Brief Guide relating to Submission of Form 15CA and form 15CB

Whenever the taxes and returns are filed, not only the individuals have to make sure that the procedures are followed properly and the appropriate forms have been submitted, but also the department or the banking institutions from where the payments have been made are required to check everything thoroughly. When a person who is resident of India makes a money or fund transfer to a non-resident also called as remittances, it is the bank, which is required to check whether the individual has paid the liable taxes on such remittances or not.

To make a payment or remittance outside India requires a lot of compliances to be complied with. One such important or necessary compliance is to file Form 15CA and 15CB. Since it becomes nearly impossible to collect taxes on the remittances after they have been transferred or in later stages, therefore, the same must be verified by the financial or banking institutions at the time of making the remittances.

Related Articles- Form 15CA and 15CB: Complete Details

All the banks and financial institutions are required to follow certain rules and regulations for helping the Income Tax Authority to identify and determine the chargeable taxes on the Non-Resident Indians (NRIs). All the remittances or payments made to the foreign countries have tax implications that can be missed out by the taxpayers mistakenly. Section 195 of the Income Tax Act, 1961 states that any amount is to deducted which is liable as taxes under the act. Therefore the taxpayers while making any remittances are required to file Form 15CA and 15CB to the bank from which the transfer of funds is initiated to the foreign country.

As per the Income Tax Act, 1961 there are around thirty-three types of transactions or list of payments to foreign countries for which a taxpayer is required to file Form 15CA and 15CB.

 

Form 15CA and 15CB: Definition

Form 15CA: This form is type of a declaration for the remitter. It acts as a tool for gathering all the information related to payments that are taxable in the hands of the non-resident recipient and which require filing of the Form 15CA and 15CB during the transfer of funds. It is really beneficial for the taxation department as well to track and collect the taxes and information regarding any missed taxes by the remitter or the recipient.

Form 15CB: This form is a type of certificate to be signed by the Chartered Accountant, certifying that the taxpayer has paid the right taxes and the rates of taxes are accurate. While filing Form 15CA, certain details from the Form 15CB are required. Also, it must be checked during filing, does Form 15CB is required for payment for purchases for accurate filing.

 

Thus the taxpayer must file the required Form 15CA and 15CB with the banks while making the remittances. The Form 15CA is required to be filed online in the tax department’s online portal. Also, it is advisable to the remitters to obtain a certificate in Form 15CB in cases where Form 15CA is not required or applicable as taxability of non-residents is a very complex and complicated matter.