[jeddawson]

I have a related question, but switched around: I have a US based company that recently started paying an international contractor (individual) for some programming work. He’s not a W2 employee and being that he’s not a US citizen I’ve just been paying him in full and not withholding anything for taxes. This mirrors how I’ve paid other US based 1099 contractors.

As the project has gained momentum and is looking to be something that will continue long-term, it has me wondering about the correct process. A couple weeks ago I spent a few hours researching IRS documents and posts found by googling, but nothing was conclusive. Some of the information I found indicated what I’ve been doing is correct, but I need to have the contractor sign a W-8BEN [1]. Other information indicated that I should be withholding 30% of his earnings even though he meets the standard to be a 1099 contractor if he was a US citizen.

Do others have experience with this and what can you offer as advice?

[1] https://www.irs.gov/pub/irs-pdf/fw8ben.pdf

[davimack]

If they've established a corporation on their end of things (known as a "sole trader" in the UK), then you can just send them a 10-99 as per usual, because you're paying a corporation, not a person. I have done this with a contractor in the UK and my corporation is in the US and had no problems with it.

--edit: this is my personal experience and may not be used as tax advice in the legal sense--

[mvip]

As someone who has been dealing with this for years and hired a lot of developers/contractors, I would suggest one out of two options:

* Hire them via a proxy, such as Upwork or similar.

* Make sure the contractor spin up a local company and invoice you.

You might be able to do it some other way, but it's likely going go cause you a lot more issues and headache.