Form 15CA/15CB

Concept behind applicability of Form 15CA and

15CB

• The Income Tax Law of our country requires authentication of

foreign remittances (payments) made to a Non Resident or Foreign
Company, for any amount which is taxable as per the existing
laws. For this purpose, certain rules and guidelines have been
framed by the Income Tax Act for making foreign remittances.
• Sec 195(1) - Any person responsible for paying to a non-resident,
not being a company, or to a foreign company, any interest shall,
at the time of credit of such income to the account of the payee
or at the time of payment thereof in cash or by the issue of a
cheque or draft or by any other mode, whichever is earlier, deduct
income-tax thereon at the rates in force
Concept behind applicability of Form 15CA and
15CB

• Sec 195(6) - The person responsible for paying to non-resident

(other than a company) or to a foreign company, any sum whether
it is chargeable under the Income Tax Act or not, shall furnish the
information relating to payment of such sum, in such form (15CA &
15CB) and manner (Rule 37BB) as may be prescribed.
Salient Features of Rule 37BB are as under:

• Information has to be furnished in relation to any payment to a

non-resident, whether chargeable to tax in India or not;
• Reporting need to be done only at the time of payment
irrespective of the fact whether TDS has been deducted in the
past or a position has been adopted for not deducting tax
• Following are the cases or list where the 15CA/CB form is not
required to filled:
• the remittance is made by an individual and it does not require prior
approval of Reserve Bank of India and any sum which is not chargeable
under the provisions of the Act
• the remittance is made by a Unit of an International Financial Services
centre
• The remmitance is of the nature as per the following table and which is not chargeable
under the provisions of the Ac:

S no. Nature of Payment

1 Indian investment abroad - in equity capital (shares)
2 Advance payment against imports
3 Payment towards imports - settlement of invoice
4 Remittance towards business travel
5 Travel for education (including fees, hostel expenses, etc.)

• For the full list click the below link

https://incometaxindia.gov.in/_layouts/15/dit/Pages/viewer.aspx?path=https://income
taxindia.gov.in/Rules/Income-Tax%20Rules/103120000000007406.htm&IsDlg=0
Form 15CA

• Form 15CA is a declaration made by the person remitting the money

wherein he states that he has deducted the tax from any payments so
made to the nonresident.
• The idea behind deduction of the taxes at source and their subsequent
reporting is to ensure that taxes are collected on time.
• Authorized Dealers/Banks are now becoming more vigilant in ensuring
that such forms are received by them before remittance is affected,
since now as per the revised Rule 37BB, a duty is casted on them to
furnish Form 15CA (received from the remitter) to an income-tax
authority for the purpose of any proceedings under the Income-tax Act.
Form 15CA

Part A Part D
• Remittance does not exceed INR 5 • Remittance is not taxable under the
Lakh and amounts chargeable to tax provision of the Income Tax Act other
• CA certificate in form 15CB is not than payments referred in Rule 37BB(3)
required by the person referred in Rule 37BB(2)
A D

B C

Part B Part C
• Remittances exceed INR 5 Lakh and • Remittance does exceed INR 5 Lakh
amounts to chargeable to tax or order u/s and amounts chargeable to tax under
195(2)/195(3)/197 has been obtained from provision of the Income Tax Act
the Income Tax Officer • CA Certificate in form 15CB is required
• CA certificate in form 15CB is not required
Form 15CB

• Form 15CB is a certificate to the furnished by an accountant in

case where in cases where any payment/aggregate of payments
exceeding INR 5 Lakhs in a FY chargeable to income tax is made to
a non-resident (not being a company) or a foreign company, and a
certificate from the assessing officer u/s 195/197 is not obtained
• In other words, Form 15CB is a tax determination certificate in
which the CA examines the remittance with regards to
chargeability provisions
• In form 15CB, a CA certifies the details of the payment, TDS rate,
TDS deduction and other details of nature and purpose of
remittance.
With the help of the below chart, you can define when form 15CB/15CA is required to be
filed.
 Income Tax Act or DTAA

Assessee

Whichever is more beneficial

IT Act DTAA

So in order to avoid TDS deduction under section 206AA we need Following documents are required for claiming benefit
to consider Rule 37BC which says that section 206AA will not be of DTAA:
applicable if non- resident provides the following documents: Tax Residency Certificate of base country
Name, E-mail id, Contact no Form 10F duly filled by the authorized person of the
Address in the country or specified territory outside India of remittee.
which deductee is a resident Self declaration regarding no PE in India (In case of
Certificate of his being resident in any country or specified business income)
territory outside India from the Government of that country
Tax Identification Number of the deductee in the country or
specified territory of his residence
 Details Required for filing Form 15CB/CA

Details of Remitter Details of Remittee Details of Remittance Bank details of the Remitter
1. Name of Remitter 1. Name of Remittee 1. Country to which remittance is 1. Name of Remittee
2. Address of Remitter 2. Pan of Remittee (if any) made 2. Pan of Remittee (if any)
3. PAN of Remitter 3. Address of the Remittee 2. Currency in which remittance is 3. Address of the Remittee
4. Principal place of 4. Country of the Remittee made 4. Country of the Remittee
business of remitter 3. Amount of remittance in Indian
5. Principal Place of the 5. Principal Place of the business of
5. E-mail address and phone business of the Remittee Currency
no of remitter the Remittee
4. Proposed date of remittance
6. Status of the remitter
5. Nature of Remittance
(Co/LLP/Firm etc.)
6. Purpose code

If the remittee (non-resident) claims the benefit of DTAA then before filling form 15CB, form 10F and Tax residency certificate (TRC) are
required from the remittee.
Procedure for filing form 15CB

• Make classification of Transaction (Business Income, Capital Gain,

Interest, Royalty, Fee for Technical service etc.)
• Verify the factual and basic documents (Eg: Invoice, Aggrement,
legal status, PAN in India
• Check whether payment is covered under Domestic law
• Check taxability as per DTAA u/s 90(4)/90(5)
 Procedure for filing form 15CB

Step Action by Action Description

Step 1 Taxpayer Login to e-Filing Portal. Navigate to “My Chartered Accountant(s)” functionality under
Authorised Partners menu. Add CA by providing the Membership Number. Assign Form by
selecting Form 15CB, Financial Year and click ‘Add’. This is a one-time appointment to be
made every Financial Year
Step 2 CA Login to e-Filing portal. Navigate to “e-File” menu and select File Forms sub-menu.
Step 3 CA Select Form 15CB appearing under File Forms sub-menu.
Step 4 CA On selection of Form 15CB, User ID and PAN of CA is auto populated. Provide PAN/TAN of the
assessee to whom certificate in Form 15CB is required to be issued, Filing Type, Submission
Mode “Online” and Financial year.
Step 5 CA Click Continue. Navigate to Form 15CB Instructions Screen. Prepare Form 15CB and generate
Preview. Proceed to e-Verify and submit under Digital Signature Certificate (DSC) of CA. An
Acknowledgement Number is generated for Form 15CB. Downloadable PDF of Form 15CB will
be made available in view filed forms. No acknowledgement will be generated till taxpayer
files a valid 15CA quoting the acknowledgement number of 15CB.
Key Points to remember while filing form 15CB/CA

• For the purpose of TDS, the exchange rate is required as on the

date on which the tax is required to be deducted and the
exchange rate shall be the buying rate adopted by the State Bank
of India
• Grossing up net of tax payments
In case the tax chargeable on any income is to be borne by the payer, then,
for the purposes of withholding of taxes under section 195 such income shall
be increased to such amount as would, after withholding of tax thereon at the
rates in force, be equal to the net amount payable to payee.
For example: If the amount payable is INR 1,00,000 and tax rate in force is
20% and the tax is borne by the payer then TDS is required to deduct as
follows:
Grossing – 1,00,000/80*100 = 1,25,000
TDS amount – 1,25,000*20% = 25,000
Consequences of Non-Filing

Non-filing of Form 15CA/15CB leads to a penalty under section 271-I

of the Income Tax Act.
• The penalty of Rs. 1,00,000 upon failure to furnish Information /
furnishing inaccurate information.
• However, as per provisions of section 237B of the Income Tax Act,
no penalty can be imposed under section 271-I, in case the
defaulter proves the reasonable cause for the failure.
Thank You