W-9 vs. W-8: Tax Forms for US and Foreign Contractors Explained

Global hiring is booming, giving companies everywhere access to talent beyond their borders. However, with that growth comes the challenge of taxes, which can be confusing for both employers and workers.

One of the most common questions is W-9 vs. W-8 tax forms for US and foreign contractors. Which form do you need to send, and to whom?

For employers managing a global workforce, getting these forms right can be tricky. It involves a lot of administrative work. But using Deel to hire, pay, and manage contractors end-to-end simplifies it with advanced tax compliance automation and AI-driven worker classification.

Deel Contractor and Contractor of Record help to ensure accurate tax filing and avoid misclassification risk.

In this guide, we’ll walk you through the key differences between the W-9 and W-8 forms, show you exactly when to use each form, and why it matters.

Tax forms for contractors: General rules

Only US-based companies need to collect Forms W-8 or W-9. If your company is based outside the US, there’s no need to collect them. You will still need to handle the tax compliance matter, but it will be according to the laws of the country where your company operates.

If your company is based in the US and hires US citizens, you must comply with domestic tax laws and use Form W-9. If you are a US-based company hiring foreign contractors, it’s your responsibility to issue the Form W-8BEN to independent contractors acting as individuals, or W-8BEN-E forms to those acting as business entities.

We understand that tax compliance across borders can be a lot to handle. That’s why Deel guides contractors to submit the correct forms based on their location and status, so you don’t have to figure out which form goes to whom. Our automated workflows and local compliance experts ensure the right documentation is collected.

In the following sections, we’ll explain these forms more in-depth.

What is Form W-9?

The tax form W-9 is used to collect and verify the necessary information from US-based independent contractors. When tax season approaches, employers issue these forms to their independent workers and keep the completed document in their possession. Employers aren’t bound to submit the form to the IRS, but they must have it.

Form W-9 contains different data about the independent contractor. In addition to their name and current address, there’s also the TIN (Tax Identification Number) or Social Security number. This number has nine digits and must be provided in the form to avoid potential penalties from the IRS.

Only independent contractors are required to fill out this form. Since form W-9 only serves to identify the contractor and get their personal information, employers must file Form 1099-NEC with the IRS to report how much they paid the contractor. This allows the IRS to match the income with the contractors’ tax return.

Here’s a guide with more details about form W-9.

What is Form W-8?

When an employer hires contractors outside of the US, they need form W-8 to get their information.

The employer must issue Form W-8 to the contractor so they can certify their foreign status and claim any applicable tax treaty benefits. If a contractor doesn’t submit a completed form in a timely manner or provides invalid information, they may need to pay the full tax rate on their income, which is 30%.

The employer must issue the form to the contractor, but is not obligated to submit it to the IRS.

Form W-8BEN and Form W-8BEN-E

A business that hires foreign contractors may need either W-8BEN or W-8BEN-E forms, depending on how the contractor acts – as an individual or a business entity.

Form W-8BEN is also called Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting. It proves that a contractor is indeed a non-US person, they complete their work outside of the United States, and may receive income from US sources.

The other type of W-8 form, Form W-8BEN-E, is used when a foreign person acts as a business entity rather than an individual.

This tax reduction is possible in both cases (individual contractor or business entity) if the US has a tax treaty with the country from which the contractor comes.

Read this article on form W-8BEN to check what countries have a tax treaty with the US and learn more about tax forms for independent contractors.

See more: How to Hire & Manage International Contractors in 2025

Other types of Form W-8

While W-8BEN and W-8BEN-E are the most common for foreign workers, the IRS issues other types of Form W-8 depending on the business structure or type of income.

See more: When to Transition From Contractors to Full-Time Employees

Handle tax documentation hassle-free with Deel

Figuring out whether to use a W-9 or W-8 is just one piece of managing a global workforce. You must also handle contractor classification, global payments, and international compliance.

However, there’s an all-in-one global people platform for hiring, paying, and managing contractors and employees for you. Deel.

Deel handles everything from compliant contracts and global payroll to localized tax forms and contractor payments. We ensure your international HR operations stay compliant and your workers are paid on time in their preferred currency. With just one mass payment, you can fund and pay your entire global team efficiently and in minutes.

To learn more about Deel, book a demo today.