During business, it happens that many payments are made outside India. When payments are made outside India, there is certain compliance that one needs to follow and tax is required to be deducted for any sum which is taxable under the Income Tax Act. The purpose of this compliance is to collect information in respect of the payments that are chargeable to tax in the hands of recipient NRI. The main requirement is to file Form 15CA for any payment made outside India to an NRI. Form 15 CA needs to be filed online on official website of Income Tax department.

What is Form 15CA?

• Form 15CA is a declaration made by the person remitting the money wherein he states that he has deducted the tax from any payments so made to the non-resident.
• It needs to be filed by the remitter- a person making the payment to an NRI or a Foreign Company.
• Form 15 CA is also used as a tool to gather information regarding the payments that are chargeable to tax.
• Through this form, the Income Tax Department also keeps a track of all the foreign remittances/payments and their taxability.
• As per Income Tax Rule 37BB, it is the responsibility and the duty of authorized banks or dealers to ensure that they obtain such forms from a remitter.
• Income Tax Form 15 CA is required to be filed online with the Income Tax Department.
• Also, along with Form 15 CA, 15 CB needs to be filed with the Income-tax Department.
• However, Form 15 CB needs to be accompanied by a certificate from an Accountant in Form 15CB.

Information and Parts of Form 15 CA

The furnishing of information for payment to a non-resident, not being a company, or to a foreign company in Form 15CA has been classified into 4 parts.

As the Income Tax Department has now created an online facility to file information in Form 15 CA, It is required to be filed online with the tax department. After that, proof of online submission should be printed out. This copy is required to be given to the Bank as proof of tax clearance from the tax department.

Consequences of Non-filing of Form 15 CA

• If an assessee who is required to file Form 15CA fails to furnish the same before making remittance to a non-resident, then he shall be liable to pay a penalty as per the provisions of the Income Tax Act, 1961.
• Such penal provision shall be attracted even if the person furnishes inaccurate information.

The amount of penalty which the assessing officer may ask the assessee to pay for Non-compliance may reach up to is Rs.1 lakhs.

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