Form 15CA and Form 15CB are essential documents required for remittances to non-residents, ensuring compliance with income tax regulations. In this comprehensive guide, we will explore the purpose of these forms, when they are necessary, and the mandatory information needed for filing. Additionally, we will discuss the transactions exempt from Form 15CA. Understanding these forms is crucial for individuals and entities involved in international transactions.
1. What is Form 15CA?
Under Section 195 of the Income Tax Act, any person making a payment to a non-resident individual or foreign company must deduct Tax Deducted at Source (TDS) if the payment is taxable. Details of such payments are required to be furnished in Form 15CA. This form must be submitted by the person responsible for making the remittance before initiating the payment.
2. What is Form 15CB?
Form 15CB is a document that must be furnished by a Chartered Accountant when the remittance or the aggregate of remittances exceeds 5 lakh rupees during the financial year (FY), and an order or certificate under sections 195(2), 195(3), or 197 of the Income Tax Act has not been obtained from the Assessing Officer. In Form 15CB, the Chartered Accountant certifies the TDS rate, details of payments, TDS deduction, and other relevant information regarding the nature and purpose of the remittance.
3. Which form of 15CA to fill:
Depending on the amount of remittance and the presence of necessary certificates or orders, different parts of Form 15CA need to be filled:
Part A: When the remittance or the aggregate of remittances does not exceed 5 lakh rupees during the FY.
Part B: When the remittance or the aggregate of remittances exceeds 5 lakh rupees during the FY, and an order or certificate under sections 195(2), 195(3), or 197 of the Act has been obtained from the Assessing Officer.
Part C: When the remittance or the aggregate of remittances exceeds 5 lakh rupees during the FY, and a certificate in Form 15CB from a Chartered Accountant has been obtained.
Part D: When the remittance is not chargeable to tax under the Income Tax Act, 1961.
4. When is Form 15CA not required to be furnished?
According to sub-rule (3) of Rule 37BB, Form 15CA is not required in the following cases:
- Remittance made by an individual that does not require prior approval from the Reserve Bank of India (RBI).
- Remittance falls under the specified nature as per the relevant purposes code defined by the RBI.
5. Mode of Filing Form 15CA?
Form 15CA can be filed both online and offline, providing flexibility for individuals and entities.
6. Overall List of Payments where no 15CA CB forms are required?
| 1 | 3S0001 | Indian investment abroad – in equity capital (shares) |
| 2 | 3S0002 | Indian investment abroad – in debt securities |
| 3 | 3S0003 | Indian investment abroad – in branches and wholly owned subsidiaries |
| 4 | 3S0004 | Indian investment abroad – in subsidiaries and associates |
| 5 | 3S0005 | Indian investment abroad – in real estate |
| 6 | 3S0011 | Loans extended to Non-Residents |
| 7 | 3S0101 | Advance payment against imports |
| 8 | 3S0102 | Payment towards imports – settlement of invoice |
| 9 | 3S0103 | Imports by diplomatic missions |
| 10 | 3S0104 | Intermediary trade |
| 11 | 3S0190 | Imports below Rs.5,00,000 – (For use by ECD offices) |
| 12 | 3SO202 | Payment for operating expenses of Indian shipping companies operating abroad |
| 13 | 3SO208 | Operating expenses of Indian Airlines companies operating abroad |
| 14 | 3S0212 | Booking of passages abroad – Airlines companies |
| 15 | 3S0301 | Remittance towards business travel |
| 16 | 3S0302 | Travel under basic travel quota (BTQ) |
| 17 | 3S0303 | Travel for pilgrimage |
| 18 | 3S0304 | Travel for medical treatment |
| 19 | 3S0305 | Travel for education (including fees, hostel expenses etc.) |
| 20 | 3S0401 | Postal services |
| 21 | 3S0501 | Construction of projects abroad by Indian companies including import of goods at project site |
| 22 | 3S0602 | Freight insurance – relating to import and export of goods |
| 23 | 3S1011 | Payments for maintenance of offices abroad |
| 24 | 3S1201 | Maintenance of Indian embassies abroad |
| 25 | 3S1202 | Remittances by foreign embassies in India |
| 26 | 3S1301 | Remittance by non-residents towards family maintenance and savings |
| 27 | 3S1302 | Remittance towards personal gifts and donations |
| 28 | 3S1303 | Remittance towards donations to religious and charitable institutions abroad |
| 29 | 3S1304 | Remittance towards grants and donations to other Governments and charitable institutions established by the Governments |
| 30 | 3S1305 | Contributions or donations by the Government to international institutions |
| 31 | 3S1306 | Remittance towards payment or refund of taxes |
| 32 | 3S1501 | Refunds or rebates or reduction in invoice value on account of exports |
| 33 | 3S1503 | Payments by residents for international bidding. |
7. Sequence:
8. Mandatory Required Information by Client to file form 15CA & CB:
- Details of Remitter:
- Details of Remittee:
- Details of Remittance:
a. Country to which Remittance is made
b. Currency in which remittance is made
c. Amount in INR
d. Proposed date of Remittance
e. Nature of Remittance as per agreement(invoice copy by client)
- Bank Details of Remitter:
a. Name of Bank of Remitter
b. Name of Branch of the bank
c. BSR Code of Bank
- Documents from the Remittee:
a. Form 10F duly filled by authorize person of remittee.
b. Tax residence certificate from Remittee (Tax registration of country in which remittee is registered)
c. Certificate that the remittee does not have any permanent establishment in India.
Conclusion
Form 15CA and Form 15CB play a crucial role in ensuring compliance with income tax regulations for remittances to non-residents. By understanding the purpose and requirements of these forms, individuals and entities can fulfill their obligations and avoid penalties. Remember to provide the mandatory information when filing, and be aware of the exemptions outlined in the regulations. Stay informed and compliant to facilitate smooth international transactions while adhering to tax guidelines.
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