Everything About Forms 15CA and 15CB

As per the provisions outlined in Section 195 of the Income Tax Act, any amount that is deemed taxable under the Act necessitates a deduction of tax. Therefore, when a person intends to remit money to a non-resident, the bank has a legal obligation to ensure that the tax has been paid. If the tax hasn’t been paid, the bank will investigate whether the payment has been certified by a CA or the Assessing Officer.

While it is true that submitting Form 15CA and Form 15CB is generally mandatory for foreign remittances, it is worth noting that there are certain exceptions to this rule. Specifically, there are 28 types of foreign remittances that do not require the submission of these forms. This article aims to provide a deeper understanding of Forms 15CA and 15CB. So, without further ado, let’s delve right into it!

What is Form 15CA?

Form 15CA is an important declaration that remitters need to provide to the Income Tax Department while making foreign remittances. This declaration helps the tax authorities to collect information regarding payments that are taxable in the hands of the non-resident recipient. The Income Tax Department uses this information to track foreign remittances and determine the tax liability of the recipient. To ensure compliance, authorised dealers and banks now require the submission of Form 15CA before remittances are made.

The latest revision of Rule 37BB has cast a duty on them to furnish this form to the tax authorities. To simplify the filing process, the Income Tax Department has introduced an online facility to file Form 15CA. To provide evidence of tax clearance, it is essential to submit a printout of the proof of online submission to the bank after completing the submission process. This helps to streamline the process and ensure that remittances are made in a legally compliant manner.

What is Form 15CB?

Form 15CB is a document that needs to be endorsed by a CA, and serves as a certification of the correct tax rate and payment for the payer. Meanwhile, Form 15CA requires certain information from Form 15CB to be completed when filing. It is important to note that some people may believe that Form 15CA is unnecessary if the payment to a non-resident Indian is not taxable. However, the Income Tax Rules of 2013 have outlined exceptions to this rule, as detailed in Rule 37BB. As a result, no reporting is required for certain types of foreign remittances since October 2013.

How to File Form 15CA and 15CB Online?

The process of filing Form 15CA and 15CB online involves several steps. Here’s a brief overview of the procedure:

1. Visit the official website of the Income Tax Department and select the ‘e-File’ option.
2. Click on the ‘Login’ button and enter your login credentials to access your account.
3. Select the ‘e-File’ option and click on ‘Income Tax Forms’ from the drop-down menu.
4. Choose the relevant form, i.e., Form 15CA or 15CB, and fill in the required details.
5. Once you have filled in all the necessary information, submit the form online.
6. After submission, download the acknowledgement receipt and take a printout.
7. Obtain the necessary certification from a Chartered Accountant on Form 15CB.
8. Submit the printout of the acknowledgement receipt and Form 15CB to the bank to provide evidence of tax clearance.

It is worth noting that the precise steps for online filing may differ depending on the updates to the portal or platform being used.

What’s the Difference Between Form 15CA and 15CB?

What Documents Needed for Form 15CA and Form 15CB?

When it comes to making foreign remittances, complying with Indian tax laws is of utmost importance. This means ensuring that you have filed Form 15CA and Form 15CB, which are mandatory for such transactions. To help you with this process, it is important to know which documents are required for these forms.

For Form 15CA, you will need to provide details such as the name and address of the remitter and the beneficiary, the amount of remittance, the purpose of remittance, and the bank account details of the beneficiary. In addition, you will need to furnish a self-declaration stating that the information provided is true and accurate to the best of your knowledge.

For Form 15CB, you will need to obtain a certificate from a Chartered Accountant (CA) who will verify the details provided in Form 15CA and ensure that the appropriate tax has been paid on the remittance. The CA will also examine the relevant documents, such as invoices, agreements, and contracts, to determine the correct tax rate applicable to the transaction.

In addition to the above, you may also need to provide other documents as per the specific requirements of your bank or the tax authorities. These may include PAN card copies, bank statements, and copies of invoices or agreements related to the transaction.

By keeping these documents handy and seeking the assistance of a CA, you can ensure that your foreign remittances are compliant with Indian tax laws and avoid any penalties or legal hassles.

Remittances that Don’t Require Form 15CB

1. Exemption from Form 15CB is applicable if the payment made during a financial year does not exceed Rs. 5 lakhs, as mentioned in Part-A of Form 15CA.

2. Form 15CB is not mandatory if a certificate has been obtained from the AO under section 197 or 195(2) / (3).

3. The requirement of Form 15CB does not apply if the sum payable is not taxable under the provisions of the Income Tax Act.

4. No information needs to be provided for any amount that is not taxable under the Act, as per the provisions of the Foreign Exchange Management Act, 1999, read with Schedule III to the Foreign Exchange (Current Account Transactions) Rules, 2000, for remittances made by individuals.

5. Form 15CB is not necessary for remittances falling under the nature specified in Rule 37BB.

Payment / Remittances don’t require 15CA & 15CB?

Individuals are exempted from providing information through Form 15CA and Form 15CB for remittances that do not require approval from the Reserve Bank of India. Rule 37BB includes a list of 33 payment categories that do not require compliance and reporting via the submission of

Form 15CA and Form 15CB. The nature of those payments is listed below:

Is 15CA required for transfer from NRO to NRE?

If a remitter is transferring funds from an NRO account to an NRE account, it is compulsory for them to provide both Form 15CA and Form 15CB to the bank branch.

Final Thoughts

Understanding Forms 15CA and 15CB can be overwhelming, but it’s essential to know this information in order to stay in good standing with the government and avoid any penalties or fees. They outline the requirements of paying overseas parties or bringing money into India from abroad. When it comes time to complete these forms, make sure you have all the necessary documents and information ready. Doing so will help ensure a streamlined process when filing with the Indian Income Tax Department.