Treaty Claim
A formal claim under a bilateral tax treaty for reduced withholding or full exemption from U.S. tax.
In full
A treaty claim is asserted on Form W-8BEN-E Part III (entities) or W-8BEN (individuals), supported by a tax residency certificate from the home jurisdiction. The claim must reference the specific treaty article and the limitation-on-benefits qualifier. A claim that is not properly documented is disallowed: the withholding agent must withhold at the statutory rate and remains liable for any amount under-withheld, together with interest and penalties.
Governed by: Withholding claim documentation rules.
This definition is general information about how the term is used in U.S. cross-border tax. It is not advice, and how it applies depends on your own facts and on the treaty, if any, in force with your country.
Related terms
- W-8BEN-EIRS form used by foreign entities to claim treaty benefits and certify FATCA status.
- FDAPU.S.-source passive income subject to 30% withholding at source (reducible by treaty) — dividends, interest, royalties, certain service income.
- Permanent EstablishmentA fixed place of business or dependent agent creating jurisdiction to tax under a bilateral tax treaty.