Sorry to bring up an old thread, but this is quite important for non-US affiliates who are needlessly filling out IRS tax forms.
The W8BEN form 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 it's head 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 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."
As I said previously, FOREIGN SOURCED INCOME IS NOT SUBJECT TO WITHHOLDING.
All that is required is that the foreign affiliate CERTIFIES they do not have any US-SOURCED income and are not a US Taxpayer, etc.
Google has it SPOT ON, on their Adsense tax information page:
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 programme. 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:
* setting up a web server, hosting service, or website
* developing content for your website
* marketing to create a user base for your site
* telephone support for your site
* buying products for your site
* 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, you will be asked to agree to a statement to that effect. No tax forms are required in this instance.
That's it in a nutshell.
Commission Junction, and other merchants are doing a DISSERVICE to their foreign affiliates by requiring them to fill out forms that are not required, and making these people think they need to put themselves in the US tax system.
Foreign affiliates need to stand up and say "hey! enough's enough!".
Perhaps you Alan, as one of the most widely recognised international affiliates out there, could put the call out to the merchants like COMMISSION JUNCTION to stop handing out bad, possibly litigable, taxation misstatements.