What is Form 15ca and 15cb? Applicability, Procedure, Rules

What is Form 15ca and 15cb? Applicability, Procedure, Rules

Form 15CA and Form 15CB are two important documents that are required to be filed by certain individuals when making certain types of payments to foreign entities. 

In this blog, we will look at what form 15ca and 15cb are, when they are required to be filed, and what the purpose of each form is. 

We will also provide a step-by-step guide on how to file Form 15CA and Form 15CB, as well as what documents you will need to attach to each form.

What is form 15ca and 15cb?

Form 15CA and Form 15CB are two important forms required to be filed by individuals who make certain types of payments to non-residents. 

These forms are used to report the details of the payments made and are required to be submitted to the Reserve Bank of India (RBI).

Form 15CA is used for reporting payments that are liable for withholding tax, while Form 15CB is used for reporting all other payments. 

Both forms must be filed online through the RBI website, and the relevant form must be downloaded before completion.

It is important to note that both forms must be filed even if no tax is withheld on the payment being made. 

This is because the RBI uses these forms to track all payments made to non-residents so that they can ensure that appropriate taxes are being paid.

Failure to file either form may result in penalties from the RBI, so it is important to ensure that both forms are filed correctly and on time.

When is Form 15CA and 15CB required to be filed?

Form 15CA is required to be filed whenever a person resident in India receives or is deemed to receive, any income from sources outside India which is chargeable to tax. 

This includes income from employment, dividends, interest, rent, royalties, etc.

Form 15CB must be filed when the taxpayer's total value of foreign income received, or receivable exceeds Rs. 5 lakh in a financial year. 

This form must be obtained from an authorized dealer before paying a non-resident.

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

The purpose of Form 15CA is to report certain cross-border transactions so that the Indian government can determine if any taxes are owed on the income. 

Form 15CB is used to certify that the taxes have been paid on the foreign income received by the taxpayer. 

These forms must be filed with the Indian tax authorities to ensure that the correct amount of taxes is paid on foreign income.

Who can file Form 15CA and 15CB?

Form 15CA can be filed by any person resident in India who receives income from sources outside India which is chargeable to tax. 

Form 15CB is required to be filed when the total value of foreign income received or receivable by the taxpayer exceeds Rs. 5 lakh in a financial year.

To file Form 15CA, the taxpayer must have a PAN (permanent account number) and should be registered with the e-filing portal of the Income Tax Department. 

The form can be filed online as well as offline. To file offline, the taxpayer must download the Income Tax website form, fill it out, and then submit it to their jurisdictional Assessing Officer along with any supporting documentation.

To file Form 15CB, the taxpayer must again have a PAN and should also be registered on the e-filing portal of the Income Tax Department. 

The form can once again be filed online or offline. However, unlike Form 15CA, offline submission of Form 15CB is impossible unless it is in respect of foreign income received in relation to an approved project under section 80CCF of the Income Tax Act, 1961. 

In such a case, a certified copy of approval granted by a competent authority has to be enclosed along with Form 15CB.

What documents are required to be attached along with Form 15CA and Form 15CB?

When filing Form 15CA and 15CB, the following documents must be attached: 

  1. PAN of the taxpayer
  2. TDS certificate, if applicable
  3. Bank statement or passbook showing details of foreign income received
  4. Copy of Form 26AS
  5. Any other supporting document

What are the common mistakes made while filing Form 15CA and Form 15CB?

One of the most common mistakes made while filing Form 15CA is forgetting to include all the required information. 

The form requires both personal and financial information, and any missing information can cause delays in processing or even rejection of the form.

Another common mistake made while filing Form 15CA is providing inaccurate information. 

This can happen if the taxpayer does not have complete or accurate records of their income and expenses. 

What precautions should be taken while filing Form 15CA and Form 15CB?

When it comes to filing Form 15CA and Form 15CB, there are a few things you need to keep in mind. Here are some key precautions to take: 

  1. Ensure you have all the required information before starting the process. This includes things like the PAN number of the recipient, their bank account details, etc.
  2. be careful when entering the amounts in Form 15CA and Form 15CB. Make sure you enter the correct figures to avoid any mistakes.
  3. Take your time when filling out the forms. If you rush, you may make mistakes that could cost you money.
  4. Keep track of all the documents you submit as part of the process. This will come in handy if there are any issues later on.
  5. Keep a copy of everything for your records. This includes copies of the forms, supporting documents, etc.

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Conclusion

In conclusion, we provided all the information regarding what form 15ca and 15cb are; it is important to fill out these forms and to be mindful of all the requirements and details when filling out Form 15CA and Form 15CB. 

Carefully entering the correct information and amounts is crucial to avoid any mistakes. 

It is also beneficial to keep track of all submitted documents as well as copies of everything for one's own records.

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FAQs

What is the purpose of the 15CA and 15CB certificates?

The 15CA and 15CB certificates aim to ensure that taxes are paid on the remittances made to overseas entities.

What is the difference between the 15CA and 15CB certificates?

15CB certificate must be obtained from a chartered accountant for remittances made to overseas entities. 15CA certificate is no longer required to be obtained from a chartered accountant.

What is form 15ca and 15cb?

15CA is a certificate issued by a chartered accountant in practice in India who the payer has authorized to the effect that the particulars furnished by the payer along with the remittance represent neither wholly nor partly income or profits or gains chargeable to tax in India.

15CB is a certificate issued by a chartered accountant in practice in India, to the effect that having regard to the information furnished and the provisions of the Income-tax Act, 1961, as amended up to date, and the rules and orders framed there under, the amount of income, profits or gains chargeable to tax in India, if any, in respect of the remittance sought to be made, does not exceed the maximum amount which is not chargeable to tax.

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