What is Form 15CA and why do we have to file it?
Form 15CA is basically a declaration form to be filed by the person who is responsible to remit or send a certain amount to a specific person outside India.
Why Form 15CA is required to be filed?
Income Tax Department has imposed this compliance on all the remitters in order to keep track on all the foreign remittances & their respective taxability.
As per Rule 37BB, every authorized bank is bound to ensure that all such forms are received by them prior making any foreign transfers.
Is it necessary to submit Form 15CA on all the foreign remittances?
Form 15CA is required to be filled only where the amount payable is subject to income tax in India. If any amount which is not subject to tax than no Form 15CA shall be required. To make it more clear, Form 15CA is required when liability of income tax arises.
What is Form 15CB and Why is it necessary to file?
A person making payments to a Non Resident or a Foreign company has to submit Form 15CA. This certificate can be submitted through Income tax department online portal. However, in a few cases a Certificate from a practicing Chartered Accountant in Form 15CB is required before uploading Form 15CA online.
The Chartered Accountant is required to certify details such as nature and purpose of the remittance or transfer, TDS Rate applicability on it, TDS must have been deducted under section 195 of Income Tax Act 1961, If any Double Taxation Avoidance Agreement(DTAA) is applicable or not.
Cases where 15CA and 15CB is not required to be filed?
List of 33 Items has been prescribed in Rule 37BB in which the remittances are not required to be filed with Form 15CA and Form 15CB.
Here’s the list of those 33 Items
|S.No||Purpose code as prescribed by RBI||Nature of Payment|
|1||S0001||Indian investment abroad – in equity capital (shares)|
|2||S0002||Indian investment abroad – in debt securities|
|3||S0003||Indian investment abroad – in branches and wholly owned subsidiaries|
|4||S0004||Indian investment abroad – in subsidiaries and associates|
|5||S0005||Indian investment abroad – in real estate|
|6||S0011||Loans extended to Non-Residents|
|7||S0101||Advance payment against imports|
|8||S0102||Payment towards imports – settlement of invoice|
|9||S0103||Imports by diplomatic missions|
|11||S0190||Imports below Rs.5,00,000 – (For use by ECD offices)|
|12||SO202||Payment for operating expenses of Indian shipping companies operating abroad|
|13||SO208||Operating expenses of Indian Airlines companies operating abroad|
|14||S0212||Booking of passages abroad – Airlines companies|
|15||S0301||Remittance towards business travel|
|16||S0302||Travel under basic travel quota (BTQ)|
|17||S0303||Travel for pilgrimage|
|18||S0304||Travel for medical treatment|
|19||S0305||Travel for education (including fees, hostel expenses etc.)|
|21||S0501||Construction of projects abroad by Indian companies including import of goods at project site|
|22||S0602||Freight insurance – relating to import and export of goods|
|23||S1011||Payments for maintenance of offices abroad|
|24||S1201||Maintenance of Indian embassies abroad|
|25||S1202||Remittances by foreign embassies in India|
|26||S1301||Remittance by non-residents towards family maintenance and savings|
|27||S1302||Remittance towards personal gifts and donations|
|28||S1303||Remittance towards donations to religious and charitable institutions abroad|
|29||S1304||Remittance towards grants and donations to other Governments and charitable institutions established by the Governments|
|30||S1305||Contributions or donations by the Government to international institutions|
|31||S1306||Remittance towards payment or refund of taxes|
|32||S1501||Refunds or rebates or reduction in invoice value on account of exports|
|33||S1503||Payments by residents for international bidding.|