FILING OF FORM 15CA & 15CB IN CASE OF REMITTANCE(S) TO THE NON-RESIDENTS
Nowadays, trade is not limited to one own’s country only. But in this globalised economy, it is very easy to trade with different countries. And with the help of digital net banking, it is also very easy to settle the payment for the trade or services provided between different nations.
As per the Indian Income Tax Act, any payment/services on which TDS is applicable, the payment to the party should be done after deducting TDS.
If any payment is made outside India, then there is one problem that the tax cannot be collected from them at a later stage. Therefore, to track this type of transaction, where any payment is made to the Non – Residents, filing of Form 15CA and 15CB introduced.
As per Section 195 of Income Tax Act, 1961 which mandates the deduction of Income Tax from payments made to Non-Resident. The person who is making the remittances (Remitter) to the non-resident needs to furnish an undertaking in Form 15CA accompanied by a Chartered Accountants Certificate in Form 15CB.
WHAT IS FORM 15CA?
Form 15CA is a type of declaration of remitter, in which remitter gives the information about his organisation and bank details through which the payment is being remitted. It also contains the information for nature of payment and what amount in Foreign Currency is being remitted. Also, remittee (Non-Resident) details are mentioned in this Form.
When a person desires to remit any money to non-resident, the bank do check whether the tax was paid or not. If tax is not paid in the form of TDS, it will be checked if it is certified by the Chartered accountant or the Assessing Officer. Bank asks for Form 15CA/15CB as a document of genuine transactions.
The furnishing of information Form 15CA has been classified into 4 parts –
PART A: – If the remittances is chargeable to tax under Income Tax Act, 1962 and the remittance or the aggregate of such remittance does not exceed Rs. 5 Lakh during the Financial Year.
PART B: – Where remittance is chargeable to tax and the remittance or the aggregate of remittances exceeds Rs. 5 Lakh 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.
PART C: – Where remittance is chargeable to tax and the remittance or the aggregate of remittances exceeds Rs. 5 Lakh during the financial year and a certificate in Form No. 15CB has been obtained.
PART D: – Where the remittance is not chargeable to tax under Income Tax Act, 1961.
WHAT IS FORM 15CB?
Form 15 CB (Certificate of an accountant) is a Form which is required to be signed by a Chartered Accountant. This is a kind of certification in which remitter & remittee personal information is mentioned. This certificate also mentioned the Nature of Transaction, Amount of Remittance (in Foreign Currency & INR), TDS rates.
Form 15CB is the certificate where the CA Examines the remittance chargeability as per the provisions under Section 5 and 9 of the Income Tax Act along with the provisions of the Double Tax Avoidance Agreements.
Upload of Form 15CB is mandatory to file Part C of Form 15CA. To prefill the details in Part C of form 15CA, the Acknowledgement Number of e- verified form 15CB should be verified.
EXEMPTION TO PAYMENT/REMITTANCES, WHERE FORM 15CA & 15CB IS NOT REQUIRED?
Individual don’t need to furnish the information in Form 15CA and 15CB for remittance which requires no RBI approval.
As per Rule 37BB following is the List of payments (33 items) which does not require compliances and reporting through the submission of 15CA and 15CB: –
|Nature of Payment||Purpose code as per RBI|
|Indian investment abroad – in equity share capital||S0001|
|Indian investment abroad – in debt securities||S0002|
|Indian investment abroad – in wholly owned subsidiaries or branches||S0003|
|Indian investment abroad – in subsidiaries and associates||S0004|
|Indian investment abroad – in real estate||S0005|
|Loans extended to Non-Residents||S0011|
|Advance payment against imports||S0101|
|Payment towards imports- settlement of invoice||S0102|
|Imports by diplomatic missions||S0103|
|Imports below Rs.5,00,000- (For use by ECD offices)||S0190|
|Operating expenses of Indian shipping companies operating abroad.||S0202|
|Operating expenses of Indian Airlines companies operating abroad||S0208|
|Booking of passages abroad -Airlines companies||S0212|
|Remittance towards business travel.||S0301|
|Travel under basic travel quota (BTQ)||S0302|
|Travel for pilgrimage||S0303|
|Travel for medical treatment||S0304|
|Travel for education (including fees, hostel expenses etc.)||S0305|
|Construction of projects abroad by Indian companies and also including import of goods at project site||S0501|
|Freight insurance in relate import and export of goods||S0602|
|Payments for maintenance of offices abroad||S1011|
|Maintenance of Indian embassies abroad||S1201|
|Remittances by foreign embassies in India||S1202|
|Remittances for family maintenance and savings by the non-residents||S1301|
|Remittance towards personal gifts and donations||S1302|
|Remittances towards donations to religious and charitable institutions abroad||S1303|
|Remittances to other Governments and charitable institutions established by the Governments as grants and donations||S1304|
|Remittances towards Contribution or donations by the Government to international institutions||S1305|
|Remittances for payment or refund of taxes.||S1306|
|Rebates or Refunds or reduction in invoice value on account of exports||S1501|
|Payments by residents for international bidding.||S1503|
You can also read my coming suggested related articles on:-
- Procedure of filing of Form 15CA & 15CBs.
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