'm trying to achieve is to avoid double taxes.

This is how the form looks like:

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Part II: Claim of Tax Treaty Benefits: (If Applicable)

[ * ] 9. I certify that the beneficial owner is a resident of Romania within the meaning of the income tax treaty between United States and that country or region.

10. Special rates and conditions

The beneficial owner is claiming the provisions of Article and paragraph [ optional ] of the treaty identified on line 9 above to claim a [ optional ] % rate of withholding on (specify type of income):

Type of Income (dropdown)

Income from the sale of the apps
Other (if this is selected another field shows up)

Explain the additional conditions in the Article and paragraph the beneficial owner meets to be eligible for the rate of withholding

[ long optional field ]

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This is what I've found from the IRS: https://www.irs.gov/pub/irs-trty/romania.pdf

Should I put in the optional fields: ARTICLE 12 - Royalties and with a 10% rate of withholding?

[ * ] - is a checkbox

[ optional ] - is a field which can be completed

This is what I've found searching on the web:

Under Foreign tax identification number you put your CNP from your National ID card.
9. Special rates and conditions: The beneficial owner is claiming the provisions of Article you write - "Article 12 of the SOCIALIST REPUBLIC OF ROMANIA DOUBLE TAXATION: TAXES ON INCOME".
Under of the treaty identified on line 9 above to claim a you write "10" (as in 10%).
Under % rate of withholding on (specify type of income): you write "Royalties-12, Other".
Under Explain the reasons the beneficial owner meets the terms of the treaty article: you can write: "Beneficial owner is a resident of Romania, meeting the terms of the treaty under Article 3 (Fiscal Residence). The US tax shall not be deductible from the income for independent personal services of a resident of Romania per Royalties-12, Other of the Romania-US Convention for the Avoidance of Double Taxation of 1 January 1974.".

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Answer 1

LexNH OP

Oct ’19

Hello,

I have exactly the same problem and am in the same case, with a company in Romania too.

Did you find an answer to your questions?

How did you finally fill the thing and what were the consequences?

Thanks,

Alex

1

Answer 2

wizard_dev OP

Aug ’22

Hello there, I also have a limited company based in Romania and I've searched the internet for some guidance and i found out this great great blog post which explains how to correctly fill out the US Tax Form w-8ben-e for a limited company based in Romania. This is the link: https:// www .cristiangutu.pro /***-completezi-un-formular-w-8ben-e/ (sorry but i had to space out the url or else i wouldn't have been allowed to post it here, at all...)

If for some reasons the link gets outdated and won't work in the future I will explain here what's important:

For "8. U.S. taxpayer identification number (TIN), if required" you don't fill in anything, you leave it blank.

For "9b. Foreign TIN" you fill in your company's fiscal code not your national ID number (with or without the country code RO in front of the number).

For 9c if you have it leave it blank, the same for 10.

Now onto the fun part: Part III: Claim of Tax Treaty Benefits: For "14a and 14b" you check them both, leaving "14c (if you have it)" empty. For the dropdown option on 14b you select this: Type of limitation on benefits provisions: Company that meets the ownership and base erosion test.

For "15 Special rate and Conditions" you fill it like this:

The beneficial owner is claiming the provisions of Article and paragraph Article 7 - Business Profits of the treaty identified on line 14a above to claim a 0.00 % rate of withholding on (specify type of income): and here you only check the first option -> Income from the sale of applications.

Then for the explanation under "Explain the additional conditions in the Article the beneficial owner meets to be eligible for the rate of withholding" you type in this: The company is resident in Romania and does not carry on business in the United States nor does it have a permanent establishment in the United States. (Romania-US Convention for the Avoidance of Double Taxation of January 1st 1974).

Finally for "Part ***: Certification" you only check the first option and then sign your name, check anything else that you might have to check and submit the form.

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