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Regarding W-8-BEN for annuity inheritance

Personal Finance & Money Asked on December 18, 2020

My father worked in USA for 11 months in 1985. He made contribution to an individual retirement plan (tiaa-cref) only during that period. The money since then has grown. He expired in 2016 aged 68 without starting annuity payments. My mother is the named beneficiary and has been asked by the institution to sign a form accepting her inheritance and also W-8-BEN. My parents have been residing in India since.

  1. What has to be put in part 2 point 10 of W-8-BEN?
  2. How tax return has to be filed in India ? Under which form ?
  3. Does tax return have to be filed in USA ? If yes, under which form ?

Is there anything else in this context that we should know?

One Answer

Best consult a CA who is aware of dual taxation.

What has to be put in part 2 point 10 of W-8-BEN?

Leave blank. There is no special relief under DTAA or any such agreement. The US DTAA for India is here. And the India DTAA for US is here.

It is clearly called out there is no relief. So a standard 30% would be deducted.

How tax return has to be filed in India ? Under which form ?

This has to be shown as income from other sources. Generally foreign earnings brought back to India within a period of 7 years is tax free; else taxable at the tax brackets.

Does tax return have to be filed in USA ? If yes, under which form ?

Don't know. Maybe someone will answer this.

Answered by Dheer on December 18, 2020

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