Académique Documents
Professionnel Documents
Culture Documents
CA Manish S. Savalkar
1. Why Form 15CA?
Form 15CA is a Declaration of Remitter and is used as a tool for collecting information in
respect of payments which are chargeable to tax in the hands of recipient non-resident.
This is starting of an effective Information Processing System which may be utilized by
the Income tax Department to independently track the foreign remittances and their
nature to determine tax liability. Authorised Dealers/ Banks are now becoming more
vigilant in ensuring that such Forms are received by them before remittance is effected
since now as per revised Rule 37BB a duty is casted on them to furnish Form 15CA
received from remitter, to an income-tax authority for the purposes of any proceedings
under the Income-tax Act.
2. Whether Form 15CA has to be submitted in all cases since the Bankers
demand it invariably?
In this regards the attention is invited to the Headings of the Form which provides as
under:
Information to be furnished for payments, chargeable to tax, to a non-resident not
being a company, or to a foreign company
(To be filled up if the remittance is chargeable to tax and does not exceed fifty
thousand rupees and the aggregate of such remittances made during the financial year
does not exceed two lakh fifty thousand rupees)
(Underlined for emphasis)
As can be seen from above the Form clearly states that it needs to be filled only if the
remittance is chargeable to tax in India. Therefore on the first blush it appears
crystal clear that Form 15CA is not required to be filled if the remittance/
payment to non-resident are not chargeable to tax. However the confusion has
been created to Banks since a list As per Income Tax (Fourteenth Amendment) Rules,
2013, No reporting in Form 15CA and 15CB is to be made in case of the following nature
of foreign remittances w.e.f 01.10.2013 has been provided in Rule 37BB.
SPECIFIED LIST
Sl
.
N
o.
Purpose
code as
per RBI
S0001
S0002
S0003
S0004
S0005
S0011
S0202
S0208
S0212
10
S0301
11
S0302
12
S0303
13
S0304
14
S0305
15
S0401
Postal services
16
S0501
17
S0602
18
S1011
19
S1201
20
S1 202
21
S1301
22
S1302
23
S1303
24
S1304
25
S1305
26
S1306
27
S1501
28
S1503
Therefore no Form 15CA and 15CB are required in the abovementioned 28 nature of
foreign remittances.
3. What stand customer can take if Bank demand Form 15CA but service is not
taxable?
In such cases, the possible recourse is to submit a declaration in form of a note to Bank
stating the nature of remittance and reason as to why it is not chargeable to tax and
consequently exempted from the submission of Form 15CA.
4. Why Form 15CB?
The answer is Form 15CB. Chargeability can be ascertained and certified by obtaining the
Certificate from a Chartered Accountant in Form no. 15CB. This certificate has been
prescribed under Section 195(6) of the Income tax Act and is an alternate channel of
obtaining Tax clearance apart from Certificate from Assessing Officer.
Perusal of Form 15CB makes it clear that there is no condition or exemption to
obtain such certificate when the remittance is not chargeable to tax. In fact this
Form 15CB 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 with the Recipients
Residence Country. Therefore in my opinion, it is advisable to obtain 15CB even in cases
where 15CA is not mandated. Though there is no penal provision prescribed in the Act if
such Certificates 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, since
Non-resident taxation involves various complex issues and the consequences of Non
deduction are severe.
5. Once it is ascertained that Form 15CA and 15CB have to be made then one
should ascertain the part of Form 15CA to be filled by the assessee, by reading
the following extracts of Amended Rule 37BB;
Rule 37BB. (1) Any person responsible for paying to a non-resident, not being a company,
or to a foreign company, any interest or salary or any other sum chargeable to tax under
the provisions of the Act, shall furnish the following, namely:
(i) the information in Part A of Form No.15CA, if the amount of payment does not exceed
fifty thousand rupees and the aggregate of such payments made during the financial
year does not exceed two lakh fifty thousand rupees;
(ii) the information in Part B of Form No.15CA for payments other than the payments
referred in clause (i)
6. Information to be required from the client
A. Details of Remitter
1. Name of the Remitter
2. Address of the Remitter
3. PAN of the Remitter
4. Principal Place of Business of the Remitter
5. E-Mail Address and Phone No. Of Remitter
6. Status of the Remitter (Firm/Company/Other)
B. Details of Remittee
1. Name and Status of the Remittee
2. Address of the Remittee
3. Country of the Remittee (Country to Which Remittance Is Made)
4. Principal Place of the Business of the Remittee
C. Details of the Remittance
1. Country to Which Remittance Is Made
2. Currency in Which Remittance Is Made
3. Amount of Remittance in Indian Currency
4. Proposed Date of Remittance
5. Nature of Remittance as Per Agreement (Invoice Copy to Be Asked From Client)
D Bank Details of the Remitter
1. Name of Bank of the Remitter
2. Name of Branch of the Bank
3. BSR Code of the Bank
E. Others
1. Fathers Name of the Signing Person
2. Designation Of The Signing Person
F
b. Tax Residency Certificate From The Remittee (Tax Registration Of The Country In Which
Remittee Is Registered)
c. Certificate That The Remittee Does Not Have Any Permanent Establishment In India.
This Is Mandatory If The Income Is A Business Income And Not Chargeable To Tax As Per
DTAA If There Is No P.E In India.
This Is Required If Any Benefit Under DTAA Is Taken, Whether By Way Of Lower Rate Of
Deduction Of Tax At Source Or No Deduction Of Tax At Source As Per DTAA.
This Is Required If Any Benefit Under DTAA Is Taken, Whether By Way Of Lower Rate Of
Deduction Of Tax At Source Or No Deduction Of Tax At Source As Per DTAA.
7. What are the impacts of new Rule (applicable from 1st October, 2013)?
a.
Department added 28 types of payments for which no information is required to be
furnished at all.
b. Form 15CB is not required where Part A of Form 15CA is to be filled in, i.e., in case of
small payments.
c.
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.
d. Sub-rule (2) of the revised Rule 37BB mandates that Form 15CA shall be furnished to
the authorised dealer prior to remitting the payment.
e.
The revised Rule 37BB casts a duty on the authorised dealer to furnish Form 15CA
submitted by the remitter to an income-tax authority for the purposes of any proceedings
under the Income-tax Act.
f.
The revised Forms state that in the absence of the PAN of the recipient, provisions of
section 206AA shall apply.
g. The revised Form 15CB requires detailed enumeration of the taxability of the amount
under the Income-tax Act, without giving any effect to the DTAA. Where DTAA provisions
are sought to be applied, the details of the Tax Residency Certificate, applicable DTAA
and its relevant article, as also tax liability under the DTAA are to be furnished. The
nature of remittance is divided as for royalties, FTS, interest, dividend; on account of
business income; on account of short-term and long-term capital gains; and any other
remittance.
(The author can be reached at manish.savalkar@gmail.com or on +91 9833862440 for
any queries)