Hello, I am a sole trader in the UK and have started working for a US company (based in NY). I have provided them with the W-8BEN form in order not to be taxed in the US because I pay National Insurance and Income Tax in the UK. I have sent my first invoice to the company and their accountant replies me back with the following: "We are required to withhold 30% of her pay and we need to pay it over each pay period via EFTPS. There are also annual reports that need to be filed, 1042, 1042S & 1042 T. If she applies for an ITIN number, she can file to get the withholding back." I think this is wrong because they would treat me as a US citizen rather than respecting the W-8BEN clause.
I checked further online and now understand I need to first get an ITIN number via W-7 which I can add to my W-8BEN.
Could you confirm that once this is provided to my employer (W-8BEN with ITIN) they will not need to withhold the 30%?
Could you advise me? Thanks, Lucie