All remittances of foreign nature done to a Non-resident follow the National rules strictly. There are several taxations on the slabs and amounts for the remittance. One needs to Form 15CA to make a remittance online. In case the person uses Form 15CB for remittance, he/she needs to have a certificate from a chartered accountant.
The use of Form 15CB is to determine the amount for a tax deduction as per all the income tax protocols. You can also use Form 15CB to avoid any chances of double tax provision. In case the remittance is taxable, there is an additional TDS charge on the amount. The Form 15CB mainly includes information on the details of the remittee, remitter details, remittance nature like royalty, salary, commission as per the agreement between both sides, Tax Residency Certificate, and Bank details of the remitter from the remitter in case DTAA (Double Taxation Avoidance Agreement) is applicable.
Form 15CA - Definition
Form 15CA is a Declaration of Remitter. Additionally, you can consider the form to be a tool for collecting all information that comes in line with payments that are taxable. These payments are taxable for the recipient Non-residential Indians. The Form 15CA starts the entire process for an effective Information Processing System. The Income Tax Department of India can later freely track foreign remittances and their sources. All the information combines into one report system can help them determine the tax liability for the non-residents of India.
As per the revised Rule 37BB, a duty is implied on financial institutes to furnish Form 15CA. Therefore, the financial institution receives the form from the remitter and forwards it to the income-tax authority for the proceedings. For this reason, financial institutes are more cautious in seeking such Forms before the remittance is effected.
Importance of Form 15CA
Any Non Residential Indian is required to fill the form with some prevailing conditions. The conditions are simple and easily comprehensible.
The conditions are: - “(To be filled up if the remittance is chargeable to tax and does not exceed fifty thousand rupees and the aggregate of such remittances made during the financial year does not exceed two lakh fifty thousand rupees).”
Hence, it is clear the non-residents of India do not need to fill the Form 15CA if the remittance or payment to the non-resident is not taxable.
Contents of Form 15CA
Form 15CA is divided into sections based on different scenarios. The remitter needs to read the form and fill in their appropriate details according to their relevant sections.
Sections of Form 15CA
● Part A - Section A of Form 15CA is made for situations when the total payment amount paid by the remitter to the recipient in a Financial year is less than or equal to Rs. 5 Lakhs.
● Part B - Section B of Form 15CA is used for situations when the NRI recipient receives more than Rs. 5 Lakhs every year. The information of Section B is filled according to the certificate or order obtained from the Assessing Officer, which is valid under Section 197 and Section 195(2) andamp; Section 195(3), respectively.
● Part C - If there are payments that exceed the Rs. 5Lakh margin for one Financial Year, the related information is filled in Section C of the Form 15CA. The section is filled after obtaining the tax Determination Certificate or Form 15CB from an authorized Chartered Accountant under Section 288(2).
● Part D - Section D of the form is for remitters who have made payments in a particular Financial Year that do not refer to any riles in Sub-section 37BB. Since the amount is not taxable under law, there are no tax deductions, but the Income-Tax act ensures a record of all payments made.
NOTE - The Form 15CB is only needed when a remitter makes payments that exceed Rs. 5 Lakh in a year under the Income-tax Act 1961.
How to file Form 15CA? Have a look
You can find Form 15CA on the e-filling portal of the Government of India Income Tax website. Hence, you can easily fill the form online and submit it to the concerned authorities. Here is a step-wise guide for you to fill Form 15CA:
Visit the official e-filling portal
and log in with all your valid credentials.
2. Find and select “E-file” on the Menu bar at the top of the page. Click on “Income Tax Forms.”
3. You will find the PAN details already entered.
4. Find and click on the “Form Name” drop-down menu.
5. Find and click on “Form 15CA.”
6. Select your required section from “Select relevant part from the down” and fill the form.
7. Ensure you fill all the fields in the selected part of Form 15CA and click on the “Submit” button
8. Fill in all the verification information for the Form 15CA
NOTE - Form 15CB needs to be uploaded in the portal before you start filling Section C of Form 15CA. This is important as Form 15CB has an acknowledgement number that is needed for Section C of Form 15CA.
Once you have successfully filled and submitted the form, you will receive a notification “Successfully Submitted” on your screen. You will also receive a confirmation mail to your registered e-mail address immediately.
Form 15CB - Definition
You can find and certify the liabilities of Form 15CB by getting the Certificate from a Chartered Accountant in Form 15CB. The authorized Chartered Accountant needs to prescribe the certificate under Section 195(6) of the Income-tax Act. The form is also an alternate channel to obtain Tax clearance besides the Certificate from the Assessing Officer.
Information Required from the Client to Fill Form 15CB
1. Remitter’s Details
- ○ Remitter’s Name
- ○ Remitter’s Address
- ○ Remitter’s PAN Number
- ○ Principal Place of Business of the Remitter
- ○ E-Mail Address and Phone No. Of Remitter
- ○ Status of the Remitter (Firm/Company/Other)
2. Remittee’s Details
- ○ Remittee’s Name and Status
- ○ Remittee’s Address
- ○ Remittee’s Nationality (the location for Remittance)
- ○ Business Portfolio of the Remittee
- ○ Principal Place of the Remittance
3. Remittance Details
- ○ Country of Remittance
- ○ Currency of Remittance
- ○ Amount of Remittancein Indian Currency
- ○ Proposed Date of Remittance
- ○ Nature of Remittance as Per Agreement
4. Remitter Bank Details
- ○ Name of Bank of the Remitter
- ○ Name of Branch of the Bank
- ○ BSR Code of the Bank
5. Other Important Information
- ○ Father’s Name of the Signing Person
- ○ Designation Of The Signing Person
Impacts of New Rules and Regulations in 15CA and 15CB
The new rules on 15CA and 15CB are applicable since 1st October 2013.
● Form 15CB is not necessary if the Remitter is filling Part A of Form 15CA (payments below Rs. 5 Lakhs)
● There are 28 different types of payment that do not require you to furnish any information with the forms.
● In case of payments, the Remitter requires a certificate or an order from the Assessing Officer under section 197, 195(2), or 195(3), or a Certificate from an authorized Chartered Accountant.
● Sub-rule (2) revision of Rule 37BB makes it mandatory for you to furnish Form 15CA to the authorized dealer before remitting the payment.
Processes to Fill Form 15CB for Chartered Accountants
● Visit the official Income tax e-portal and click on the “Download” tab.
● Select the required form from “Forms (Other than ITR)” and save the document in Excel or Java Utility.
● Create the XML file.
● Login to your account on the e-filing portal and click on the “E-files” tab.
● Select “Upload Form: from the drop-down menu and wait for the form to reload
● Fill in the PAN/TAN details, PAN of the C.A.
● Change the “Form Name” to “15CB” and the “Filing Type” to “Original”.
● Check all the information you filled in and click on “SUBMIT”.
You will receive a success notification on the screen, and you will also receive a successful application email on your registered email ID.