Compliances to be made in respect of foreign remittances often gets one’s pulse racing, gets one all jittery and shaky, cause the process involves not just regular money, but foreign money.
Compliance, in itself, often gets people shivering in their boots, thanks to the inherent human tendency to panic whenever anything is submitted for approval or clearance from authorities who most often appear intimidating. However, this article is a humble attempt to put to rest those fears and ensure a smooth process of submission and compliance.
Through a press release dated 14th June 2021, the income tax department has relaxed the requirement of furnishing Form 15CA/15CB electronically on the new e-filing portal www.incometax.gov.in. The taxpayers can submit the said forms in manual format to the authorised dealers till 30th June 2021.
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, 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.
Applicability of Form 15CA and Form 15CB
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
The form is divided into four parts, to be filled based on the scenario that is prevalent at the time. The four parts are:
To be filled irrespective of whether taxable or not and the remittance or its aggregate does not exceed Rs. 5 lakh in a financial year.
To be filled when the Certificate under Section 195(2)/195 (3)/197 of the Income Tax Act has been obtained from the Assessing Officer.
To be filled when the remittance or its aggregate exceeds Rs. 5 lakh in a financial year and that remittance is chargeable to tax.
Is filled when as per the domestic laws, the remittance is not chargeable to tax.
Procedure to File Form 15CA and 15CB Online
Step-by-Step Process to File Form No. 15CA—Part A, B and D (Online mode)
Form No. 15CA is filed electronically on the Income Tax e-filing portal and is verified either using a digital signature or electronic verification code (EVC).
First, you are required to add your Chartered Accountant
Select ‘Authorised Partners’ tab, click on ‘My Chartered Accountant (CA) from the drop-down menu
You will be directed to a page ‘My Chartered Accountant(s)’. Click on ‘Add CA’
You will then be prompted to add the ‘Membership Number of the CA’
Click on ‘Add’ and you would be required to give a ‘Confirmation’
A message displaying ‘Request for adding CA has been submitted successfully, it is pending for acceptance by the CA’ will appear
Process of e-filing Form No. 15CA
Go to the ‘eFile’ tab and select ‘Income Tax Returns’, click on ‘File Income Tax Forms’
You will be directed to a page ‘File Income Tax Forms’, click on ‘Others (Source of Income not relevant)’ and choose Form No. 15CA. Alternatively, you can also type Form No. 15CA in the search box and locate it
Now on the ‘Instructions’ page, click on ‘Let’s Get Started’
In the page ‘Information for payment to Non-Resident’, enter the ‘Filing type’, that is ‘Original/Revised’ and select the financial year and click on ‘Continue’
From Part A, B and C, you are required to select the applicable part in Form No. 15CA.
For example, Part A is applicable where remittance is below Rs 5 lakh during a financial year.
Similarly, Part B is applicable when you have received assessing officer (AO) approval under Section 195(2), 195 (3) or 197.
On the other hand, Part C is applicable in cases where the remittance or the aggregate of such remittance exceeds Rs 5 lakh during a financial year and a certificate in Form No. 15CB from an accountant required.
Finally, Part D is applicable where remittance is not taxable under the ITA and no withholding tax is required to be deducted.
You need to enter details of the remitter (sender), remittee (recipient), and remittance (fund transfer details). There is no requirement for Form No. 15CB from a CA. Finally, you would be required to submit the verification
In Part B as well, you are required to key in details related to remitter, remittee and remittance. The only difference is that you need to provide AO Order details as well. Also, there is no requirement for Form No. 15CB
In Part-C, you would be required to furnish details about the chartered accountant (CA) and related attachments. This is apart from the remittee and remittance details
After filling in all the relevant details, you are required to click on ‘Assign to CA’
Once you click on ‘Yes’ to give your confirmation, a message will come up stating ‘Assigned to the CA successfully’
Go to the Dashboard and click on ‘Pending Actions’
You will be able to see Form No. 15CB, which your CA has uploaded. You can either accept or reject Form No. 15CA
If you click on ‘Accept’, you will be directed to the ‘e-Verify page’. Once you have e-verified the Form No. 15CA using DSC or EVC, a message ‘Submitted Successfully’ will pop up
In Part D, you will be required to key in details about the remitter, which includes name, PAN, remitter status, residential status, contact and address details. In Part D, verification of the person submitting Form No. 15CA is also required. Click on the ‘Save’ option
You need to furnish the details of remittee. Followed by this, you would need to give the remittance details
Finally, ‘Verify’ the details and click on ‘Preview’
After cross-checking all the details under ‘Preview’, you are required toe-Verify the form using a digital signature certificate (DSC).
Once the e-Verification process is complete, a success message is displayed with a Transaction ID and Acknowledgement Number. You are required to keep a note of the Transaction ID and Acknowledgement Number. A confirmation message will be sent on your email ID and mobile number registered with the income tax e-filing portal
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.
The user account of the CA must be registered on the site as a CA and not as a regular account.
On the “Downloads” page, the Form 15CB Utility has to be downloaded. This is because the .xml file needs to be uploaded for the successful submission of the Form 15CB.
Once the download is complete, the .xml file has to be prepared offline and ready for upload.
On the site, under the “e-File” option, click on the “Upload Form” button and enter the following details:
PAN of the Assessee
PAN of the CA
Form Name – 15CB
Filing Type – Original
Next, the prepared .xml file is to be uploaded and generated through the Utility.
The DSC Management Utility has to be downloaded as well. This is beneficial in uploading the Digital Signature File in order for the submission to be complete in all respects.
Click on the “Submit” button and await the Success page.
View the form:
Once the Form 15CB has been uploaded and successfully submitted by the CA, the assessee may then log in and view the form under the “Worklist” tab by selecting the “For Your Information” button.
The status of the Form will be displayed as the case may be.
The submission of forms such as these, in reality, aren’t as complicated and tedious as they are normally believed to be. Moreover, the option of withdrawing the form presents the opportunity to retract the form when necessary.
Frequently Asked Questions
Is it mandatory to file Form 15CB prior to the filing of Form No. 15CA (Part-C)?
Yes, to prefill the details in Part-C of Form No. 15CA, the Acknowledgement Number of e-Verified Form No. 15CB should be verified.
What types of documents are required while filing of Form No. 15CA?
Invoice, tax residency certificate (TRC), the agreement between the parties and Form No. 10F.
What will happen in case of non-compliance with Form No. 15CA and Form No. 15CB?
In case of contravention, a penalty of Rs 1 lakh can be imposed by the assessing officer (AO).
Who is required to file Form 15CA?
Any person not being a company, who is responsible for paying to a non-resident or a foreign company should furnish such information the required information Form 15CA.
When is the form 15CA not required to be furnished?
The information in Form 15CA is not required to be furnished for the following transactions:
Remittance made by an individual that does not require prior approval of the RBI
Remittance is of the nature specified under the relevant purposes code as per the RBI
Is it compulsory to submit Form 15CB?
No, it is not compulsory to submit Form 15CB. Form 15CB is an event-based form that is to be filled only when the remittance amount exceeds Rs.5 lakh during a financial year and you are required to furnish an accountant certificate defined as per Section 288 of the Income Tax Act, 1961.
Who can use Form 15CB?
Form 15CB is submitted and accessed by a Chartered Accountant (CA) registered on the e-Filing portal. The taxpayer must assign Form 15CA to the CA in order to be able to certify the details in Form 15CB.
Is it compulsory to file Form 15CB before filing Part-C of Form 15CA?
Yes, uploading of Form 15CB is compulsory prior to the filling of Part C of Form 15CA. The acknowledgement number of the e-verified Form 15CB should be verified for prefilling the details in Part C of Form 15CA.
How should Form 15CB be verified?
The Form 15CB can only be e-verified using the Digital Signature Certificate (DSC). The DSC of the CA should be registered on the e-Filing portal. There is no prescribed time limit for submitting Form 15CB. But, it must be submitted before the remittance is made.
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