Article explains Rule 37BB of Income Tax Rules, 1962 read with Section 195 of Income Tax Act, 1961 related to furnishing of information in form 15CA and making declaration in form 15CB.
INCOME ACT, 1961:
As per Sec.195(6) of The person responsible for paying to a non-resident, not being a company, or
to a foreign company,
any sum, whether or not chargeable under the provisions of this Act, shall furnish the information relating to payment of such sum, in such form and manner, as may be prescribed.
INCOME TAX RULES:
Rule 37BB defines the manner to furnish information in form 15CA and making declaration in form 15CB .
Why Form 15CA:
It a tool for collecting data about foreign remittances. It contains all information in respect of payments made to Non-Residents.
Points of consideration:
- It is to be submitted electronically using digital signatures but may also be submitted without DSC as per procedures.
- Submission of Form 15CA is mandatory before the remittance is made.
- Signed Printouts are required to be submitted with the Authorised Dealer.
Why Form 15CB:
- It is a Channel of obtaining tax clearance apart from certificate from Assessing Officer.
- There is no condition to obtain such certificate when the remittance is not chargeable to tax. This is the Tax Determination Certificate where the Issuer CA examines the remittance having regard to chargeability provisions under section 5 and 9 of Income Tax Act along with provisions of Double Tax Avoidance Agreement (DTAA) with the Recipient’s Residence Country.
LEVELS OF INFORMATION TO BE FURNISHED(A SUMMARY):
(Differentiation on the basis of level has been done only to facilitate better understanding of the amount of information furnishable).
LEVEL 1: Nothing To Be Furnished for any sum not chargeable to tax, if:
(i) Remittances are not chargeable to tax and are specified under rule 37BB. OR
(ii) Remittances are by an Individual and No approval of RBI required under FEMA.
LEVEL 2: PART D: When remittance is not chargeable to tax(other than those covered above)
LEVEL 3: PART A: (i) When chargeable to tax and
(ii) Remittance amount < Rs. 500000
LEVEL 4: PART B: (i) When chargeable to tax,
(ii) Remittance amount > Rs. 500000 And
(iii) A.O. Order U/S 195(2), 195(3), 197 has been passed.
LEVEL 5: PART C: (i) When chargeable to tax,
(ii) Remittance Amount > 500000 and
(iii) Form 15CB also required to be furnished.
DETAILED:
LEVEL 1 :No Information To Be Furnished:(I)Remittances Specified Under Rule 37BB That Don’t Require Any Information To Be Furnished :
| 1 | Indian investment abroad – in equity capital (shares) |
| 2 | Indian investment abroad – in debt securities |
| 3 | Indian investment abroad – in branches and wholly owned subsidiaries |
| 4 | Indian investment abroad – in subsidiaries and associates |
| 5 | Indian investment abroad – in real estate |
| 6 | Loans extended to Non-Residents |
| 7 | Advance payment against imports |
| 8 | Payment towards imports – settlement of invoice |
| 9 | Imports by diplomatic missions |
| 10 | Intermediary trade |
| 11 | Imports below Rs.5,00,000 – (For use by ECD offices) |
| 12 | Payment for operating expenses of Indian shipping companies operating abroad |
| 13 | Operating expenses of Indian Airlines companies operating abroad |
| 14 | Booking of passages abroad – Airlines companies |
| 15 | Remittance towards business travel |
| 16 | Travel under basic travel quota (BTQ) |
| 17 | Travel for pilgrimage |
| 18 | Travel for medical treatment |
| 19 | Travel for education (including fees, hostel expenses etc.) |
| 20 | Postal services |
| 21 | Construction of projects abroad by Indian companies including import of goods at project site |
| 22 | Freight insurance – relating to import and export of goods |
| 23 | Payments for maintenance ofoffices abroad |
| 24 | Maintenance of Indian embassies abroad |
| 25 | Remittances by foreign embassies in India |
| 26 | Remittance by non-residents towards family maintenance and savings |
| 27 | Remittance towards personal gifts and donations |
| 28 | Remittance towards donations to religious and charitable institutions abroad |
| 29 | Remittance towards grants and donations to other Governments and charitable institutions established by the Governments |
| 30 | Contributions or donations by the Government to international institutions |
| 31 | Remittance towards payment or refund of taxes |
| 32 | Refunds or rebates or reduction in invoice value on account of exports |
| 33 | Payments by residents for international bidding. |
LEVEL 1 : Nothing To Be Furnished: (II) When No Approval Of RBI Required Under FEMA :
The remittances made by an INDIVIDUAL that don’t require prior approval of RBI, As Per Foreign Exchange (Current Account Transaction) Rules, 2000, need not furnish any information .
LEVEL 2: PART D OF FORM 15CA: [To be filled up if the remittance is not chargeable to tax under the provisions of the Income-tax Act, 1961 {other than payments referred to in rule 37BB(3)} by the person referred to in rule 37BB(2)]
Information required to be furnished under this part:
| REMITTER | REMMITEE | CURRENCY | BANK | REMITTACE |
| NAME | NAME | COUNTRY TO WHICH REMMITTANCE TO BE MADE | NAME OF BANK | DATE OF REMITTANCE |
| PAN | PAN | CURRENCY | NAME OF BRANCH | NATURE OF REMITTANCE |
| TAN | ADDRESS | AMOUNT IN FOREIGN CURRENCY | BSR CODE OF BANK | PURPOSE CODE AS PER RBI |
| ADDRESS | EMAIL & MOBILE NO. | AMOUNT IN INDIAN CURRENCY | ||
| EMAIL & MOBILE NO. | ||||
| STATUS | ||||
| RESIDENTIAL STATUS |
LEVEL 3 : PART A OF FORM 15CA: (To be filled up if the remittance is chargeable to tax under the provisions of the Income tax Act,1961 and the remittance or the aggregate of such remittances, as the case may be, does not exceed five lakh rupees during the financial year)
Information required in addition to above mentioned:
| TDS |
| AMOUNT PAYABLE BEFORE TDS |
| AMOUNT OF TDS |
| RATE OF TDS |
| DATE OF DEDUCTION |
LEVEL 4: PART B OF FORM 15CA: (To be filled up if the remittance is chargeable to tax under the provisions of the Income tax Act,1961 and the remittance or the aggregate of such remittances, as the case may be, exceeds five lakh rupees during the financial year AND an order certificate u/s 195(2)/ 195(3)/ 197 of Income-tax Act has been obtained from the Assessing Officer.)
Information required in addition to already mentioned:
| A.O.ORDER |
| SECTION UNDER WHICH ORDER/CERTIFICATE HAS BEEN OBTAINED |
| NAME & DESIGNATION OF ASSESSING OFFICER WHO ISSUED THE ORDER/CERTIFICATE |
| DATE OF ORDER/CERTIFICATE |
| ORDER/CERTIFICATE NUMBER |
NOTE:
- SECTION 195(2): Where the person responsible for paying any such sum chargeable under this Act (other than salary) to a non-resident considers that the whole of such sum would not be income chargeable in the case of the recipient, he may make an application to the Assessing Officer to determine, by general or special order, the appropriate proportion of such sum so chargeable, and upon such determination, tax shall be deducted under sub-section (1) only on that proportion of the sum which is so chargeable.
- SECTION 195(3) Any person entitled to receive any interest or other sum on which income-tax is deductible under section(1), may make an application to the Assessing Officer for the grant of a certificate authorising him to receive such interest or other sum without deduction of tax.
- SECTION 197: (1) Where, income-tax is required to be deducted at, at the time of payment at the rates in force under the provisions of sections 192, 193, 194, 194A, 194C, 194D, 194G, 194H, 194-I, 194J, 194K , 194LA ,194LBB, 194LBC] and 195, the Assessing Officer is satisfied that the total income of the recipient justifies the deduction of income-tax at any lower rates or no deduction of income-tax, the Assessing Officer shall, give to him such certificate as may be appropriate.
LEVEL 5: PART C OF FORM 15CA: (To be filled up if the remittance is chargeable to tax under the provisions of Income-tax Act, 1961 and the remittance or the aggregate of such remittances, as the case may be, exceeds five lakh rupees during the financial year AND a certificate in Form No. 15CB from an accountant.)
Information required in addition to already mentioned:
| REMITTER | REMMITEE | ACCOUNTANT | TAXES | DTAA* |
| PRINCIPAL PLACE OF THE BUSINESS | PRINCIPAL PLACE OF THE BUSINESS | Name of the Accountant signing the certificate | RELEVANT SECTION APPLICABLE | APPLICABILITY OF DTAA |
| AREA CODE | STATUS | Name of the proprietorship/firm of the accountant | AMOUNT OF TAXABLE INCOME | RELEVANT DTAA |
| RANGE CODE | Country to which remittance is made | Registration No. of the accountant | TAX AMOUNT | RELEVANT ARTICLE OF DTAA |
| Date of certificate | BASIS OF DETREMING TAXABLE INCOME AND TAX LIABILITY |
*DTAA- Double Tax Avoidance Agreement
**Infact, this part C of Form 15CA includes all particulars of Form 15CB in itself.
Practical Aspects Of Form 15CA And 15CB (An Extract):
- Submission of FORM 15CB is mandatory before the Submitting FORM 15CA.
- FORM 15CA gives the details about the remittances Rather the FORM 15CB is an assurance as to whether the applicable provisions of Income tax act and DTAA are being followed or not.
- There is no penal provision prescribed in the Act if such Certificate in Form 15CB and Declaration in Form 15CA are not obtained, but it is in the interest of assessee to have a tax determination in Form 15CB from a CA.
- If contrary to LEVEL 1, the remittance is chargeable to tax, then declaration in form 15CA would be compulsory irrespective of the fact that the remittance is specified one out of those mentioned under Rule 37BB.
Proofs Required to be Disclosed:
- Tax residency certificate
- Certificate that the remittee does not have any permanent establishment in India.
(Republished after amendment by Taxguru Team)
Author Bio
Hi , I am OCI card hold ( overseas citizen of India). I sold some property last year (2019) that I previously purchased many years back when I was a Indian citizen. I got a from 15CA and 15CB and had the proceeds remitted to a NRO account. Now a year later when I am trying to repatriate those funds from my NRO account to the USA the bank says the forms 15CA and 15CB are more than 30 days and need to be re-filed or reissued.
1) Is it possible to re-file reissue 15CA/15CB, My CA says its not feasible to re-file reissue the same
2) Does the forms 15CA/15CB expire ? Any reason the bank (ICICI) is asking me to re-file ?
3) Is there a problem with re-filing these forms ? I don’t want the IT dept to think I have new income based on refiling these forms
Would appreciate your response in this matter very much
Dear Sir, Good Afternoon
We are operating our business under Merchant Trade Transaction. We do not import or export any goods in India. It means the goods do not touch Indian territory but directly dispatched to third country. For better understanding we can say, if our supplier is based at UK and buyer is based at USA, than supplier will directly ship goods to USA. Means shipping directly from UK to USA.
Purpose code are Export – P0108 – Goods sold under merchanting /receipt against export leg of merchanting trade and Import – S0108 – Goods acquired under merchanting /payment against import leg of merchanting trade.
Therefore for this Trade 15 CA & 15CB FORMS are required to be submitted in Bank !! do we have circular from RBI.
AND also pls advise if GST will be applicable ???
The income tax department has revised the rules relating to preparation & submission of Form 15CA and Form 15CB (see old rules of Form 15CB ). Revised rules became effective from 1st April 2016. The significant changes are as follows –
• Form 15CA and 15CB will be NOT be required to be furnished by an individual for remittance, which does not require RBI approval
• List of payments of specified nature mentioned in Rule 37BB, which do not require submission of Forms 15CA and 15CB, has been expanded from 28 to 33 including payments for imports.
• Form No. 15CB will only be required for payments made to non-residents, which are taxable and if the payment exceeds Rs. 5 lakhs.
But banks mostly ask for 15CA and 15CB/
What is correct legal position ?
Dear Sir,
Is required to file form 15CA / CB against payment in foreign currency to a resident.
Because we have received service invoice in USD from SEZ service provider. They ask make the payment in only USD.
Please give your reply on the same.