Forms 15CA & 15CB

Forms 15CA & 15CB

Brief Introduction with Their Importance

As per Section 195 of the Income Tax Act 1961, every person liable for making a payment to non-residents shall deduct TDS from the payments made or credits given to non-residents at the rates in force.  The Reserve Bank of India also mandates that except in cases of certain personal remittances which have been specifically exempted, no remittance should be made to a non-resident without furnishing an undertaking in Form 15CA accompanied by a certificate from an Accountant in Form 15CB

The purpose of this undertaking and certificate is to collect taxes at the stage when the remittance is made as it may not be possible to recover the tax at a later stage from the non-residents. The format of the undertaking in Form 15CA which is to be filed electronically and the format of the certificate of the Accountant in Form 15CB have been notified vide Rule 37BB of the Income Tax Rules 1962. 

Form 15CA

Any payments made by a resident to a non-resident has to be reported under the Income Tax Act. The idea behind deduction of the taxes at source and their subsequent reporting is to ensure that taxes are collected on time. 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 non-resident.

Form 15CB

Form 15CB, however, is not a declaration, but a certificate issued by a Chartered Accountant ensuring that the provisions of the Double Taxation Avoidance Agreement and the Income Tax Act have been complied with in respect of tax deductions while making the payments. It includes the following:
  • Details and nature of payment made to a Non Resident.
  • Compliance with Section 195 of the Income Tax Act.
  • Rate of TDS deducted.
  • Applicability of the Double Taxation Avoidance Agreement.

What is the need of 15CA and 15CB

  • Earlier, the person making a remittance to Non-Resident was required to furnish a certificate in specified format circulated by RBI.
  • Basic purpose was to collect the taxes at a stage when the remittance is made as it may not be possible to collect the tax from the Non-Resident at a later stage.
  • Thus to monitor and track the transactions in an efficient manner, it was proposed to introduce e-filling of information in the certificates.
  • Section 195 of Income tax act, 1961 mandates the deduction of Income tax from payments made to Non Resident. The person making the remittance to non – resident needs to furnish an undertaking (in form 15CA) accompanied by a Chartered Accountants Certificate in Form 15CB.

Applicability of Form 15CA and Form 15C​​​B

  • If the amount of remittance is not chargeable to tax, then no forms are required.
  • If the remittance is covered under a specified exemption list, then only Part D of the Form 15CA is to be submitted.
  • Where remittance is less than Rs. 5 lakh in a particular financial year – Only Form 15CA – Part A to be submitted.
  • Where remittance exceeds Rs. 5 lakh – Form 15CA – Part C and Form 15CB to be submitted.
  • Where remittance exceeds Rs. 5 lakhs and a certificate under Section 195(2)/195 (3)/197 of the Income Tax has been obtained – Form 15CA – Part B to be submitted.

Parts of Form 15CA​​​

  • Part A – Section A of Form 15CA is filled in by the remitter when the payment or the total sum of the payment extended by the remitter to NRI recipient during a perticular Financial Year is Rs. 5 Lakhs or less.
  • Part B – Section B of Form 15CA is in the role when such payments are more than Rs. 5 Lakhs. Information is entered by the filer in Section B after acquiring a certificate from Assessing Officer (valid under section 197) or the order from Assessing Officer (valid under sub-section (2) or sub-section (3) of section 195).
  • Part C – If such payments made during a particular FY exceed Rs. 5 Lakhs, the related information has to be entered in Section C of Form 15CA after acquiring the Tax Determination Certificate or Form 15CB from authorized CA (valid under sub-section (2) of section 288).
  • Part D – Payments made by the remitter during a particular FY which is not referred to in sub-section 37BB or in other words is not taxable under law, the information related to such payments is to be entered in Section D of Form 15CA.
Note: Form 15CB is required to be filled only when the remittance exceeds Rs 5 Lakh in the said fiscal under the income tax act 1961.

Procedure for furnishing Form 15CA

Form 15CA is available online on the government’s official income tax e-filing portal. The form is electronically submitted to concerned authorities. Here is the step-wise guidance to file Form 15CA:

  • Step 1 Visit the official E-filing ‘ portal at Income Tax and log in by using the valid credentials.
  • Step 2– Select ” E-file” from the menu placed at the top of the page and then click on Income Tax Forms. 
  • Step 3– The PAN details of the taxpayer is pre-filled. Choose “Form 15CA” from the drop-down list named “Form Name”. 
  • Step 4– Select your required section from “Select relevant part from the down “
  • Step 5– Fill the selected part of Form 15CA and click on the “submit” button.
  • Step 6– Fill the details in the verification portion of the respective part of Form 15CA.
Please Note–  Form 15CB needs to be uploaded before you fill Part C of Form 15CA as the acknowledgment number of Form 15CB is required while filing the respective part. 
Once the form is successfully filled, a notification “successfully submitted” will pop up on the screen along with a confirmation email sent to the registered email account.

View and Withdrawal of Form 15CA

  1. View Form 15CA – Click on “My Account” and then on “View Form 15CA”.
  2. Withdrawal – While on the View page, under the Status column, there will be a “Withdraw Form 15CA” option. This option is exercisable only within 7 days of the submission of the form.

The common fields in the Form 15CA include

  • Name of the Remitter
  • Address details
  • Contact information
  • Residential status of the Remitter
  • Name of the recipient of the remitter
  • PAN (if available)
  • Details of remittance
  • Details of TDS
  • Verification of the form.

CA can fill in Form 15CB through the below-mentioned procedure

  • The “Add CA” requisite has to be completed first.
  • Under the “My Account” tab, the “Add CA” option is to be selected.
  • Here, the Membership Number of the CA has to be entered.
  • The Form number is to be entered next as 15CB.
  • Since the CA has now been added successfully, the rest of the process may be completed by the CA himself.
  • Visit Income Tax and click on the “Downloads” tab.
  • Select the required “Forms (Other than ITR)” and then convert them either in Excel or Java Utility (whichever is suitable).
  • Create the XML file using your chosen utility. 
  • Login to the account on the e-filing portal and click on the “e-File” tab. Select “Upload Form” from the drop-down menu. 
  • Fill in the PAN/TAN details of the assessee, PAN of C.A., select “Form Name” as “15CB“, and “Filing Type” as “Original”. Press ‘submit’
    As soon as you press the submit button you will receive a success notification along with an email sent to your registered email ID.

Highlighting Impacts of New Rule on 15CA & 15CB

Note: Applicable since 1st October, 2013

  • Form 15CB is not required where Part A of Form 15CA is to be filled in, i.e. in case of small payments.
  • 28 types of payments for which no information is required to be furnished at all along with the form.
  • In case of other payments, it appears that either an order or a certificate of the Assessing Officer u/s. 197/195(2)/195(3) must be obtained, or a certificate of the Chartered Accountant should be obtained.
  • Sub-rule (2) of the revised Rule 37BB mandates that Form 15CA shall be furnished to the authorized dealer prior to remitting the payment.

For more info visit TAXAJ
Posted by Ramesh Kumar Gupta

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