Not only individuals but banks and financial institutions must follow certain rules that give the Income Tax Department an edge in determining taxable amounts for non-resident Indians. This article will guide you through Form 15CA Income Tax, the filing process, documents, and gits of form 15CB.
What is Form 15CA?
Form 15CA is a remitter’s declaration and is intended as a tool for gathering information related to payments taxable to non-resident payees. This is the dawn of an effective information processing system that the Income Tax authorities use to independently track overseas remittances and their nature to determine tax liability.
Approved merchants/banks must submit Form 15CA (received from the remitter) to the Income Tax Authority under Rule 37BB, and therefore must file such a form before the remittance is made. Form 15CA must be submitted online to the tax office. Next, you will need to print proof of your online application. This copy must be presented to the bank as proof of tax payment by the tax department.
What are parts of form 15CA?
Parts of Form 15CA are:
Part A – Part A of the form must be filed if the remittance amount is taxable under the Income Tax Act, 1961 and the total amount of the remittance is Rs.5 lakhs for that particular financial year.
Part B – Part B of Form 15CA must be completed if the remittance amount is Rs.5 lakhs in a financial year. and Income Tax Act order/certificate u/s 195(2)/195(3)/197 from A.O. (either zero rate or low rate certificate).
Part C- Part C of Form 15CA must be filled if the remittance amount within the financial year exceeds Rs. 5 lakhs and a certificate on Form No. 15CB was obtained from the certified public accountant specified in Section 288, subsection (2)
Part D – File Part D of Form 15CA if the transfer is not taxable, except for payments made under Rule 37BB(3) by persons referred to in Rule 37BB(2).
You must upload Form 15CB before filing Part C of Form 15CA. To provide details in Part C of Form 15CA, you must include the electronically filed Form 15CB Acknowledgment Number. File form 15CB only if the remittance amount exceeds Rs 5 lakh during the financial year.
What is Form 15CB?
A 15CB is a tax determination certificate that CA checks remittances against the credit requirements of Sections 5 and 9 of the Income Tax Act and the provisions of Double Tax Avoidance Agreements. CA certifies payments under Section 195 of the Income Tax Act to which the DTAA applies, TDS rates, details of TDS deductions, and details of the nature and purpose of the remittance.
It is mandatory to upload Form 15CB before filing Part C of Form 15CA. To pre-populate the details for Part C of Form 15CA, you must validate your electronically validated Form 15CB acknowledgment number.
How to file Income Tax Form 15CA?
Follow these steps to file form 15CA:
Step 1: Visit the Income Tax Portal.
Step 2: Log in to your account with the appropriate login credentials.
Step 3: Click on the e-File tab >> select the Income Tax Forms tab from the drop-down menu.
Step 4: Select Form 15CA and click Continue.
Step 5: Select the Type of Form 15CA applicable from the drop-down menu.
Step 6: To complete the process, fill out Form 15CA and click the Submit button.
Once the process is complete, the user will receive an on-screen message indicating successful filing and a confirmation on the registered email.
How can I manually upload 15CA in income tax?
Form 15CA Submission Process (submitted by the taxpayer or tax Deductor)
Step 1: Fill out form 15CA in the downloaded offline utility for forms filed manually earlier and generate XML (s). XML files to zip into a folder.
Step 2: Login as a Taxpayer or Tax Deductor at www.incometax.gov.in
Step 3: Go to Menu >> Electronic File >> Income Tax Forms >> File Income Tax Forms and select Form 15CA. Click on the Manual radio button >> Continue button.
Step 4: Upload the zip file using attach files option in the Upload Manual Bulk Form menu and submit using the preferred electronic authentication method.
What are the documents required for forms 15CA and 15CB?
Documents needed for Form 15 CA and Form 15 CB
Details of Remitter
- Name of Remitter
- Remitter’s Address
- Remitter’s PAN Number
- Principal Place of Business of the Remitter
- E-mail ID of the Remitter and Phone Number
- Status of the Remitter
Details of Remittee
- Name and Status of Remittee
- Address of the Remittee
- Principal Place of Business
- Country of the Remittee
Details of the Remittance
- Destination Country of Remittance
- Currency used for remittance
- Amount of Remittance in Indian currency
- Proposed Date of Remittance
Bank Details of the Remitter
- Name of Bank of Remitter
- Name of Branch of Bank
- BSR Code of the Remitter’s Bank
Which payments do not require the filing of forms 15CA and 15CB?
Individuals are not required to provide information on Forms 15CA and 15CB for remittances that require no RBI approval. Filing 15CA and 15CB on the list of payments referred to in Rule 37BB (33 items) eliminates compliance and reporting requirements. The types of this remittance are
| Purpose code as per RBI | Nature of Payment |
| S0001 | Indian investment abroad -in equity capital (shares) |
| S0002 | Indian investment abroad -in debt securities |
| S0003 | Indian investment abroad -in branches and wholly owned subsidiaries |
| S0004 | Indian investment abroad -in subsidiaries and associates |
| S0005 | Indian investment abroad -in real estate |
| S0011 | Loans extended to Non-Residents |
| S0202 | Payment- for operating expenses of Indian shipping companies operating abroad. |
| S0208 | Operating expenses of Indian Airlines companies operating abroad |
| S0212 | Booking of passages abroad -Airlines companies |
| S0301 | Remittance toward business travel |
| S0302 | Travel under basic travel quota (BTQ) |
| S0303 | Travel for pilgrimage |
| S0304 | Travel for medical treatment |
| S0305 | Travel for education (including fees, hostel expenses, etc.) |
| S0401 | Postal services |
| S0501 | Construction of projects abroad by Indian companies including import of goods at the project site |
| S0602 | Freight insurance – relating to the import and export of goods |
| S1011 | Payments for maintenance of offices abroad |
| S1201 | Maintenance of Indian embassies abroad |
| S1202 | Remittances by foreign embassies in India |
| S1301 | Remittance by non-residents toward family maintenance and-savings |
| S1302 | Remittance toward personal gifts and donations |
| S1303 | Remittance towards donations to religious and charitable institutions abroad |
| S1304 | Remittance towards grants and donations to other governments and charitable institutions established by the Governments |
| S1305 | Contributions or donations by the government to international institutions |
| S1306 | Remittance towards payment or refund of taxes |
| S1501 | Refunds or rebates or reduction in invoice value on account of exports |
| S1503 | Payments by residents for international bidding |
Why 15CA is filed?
Before, anyone sending money to a non-resident had to provide a certificate in the form prescribed by the RBI. This happened because everyone earning income in India also has to pay taxes to the Indian government.
In addition, the main purpose was to collect tax at the time of remittance or as TDS, as it may not be possible or impractical to collect tax later from non-residents.
As a result, the government has introduced electronic filing of Forms 15CA and 15CB instead of certificates to efficiently monitor transactions and collect taxes.
Income tax deductions for payments to non-residents are currently required by Section 195 of the Income Tax Act of 1961. An undertaking (Form 15CA) and Chartered Accountant Certificate (Form 15CB) must be provided by the person sending the payment to the non-resident individual or entity.
What if form 15CA is not filed?
Assessees who are required to file Forms 15CA and 15CB fail to file Forms 15CA and 15CB before remittances to non-residents will be subject to penalties under Section 271 of the Income Tax Act 1961. The penalty clause also applies if the person provides inaccurate information.
Further, if the assessee fails to file Forms 15CA and 15CB in compliance, the assessee may direct the assessing officer to bear the consequences and pay a fine of Rs.100,000.
FAQ- Form 15ca Of Income Tax
1. Is Form 15 CA mandatory?
Any person responsible for making payments to a non-resident non-corporation or foreign corporation must provide this information on Form 15CA.
2. How long is forms 15CA valid?
There is no time limit for filing this form. However, file it before the transfer.
3. Can we file 15CA without a digital signature?
No, you cannot form 15CA without a digital signature.
4. Can we withdraw 15CA?
Yes, you can withdraw Form 15CA within 7 days from the date of submission.
5. How do I verify 15CA?
This form can be verified electronically using DSC or EVC.
Wrapping Up
In conclusion, Form 15CA of income tax is a necessary document for any individual or entity making payments to non-residents. If you are receiving taxable funds from individuals in India, please ensure that the remitter has filed Forms 15CA and 15CB with the Income Tax Authority of India. If these forms are not submitted, the sender’s bank may not be able to process the high-value remittance request.