Filing of Form 15CA and 15CB- An overview
Filing of Form 15CA and 15CB
In order to transfer a payment to a foreign company or outside
India, it is necessary to abide by various rules and regulations.
According to Section 195 of
the Income-tax Act, 1961, any person who pays money to a non-resident,
including foreign companies is required to deduct income tax. Further, one of
the requirements for making payment outside India is filling of form 15CA and 15CB.
What
are Form 15CA and 15CB?
The
main objective of filing the form 15CA and 15CB is to collect taxes as soon as
the remittance is made, because it becomes more difficult to collect taxes from
non-residents later.
For
that reason, forms 15CA and 15CB were electronically filed in order to monitor
and check the effectiveness of such transactions.
Form 15CA:
Form 15CA states that a person remitting money to a non-resident
has deducted the tax from those payments.
Form 15CB:
Form
15CB is issued by a Chartered Accountant to ensure that the tax deduction rules
have been followed during the payment process.
●
Information about the payment made to a
non-resident.
●
Income tax compliance with Section 195.
●
Tax properly Deducted
●
Whether Double taxation avoidance
agreements apply.
When is Form 15CA not
applicable?
●
Rules 37BB of the Income
Tax Rules require the remitter to remit based on the list of payments.
●
Section 5 of the Foreign
Exchange Management Act, 1999 does not apply to individuals who do not need RBI
approval.
When
is Form 15CB not applicable?
● For remittances which are not taxable.
● Income in a recipient's country of residence
may be taxable
● If the total remittances during the year does
not exceed Rs. 5,00,000, then Form 15CA and 15CB are not required.
Form 15CA Components
● Part A –
If the remittance exceeds the threshold amount of 5 lakh rupees in the F.Y. and
is chargeable to tax under the Income Tax Act.
● Part B -
Form 15CA - Section B is used where payment amounts exceed Rs. 5 lakhs. The
filer enters information in Section B after obtaining a certificate from the
Assessing Officer (valid under section 197) or an order from the Assessing
Officer (valid under sub-section (2) or sub-section (3) of section 195).
● Part C –
A Form 15CB from a Chartered Accountant is required if the remittance is tax
deductible under the Income Tax Act and does not exceed 5 lakh rupees during
the financial year.
● Part D –
Is filled whenever remittances are not taxable under domestic laws.
Guidelines of
filing form 15CA?
You can
access the form 15CA online on the government’s official income tax e-filing
portal. This will be electronically submitted to concerned authorities.
Step-wise
guidance to file Form 15CA is as under:
●
Step 1- Access the official portal for
E-filing at https://incometaxindiaefiling.gov.in/ and log in using your valid
credentials.
●
Step 2- Select "E-file" from
the top menu and then click on Income Tax Forms.
●
Step 3- Once the taxpayer’s PAN
information is filled, select “Form 15CA” from the drop-down menu titled “Form
Name”
●
Step 4- Select your appropriate section
by clicking on “Select relevant part from the down”
●
Step 5- Fill out the selected fields on
Form 15CA and click "Submit".
● Step 6-
Complete the verification section in the corresponding part of Form 15CA.
It is recommended that
you fill Part C of Form 15CA before uploading Form 15CB, since the
acknowledgement number of Form 15CB is required while filing Part C.
As soon
as the form is successfully filled out, you will see a notification
"successfully submitted" including a confirmation message on the
registered email.
CA can follow the below-mentioned steps
to fill out Form 15CB
1.
Click on the Downloads tab at https://www.incometax.gov.in/iec/foportal.
2.
Choose the appropriate forms, (other
than ITR) and then convert them in JSON Utility (whichever is most
appropriate).
3.
Using your preferred utility, create the
XML file.
4.
When you are logged into the e-filing
portal, click the e-File tab and choose Upload Form from the drop-down menu.
5.
Input the PAN/TAN details of the
assessee and the CA PAN, and then select Form Named Filing Type as the
original. Press 'submit'.
Above
was an overview of filing of form
15CA and 15CB and every person
should keep in mind the above, while making remittance of money outside India.
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