WP7 Marketplace Signup help for Aussies Part 3 (filling out the W-8BEN)
This is the third article for Aussies (and others o/s) who are in the process of signing up so they can be paid for Apps sold via Windows Phone 7 Marketplace. This entry covers the final step required to get paid – submitting a valid W-8BEN form to Microsoft Marketplace.
If you want to check out the first couple of articles – please see links below :
What is the W-8BEN
The W-8BEN form is the document you need to provide someone who is paying you money from o/s (in this case the Microsoft Marketplace Commerce Team) – and it’s full name is something akin to what you’d find in a Borat sequel – “Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding”.
The PDF downloadable version of the W-8BEN can be obtained from this address – http://www.irs.gov/pub/irs-pdf/fw8ben.pdf – and allows you to type in some of the required fields via the Acrobat viewer (as it’s a editable PDF form).
Ideally – you’d submit this form after you had obtained either a US Tax File Number (ITIN – See Part 2) /or/ EIN. However, if you are willing to forgo the 30% withholding tax on payments made to you (nb: that % may be different for other countries) – you can submit this form without indicating you have one of those.
Like with the ITIN application (which is sent to the IRS) – you need to submit an actual hard copy of this document to Microsoft for it to be valid (ie. you can’t email or fax it in).
Like with the ITIN application (W7) – everything needs to be perfect for it to be accepted – otherwise it will be rejected by Microsoft if any minor thing is wrong – and you need to do it all again (back to go – don’t collect $200 etc). So it’s very important you don’t mess this document up.
Normally, Microsoft won’t process/approve this hardcopy until your first payment is made (which will be at end of the month and assuming you are owed at least USD$200). However – to save a lot of hassles when it’s time for payment – Microsoft offer an ‘email based’ pre-approval service (which essentially allows you to scan in your W-8BEN and submit it via email). This way if something is wrong you at least find out about it a lot sooner – AND you don’t need to waste money on courier/mail services to get an invalid to them.
In order to do this ‘pre approval’ – scan in your form (to jpg etc) - and send it to firstname.lastname@example.org – and then wait up to a couple of weeks to get your response. If it’s approved – then it’s then (reasonably) safe to send in the real thing.
How to fill out the W-8BEN
The following walkthrough provides information on how to fill out this W-8BEN form – and references to the 11 sections on this form. (please download it first so the below makes sense).
Part 1 :
Section 1 – “Name of individual that is the beneficial owner”
This field needs to be entered via the “Microsoft rules” for approval – in that you need to clearly identify both your own name – plus the company name of your Marketplace account. (so Microsoft can match it up with your account internally).
For example – for the company/account name (the one visible to end users on Marketplace) is ‘ACME Games’ – and my own name is ‘Joe Smith’ – hence the correct entry is in format ‘#my name# [#marketplace name#]’ :-
Joe Smith [ACME Games]
(NB: If your marketplace company name is just your name I think you can either leave out the ’s – or simply put in your name there as well).
Section 2 – “Country of incorporation or organization”
This simply needs to be the country you are in – ie. ‘Australia’
Section 3 – “Type of beneficial owner”
For individuals and solo traders operating outside of the USA – you should just tick ‘Individual’ as the correct option.
I’m 99% certain that even if your company is a full incorporated entity (not using EIN) then you still need to tick individual (as the other options relate to companies based inside the USA). However – you may want to check with your accountant or the IRS website to confirm this.
Section 4/5 – Address Details
This is pretty straightforward – simply put in your actual address (note that for 4 you can’t use a p.o.box etc – must be a real address). Leave 5 blank unless you do have some other address you want correspondance to be sent to.
Section 6 – “U.S. taxpayer identification number, if required (see instructions)”
This bit is pretty important – as it determines whether or not the US gov withholding tax is ‘automatically’ deducted from payments made to you by Microsoft.
If you have obtained a ITIN or EIN – you should enter the appropriate number assigned to you – and tick the appropriate box.
If you leave this blank then it means you don’t have one of these (or you intend to supply the W-8BEN a second time with this information).
Section 7 – “Foreign tax identifying number, if any (optional)”
I wasn’t 100% sure what to put here – so just to make sure I provided my Australian ABN number and indicated that it was that (which was accepted by Microsoft) :
ie. XX XXX XXX XXX (Australian ABN)
It’s possible leaving this either blank – or providing some other info (such as your personal Australian TFN) – is also appropriate.
Section 8 – “Reference number(s) (see instructions)”
I left this blank – and suspect this is the case unless you filled in something other than ‘individual’ in section 1 (speak to your accountant).
Part 2 :
Section 9 – “I certify that (check all that apply)”
I used the following information (based on me supplying an ITIN number) -
Checked [a] – and entered ‘Australia’ in the line provided.
Checked [b] – to indicate I had provided a taxpayer identification number in section 7.
Note: My understanding is that if you are not providing an ITIN or EIN – then you would not check any of these options in Section 9.
Section 10 – “Special Rates and Conditions”
This one is a little confusing – as it’s similar to the type of question asked on the W7 form (where you need a treaty article number etc). I actually left this completely blank (instead relying on the ITIN to indicate for no tax to be withheld).
I suspect if you are in Europe – and other tax issues such as VAT are in play – then this may be where you can provide this information (but for Australians it didn’t seem to be required).
Part 3 :
I just ignored this bit (as there’s nothing to actually fill out). However – I did provide a cover letter along with my W-8BEN stating why I was submitting the form etc. (so not sure if this was even necessary).
Part 4 :
Don’t forget to sign this form and date it! The other bit in here (apart from signature and date) – is the ‘Capacity in which acting’. I provided the value ‘Individual’ (which I think is similar to Section 3) – except this might be different if someone else is filling out this form on your behalf.
Once you’ve filled out/scanned and submitted the W-8BEN to Microsoft via email (for pre-approval) – you’ll either get a ‘yes’ or ‘no’ from Microsoft.
If it’s a ‘yes’ then you can proceed to send everything in to Microsoft via snail mail.
The correct address for this is as follows :
Microsoft – Windows Marketplace for Mobile
Attn: Finance Department
29011 Commerce Center Drive
Valencia, CA 91355
As per this link, Microsoft recommends quote – ‘sending the W-8 form using some form of tracking mechanism to assist in investigating any issues related to the delivery of the W-8 form’. I personally used Australian Express Post satchel – and sent it register post with delivery confirmation (extra feature) – which cost somewhere around ~AUD$15.
Please Note as mentioned above – the final ‘approval’ by Microsoft on your hard copy W-8BEN will not be performed until you receive your first payment event. Hence – until that point is reached – App Hub will show you the ‘bank or tax information missing’ style messages when you look at your account (so be patient and ignore these messages).
Once the first payment is made – then your App Hub account will no longer show these messages – and within a few days of payment – you will be able to start viewing your payment reports (via Reporting section in App Hub).
Additional Steps … (EU VAT Exemption)
If you’re in a country where EU VAT is an issue – you can also submit your ‘VAT Identification Number’ to obtain EU VAT exemption (after your W8-BEN is sent). This will allow Microsoft to send you your HCTI (Hard Copy Tax Invoice) if it’s applicable to your country for payments collected/paid.
Microsoft’s advice on this is ‘You are not required to provide a valid VAT Identification Number to get paid, but without it you will be charged the VAT’ .
Please see the appropriate section in this link for more information on EU VAT and how it may apply to you.
Well once you’ve done everything covered in these 3 articles AND of course you’ve got a paid app out there – it’s time to finally collect some money… Now you can sit back and way for the $$ to roll (or more likely trickle) into your nominated bank account.
Note that payments may take 60-90+ days to arrive from the actual date the app was purchased (due to funds needing to be collected from various mechanisms such as credit card, carrier billing etc) – and individual payments need to be USD$200 or more (otherwise anything owing will be rolled into next payment event).
That’s it folks – hope these posts have helped you untangle some of the confusion around signing up for Marketplace when you’re not in the USA. Please leave comments/feedback if you have some more wisdom to share on any of the topics in these posts.