A W8 form (W8BEN) is only required to be filled out for
US SOURCED income. Now "US Sourced" doesn't mean where the person writing the check is, it means where the work was done by the PAYEE.
The OECD (of which the USA is a member of) put its heads together many years ago and determined that if you OWN a webserver in a country, then the websites you have on that server are producing income SOURCED in that country. If you merely RENT a webserver or webspace in a country, the websites on it are producing
FOREIGN SOURCED income.
FOREIGN SOURCED income is not subject to tax in the USA and does NOT require form W8BEN to be filled out. W8BEN is for foreigners to claim exemption from withholding tax on US SOURCED INCOME for tax treaty obligations.
The instructions for W8BEN are clear:
"
Who must file. You must give Form W-8BEN to the withholding agent or payer if you are a foreign person and you are the beneficial owner of an amount SUBJECT TO WITHHOLDING."
Like I said, FOREIGN SOURCED INCOME IS NOT SUBJECT TO WITHHOLDING.
All that is required is that the Non-US affiliate CERTIFIES that he does not have any US-SOURCED income and that he is not a US Taxpayer.
Google has it spot on, on their Adsense tax information page:
https://www.google.com/adsense/taxinfo:
Quote:
Non U.S. Business (No U.S. Activities )
United States (U.S.) Activities involve having employees or owning equipment in the U.S. that are involved in any way with revenue earned through the AdSense program. This includes, but is not limited to, owning a web server or owning a hosting service in the U.S., or having employees in the U.S. who are involved in either:
1. setting up a web server, hosting service, or website
2. developing content for your website
3. marketing to create a user base for your site
4. telephone support for your site
5. buying products for your site
6. maintaining your site
Generally, utilizing an unrelated third-party U.S. web hosting service to host your web pages, renting web servers that are located in the U.S. from an unrelated third party, or having your payment sent to a U.S. Post Office Box or mail forwarding address, do not of themselves constitute U.S. Activities.
If you do not have U.S. Activities, please visit the Tax Information page under your My Account tab where you will agree to a statement to that effect. No tax forms are required in this instance.
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So refusing to pay a Non-US affiliate because he did not send you a W8 form is.... stealing!
That's all folks...