Skip to main content
Northwestern University

Payments to Foreign Vendors

The University is required to establish the tax status of foreign entities with which it conducts business. The W-8 submitted by a foreign corporate vendor indicates whether taxes need to be withheld when payments are processed.  Transactions that may trigger tax withholding include services performed in the US, and US-sourced royalties and rents. A foreign vendor from a country that has negotiated a tax treaty may be exempt from tax on certain types of transactions.  If they are from a country with no treaty benefits, or the activity is not covered in the treaty, payment to the vendor will be subject to 30% tax withholding.

Foreign vendors will be placed on a payment “hold” to ensure that all potential payments to the vendor are reviewed for compliance prior to payment being processed.

Each W-8 will be reviewed by for tax status determination, and each invoice submitted for payment will be reviewed by Accounts Payable for taxable-type transactions.

Invoice Requirements

Foreign vendor must provide an invoice that specifies each individual activity and location of the activity:

 AP Process Steps

If the invoiced activity is a taxable type of transaction for that foreign vendor, AP will process as follows:

Contact

For questions about processing the invoice or payment status, contact Gary Ernsteen at 847 491 2781 or by email at g-ernsteen@northwestern.edu

For questions about vendor set-up, procedures or policy, please contact Elizabeth Gladic at 847-491-5338 or e-gladic@northwestern.edu

Back to top