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I am an Indian citizen doing domain reselling, for of a US company. While signing up for the reseller program, the company had asked me to furnish my tax information. I would like to have some clarification regarding U.S tax information submission as I am not familiar with the same.

Please check the below details and queries and advise me on which form(s) should I submit. 1. I am an Indian citizen running the reseller program as an individual and not as a registered company, trust or partnership.

I have never been to the U.S; I am not associated with any relative living in the US in doing this business.
I am the sole beneficiary of any commissions I make through the reseller program.
This income which I receive as commissions are taxable in India.
There is a tax treaty between India and U.S to avoid double taxation.
As the website is accessible from any country, I'll be selling the services in and outside U.S.A.

Queries:-

What income stream would the income I receive from the company comes under? (I presume if I am making a sale in U.S, it is the parent company that is making the sales and I am an intermediary. Hence I am just receiving commissions?)
Should I be submitting Form W-8IMY or Form W-8BEN or any other form(s)?
If I am submitting Form W-8BEN, should I fill PART II - 9a and PART II – 10, if I am a beneficiary of the tax treaty between the two countries?

Thank you in anticipation.

edited Nov 19 at 22:13

TaxQueries♦♦
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asked Nov 5 at 9:33

unknown (google)
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SandySea · Answer 1 · 2009-11-05 13:08:57Z UTC

This is non US source income since you have no nexus in the US.

You do not have to submit any forms to the person you are contracting for, but question do they have a business in India as well?

Tax treaty does not apply to you since you have no tax implications in the US.

Contact the US company's accounting department and let them know this form is not required to be filled out by you.

Brent Berkman · Answer 2 · 2009-11-05 18:30:06Z UTC

Sandy is correct and that neither W-8BEN or W-8IMY need completing and to contact the U.S. Company's accounting department or human resources department. (Sometimes HR handles, or payroll or even accounts payable in the case of an independent contractor.)

The authority is Article 15 of the U.S. / India Tax Treaty which refers to "independent" personal services and Article 16 which refers to "dependent" personal services, or services provided by an employee.

Compensation from "independent personal services" would generally be taxable in the U.S. if either of the following is met:

(a) if such person has a fixed base regularly available to him in the other Contracting State for the purpose of performing his activities; in that case, only so much of the income as is attributable to that fixed base may be taxed in that other State; or (b) if the person's stay in the other Contracting State is for a period or periods amounting to or exceeding in the aggregate 90 days in the relevant taxable year.

The term “professional services” includes independent scientific, literary, artistic, educational or teaching activities as well as the independent activities of physicians, surgeons, lawyers, engineers, architects, dentists and accountants.

Compensation from "dependent personal services" would generaly be taxable in the U.S. if either of the following is met:

(a) the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in the relevant taxable year; (b) the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State; and (c) the remuneration is not borne by a permanent establishment or a fixed base or a trade or business which the employer has in the other State.

Being a foreigner, which form should I submit to provide U.S tax information ?

2 Answers