Form 15CA & 15CB, Its Provisions, Related Rules and Filing

Rule 37BB defines the manner to furnish information in form 15CB and making declaration in form 15CA .  Why Form 15CA: It a tool for collecting data about foreign remittances.  It contains all information in respect of payments made to Non-Residents. 

INCOME ACT, 1961:

As per Sec.195(6) of The person responsible for paying to a non-resident, not being a company, or

to a foreign company,

any sum, whether or not chargeable under the provisions of this Act, shall furnish the information relating to payment of such sum, in such form and manner, as may be prescribed. 

INCOME TAX RULES:

Rule 37BB defines the manner to furnish information in form 15CB and making declaration in form 15CA . 

Why Form 15CA:

It a tool for collecting data about foreign remittances.  It contains all information in respect of payments made to Non-Residents. 

Points of consideration:

It is to be submitted electronically using digital signatures but may also be submitted without DSC as per procedures. 

Submission of Form 15CA is mandatory before the remittance is made. 

Signed Printouts are required to be submitted with the Authorised Dealer. 

Why Form 15CB:

It is a Channel of obtaining tax clearance apart from certificate from Assessing Officer. 

There is no condition to obtain such certificate when the remittance is not chargeable to tax.  This is the Tax Determination Certificate where the Issuer CA examines the remittance having regard to chargeability provisions under section 5 and 9 of Income Tax Act along with provisions of Double Tax Avoidance Agreements(DTAA) with the Recipient’s Residence Country. 

LEVELS OF INFORMATION TO BE FURNISHED(A SUMMARY):

(Differentiation on the basis of level has been done only to facilitate better understanding of the amountof information furnishable). 

LEVEL 1: Nothing To Be Furnished for any sum not chargeable to tax, if:

(i)Remittances are not chargeable to tax and are specified under rule 37BB.  OR

(ii)Remittances are by and Individual and No approval of RBI required under FEMA. 

LEVEL 2:PART D: When remittance is not chargeable to tax(other than those covered above)

LEVEL 3:PART A: (i) When chargeable to tax and

(ii)Remittance amount < 500000

LEVEL 4:PART B: (i) When chargeable to tax,

(ii)Remittance amount > 500000 And

(iii) A.O. Order U/S 195(2), 195(3), 197 has been passed. 

LEVEL 5:PART C: (i) When chargeable to tax,

(ii) Remittance Amount > 500000 and

(iii) Form 15CB also required to be furnished. 

DETAILED:

LEVEL 1 :No Information To Be Furnished:(I)Remittances Specified Under Rule 37BB That Don’t Require Any Information To Be Furnished :

1

Indian investment abroad – in equity capital (shares)

2

Indian investment abroad – in debt securities

3

Indian investment abroad – in branches and wholly owned subsidiaries

4

Indian investment abroad – in subsidiaries and associates

5

Indian investment abroad – in real estate

6

Loans extended to Non-Residents

7

Advance payment against imports

8

Payment towards imports – settlement of invoice

9

Imports by diplomatic missions

10

Intermediary trade

11

Imports below Rs.5,00,000 – (For use by ECD offices)

12

Payment for operating expenses of Indian shipping companies operating abroad

13

Operating expenses of Indian Airlines companies operating abroad

14

Booking of passages abroad – Airlines companies

15

Remittance towards business travel

16

Travel under basic travel quota (BTQ)

17

Travel for pilgrimage

18

Travel for medical treatment

19

Travel for education (including fees, hostel expenses etc.) 

20

Postal services

21

Construction of projects abroad by Indian companies including import of goods at project site

Remittance towards grants and donations to other Governments and charitable institutions established by the Governments

30

Contributions or donations by the Government to international institutions

31

Remittance towards payment or refund of taxes

32

Refunds or rebates or reduction in invoice value on account of exports

33

Payments by residents for international bidding. 

LEVEL 1 : Nothing To Be Furnished: (II) When No Approval Of RBI Required Under FEMA :

The remittances made by an INDIVIDUAL that don’t require prior approval of RBI, As Per Foreign Exchange (Current Account Transaction) Rules, 2000, need not furnish any information . 

LEVEL 2: PART D OF FORM 15CA: [To be filled up if the remittance is not chargeable to tax under the provisions of theIncome-tax Act, 1961 {other than payments referred to in rule 37BB(3)} by the person referred to in rule 37BB(2)]

Information required to be furnished under this part:

REMITTER

REMMITEE

CURRENCY

BANK

REMITTACE

NAME

NAME

COUNTRY TO WHICH REMMITTANCE TO BE MADE

NAME OF BANK

DATE OF REMITTANCE

PAN

PAN

CURRENCY

NAME OF BRANCH

NATURE OF REMITTANCE

TAN

ADDRESS

AMOUNT IN FOREIGN CURRENCY

BSR CODE OF BANK

PURPOSE CODE AS PER RBI

ADDRESS

EMAIL & MOBILE NO. 

AMOUNT IN INDIAN CURRENCY

EMAIL & MOBILE NO. 

STATUS

RESIDENTIAL STATUS

LEVEL 3 : PART A OF FORM 15CA: (To be filled up if the remittance is chargeable to tax under the provisions of the Income tax Act,1961and the remittance or the aggregate of such remittances, as the case may be, does not exceed five lakh rupees during the financial year)

Information required in addition to above mentioned:

TDS

AMOUNT PAYABLE BEFORE TDS

AMOUNT OF TDS

RATE OF TDS

DATE OF DEDUCTION

LEVEL 4: PART B OF FORM 15CA: (To be filled up if the remittance is chargeable to tax under the provisions of the Income tax Act,1961 and the remittance or the aggregate of such remittances, as the case may be, exceeds five lakh rupees during the financial year AND an order certificate u/s 195(2)/ 195(3)/ 197 of Income-tax Act has been obtained from the Assessing Officer.) 

Information required in addition to already mentioned:

A.O.ORDER

SECTION UNDER WHICH ORDER/CERTIFICATE HAS BEEN OBTAINED

NAME & DESIGNATION OF ASSESSING OFFICER WHO ISSUED THE ORDER/CERTIFICATE

DATE OF ORDER/CERTIFICATE

ORDER/CERTIFICATE NUMBER

NOTE:

SECTION 195(2): Where the person responsible for paying any such sum chargeable under this Act (other than salary) to a non-resident considers that the whole of such sum would not be income chargeable in the case of the recipient, he may make an application to the Assessing Officer to determine, by general or special order, the appropriate proportion of such sum so chargeable, and upon such determination, tax shall be deducted under sub-section (1) only on that proportion of the sum which is so chargeable. 

SECTION 195(3) Any person entitled to receive any interest or other sum on which income-tax is deductible under section(1), may make an application to the Assessing Officer for the grant of a certificate authorising him to receive such interest or other sum without deductionof tax. 

SECTION 197: (1) Where, income-tax is required to be deducted at, at the time of payment at the rates in force under the provisions of sections 192, 193, 194, 194A, 194C, 194D, 194G, 194H, 194-I, 194J, 194K , 194LA ,194LBB, 194LBC] and 195, the Assessing Officeris satisfied that the total income of the recipient justifies the deduction of income-tax at any lower rates or no deduction of income-tax, the Assessing Officer shall, give to him such certificate as may be appropriate. 

LEVEL 5: PART C OF FORM 15CA: (To be filled up if the remittance is chargeable to tax under the provisions of Income-tax Act, 1961 and the remittance or the aggregate of such remittances, as the case may be, exceeds five lakh rupees during the financial year AND a certificate in Form No.  15CB from an accountant.) 

Information required in addition to already mentioned:

REMITTER

REMMITEE

ACCOUNTANT

TAXES

DTAA*

PRINCIPAL PLACE OF THE BUSINESS

PRINCIPAL PLACE OF THE BUSINESS

Name of the Accountant signing the certificate

RELEVANT SECTION APPLICABLE

APPLICABILITY OF DTAA

AREA CODE

STATUS

Name of the proprietorship/firm of the accountant

AMOUNT OF TAXABLE INCOME

RELEVANT DTAA

RANGE CODE

Country to which remittance is made

Registration No.  of the accountant

TAX AMOUNT

RELEVANT ARTICLE OF DTAA

Date of certificate

BASIS OF DETREMING TAXABLE INCOME AND TAX LIABILITY

*DTAA- Double Tax Avoidance Agreement

**Infact, this part C of Form 15CA includes all particulars of Form 15CB in itself. 

Practical Aspects Of Form 15CA And 15CB (An Extract):

Submission of FORM 15CB is mandatory before the Submitting FORM 15CA. 

FORM 15CA gives the details about the remittances Rather the FORM 15CB is an assurance as to whether the applicable provisions of Income tax act and DTAA are being followed or not. 

There is no penal provision prescribed in the Act if such Certificate in Form 15CB and Declaration in Form 15CA are not obtained, but it is in the interest of assessee to have a tax determination in Form 15CB from a CA. 

If contrary to LEVEL 1, the remittance is chargeable to tax, then declaration in form 15CA would be compulsory irrespective of the fact that the remittance is specified one out of those mentioned under Rule 37BB. 

Proofs Required to be Disclosed:

Tax residency certificate

Certificate that the remittee does not have any permanent establishment in India.