Basic Understanding on Form 15CA and 15CB

Form 15 CA

What is the need of Form 15CA and Form 15CB?

  • Earlier, a person making a remittance to Non-Resident Indian was needed to provide a certificate in specified format circulated by RBI.
  • The primary purpose was to collect the taxes at a stage when the remittance is made as it may not be easy to collect the tax from the NRI at a later stage.
  • Hence to monitor and track the transactions in an effective manner, it was proposed to begin e-filing of information in the certificates.

Rules applicable to submission of Form 15CA/Form CB

Form 15CA and Form 15CB rules changed effectively from April 1, 2016, and in some matters, the requirement to provide these forms has been eliminated or made more comfortable. Earlier these forms were mandatory when remitting funds out of India, presently under the new rules, now the forms have been simplified and also the necessity for submission of these forms in some cases has been eliminated.

Indian Income-tax (IT) department rules for preparation and submission of the Form 15CA and Form 15CB from April 1, 2016, for:

  • Transferring from NRO account to NRE account.
  • Where an NRI is remitting money outside India
  • Making a payment to an NRI or Foreigner

Form 15CA has been updated and now has 4 parts (Part A, Part B, Part C & Part D) read below as to which parts are used under which specific circumstances

When making a payment to a foreign company or an NRI, as per the rules of the income tax department the following information must be provided:

An amount for submission Rupees 5 lakh or less

When the money that is taxable in India, where the entire amount of such payments during the year is Rs. 5 lakh or less, the information in Part A of Form 15CA must be provided.

An amount for submission more than Rupees 5 lakh

  • A certificate from Assessing Officer under Section 197
  • An order from assessing officer under section 195(2) or 195(3)
  • Part B of the Form 15 has to be provided
  • Certificate in the Form 15CB from an accountant
  • Part C of the Form 15CA

Note: The CA certificate in the Form 15CB where required should be submitted electronically

In a situation where the amount is not taxable under the current Indian tax act

  • Part D of Form 15CA

Form 15CA and 15CB will NOT be needed for

  • Any payments covered in the specified list. The nature of payment in the specified list has been extended from 28 to 33 including payments for imports, family maintenance as well as savings.
  • Any amount by a person for remittance which does not require RBI approval under its LRS (Liberalized Remittance Scheme).

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Basic Understanding on Form 15CA and 15CB

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