Form 15CA & 15CB For NRIs, OCIs, and Foreign Nationals

For the Residents of India, sending money abroad to a Non-Resident Indian can be a complex process. It often requires individuals to fill out the Form 15CA and Form 15CB in different scenarios. Banks require these forms before they transfer the funds. Form 15CA is a self-declaration form, and Form 15CB is a certificate issued by a CA. There are many other sections, like 195 and Rule 37BB come into consideration before filling these forms. Understanding this entire procedure can be a huge task for a common man, as it includes many legal compliances.

In this guide, we have explained the scenarios in which these forms are needed and when they are not. We have also mentioned the usage of both these forms, which part of Form 15CA you should pick, and the steps to file these forms with the bank. You will also get the checklist of all the documents you will require. Stay till the end and learn from the real examples of remittance. 

What are Form 15CA & 15CB?

When an Indian citizen needs tos send money outside the country to a non-resident, they need to provide the basic details regarding the payment to the Income Tax Department before the bank makes the payment. They have to fill out Form 15CA, which is a self-declaration form, and Form 15CB, which is a CA's certificate. 

• Form 15CA: This form is filled out on the official Income Tax portal, and it needs to be completed before you make the payment. You should keep its acknowledgement to submit to the bank. It can be filed directly from the portal, or you can also use the offline utility by generating a JSON.
• Form 15CB: It is prepared, verified, and certified by a Chartered Accountant. It confirms all the tax-related facts involved in the payments, such as whether tax applies or not, what rate you apply, and which section or DTAA covers it. The CA also checks your invoices/contracts and any DTAA documents involved (TRC, Form 10F). 

Both of these Forms arise from the compliance needs under Section 195 (TDS on payments made to non-residents) and Rule 37BB (which contains the exemption list and who must furnish information). 

Difference Between 15CA Form and 15CB Certificate

In India, when a person or a company needs to send money outside to a foreign country, there are some tax compliances they need to follow. During this process, two common forms are used, which are Form 15CA and Form 15CB. Both the forms may look similar, but their purpose are different.

Here is a comparison table for both forms to understand them properly:

Required Documents

Here is the list of all the required documents:

Tax & Identity

• Valid Passport/Visa (if available)
• PAN 

Transaction Set

• Contract/Invoice or the Property papers
• Source for money proof (sales deed, bank statements, TDS challans, rent agreement)

Tax Set

• AO Certificate (197/195(2)/(3)) if ava9ilable
• DTAA set: Form 10F, TRC, and any no-PE statement
• TDS challans and workings

Bank Set

• Signed A2 Form
• Purpose Code (as per your bank's sheet/ RBI's list)
• Bank's extra Forms (if required)

Who Should File Form 15CA/15CB and When?

The person who is making the payment (payer) from India needs to fill out the Form 15CA. If, in your case, Form 15CB is required, you need to ask a CA to prepare it. You have to fill out Form 15CA and mention the details of 15CB in it. 

Form 15CA Parts 

1. Part A: It is used if the payment is chargeable to tax and if the total amount paid to the payee in the financial year is Rs 5 lakhs or less.
2. Part B: If your total amount exceeds Rs 5 lakhs and you have an AO certificate/order under section 195(2)/(3)/197 (less/no deduction).
3. Part C: It is used in case the aggregate is more than Rs 5 lakhs, and you have a Form 15CB from a practicing CA.
4. Part D: It is used if the payment is not chargeable to tax under the Income Tax Act. 

Application of 15CB 

If the remittance amount is more than Rs 5lakhs in the financial year, and the payment is taxable, then you have to fill out the Form 15CB (in case you don't have an AO certificate). On the Income Tax Portal, Form 15CB is mentioned as an event-based form for Form 15CA that triggers when the line of Rs 5 lakhs is crossed. 

When is Form 15CA/15CB not Required?

There is a specified list of all the payment types in Rule 37BB, in which the Form 15CA/CB is not required. In some cases, the banks mention that "For this purpose code, no forms needed", which refers to this list. If the purpose of your payment matches an item listed in that Rule, then you can avoid filling out the forms. You should always keep the proof of your purpose code and all the documents you have provided to the bank. 

It is mentioned on the portal of the Income Tax department that Form 15CA is not required in scenarios when a resident's remittance does not require the approval of the RBI, and it matches the relevant RBI purpose codes. In some cases, where the purpose is in the exempted list, but the banks still ask for the Form 15CA/15CB because they have audit checks and internal controls. 

Different Requirements For These Forms

There are scenarios in which you only have to submit Form 15CA, and in some cases, you need to fill out both Forms 15CA and 15CB. Here's how you can decide:

When only Form 15CA is required

Situation where only Form 15CA is required: 

• The amount of remittance is small.
• If the purpose for which you are sending money does not need any tax review
• If the payment is mentioned in the list of exemptions

In such cases:

• You need to fill out Form 15CA online on the Income Tax Portal.
• Download the PDF from the website.
• Submit it to the bank to process the transfer further. 

When both Form 15CA and 15CB are required

Situations in which both are required:

• The amount of remittance is large
• The purpose of the payment comes under taxation as per the Income Tax rules
• The bank asks you to submit a CA certificate before proceeding with the transfer. 

In these cases: 

• The nature of the payment is checked by a chartered accountant.
• The Form 15CB is issued by the CA in the form of a certificate.
• Then you need to fill in Form 15CA by using the details mentioned in Form 15CB.
• Download both of the Forms and submit them to your bank.

Easy way to Remember

Steps For Filling Form 15CA and Form 15CB

The entire process for filling Form 15CA and Form 15CB is explained in four steps: 

Step 1: Make your decision

Ask yourself these questions and then select the right form and part for you. 

1. Is the payment taxable in India?

• No: If it is mentioned in the specified list of Rule 37BB, then no form is required. If it's not chargeable and not mentioned on the list, then use 15CA Part D.
• Yes: Proceed to 2.

2. What is your aggregate for the financial year?

• <,= Rs 5 lakhs: 15CA, Part A.
• > Rs 5lakhs: Proceed to 3.

3. Do you have an AO certificate (197/195(2)/(3))? 

• Yes: 15CA, Part B.
• No: 15CB + 15CA, Part C.

Step 2: Get 15CB Certificate (if needed) 

Share the documents mentioned below with your CA:

• Invoice/contract and nature of income/services
• Tax Analysis (ITA + DTAA)
• TRC, Form 10F, and any no-PE note (if applicable)
• TDS challans or proof, AO letter (if any)
• Purpose code and Bank requirements

Step 3: File 15CA Form

• Log in to the official portal of Income Tax e-filing. Then go to e-file and Income tax Forms. Select Form 15CA.
• Fill out all the details, mention 15 CB (if applicable), e-verify the form, and download its acknowledgement. 
• You can also submit these forms by using the offline utility by uploading the JSON. 

Step 4: Submit it to the bank

• Provide the acknowledgment number of Form 15CA, 15CB PDF, KYC, A2 form, purpose code, and supporting papers, such as invoices, sale deed, and source statements, to the bank. 
• Follow all the instructions given by your bank for signatures or printouts.

Purpose Codes and Requirements of Banks

Every remittance that you make should be mentioned with its RBI purpose code. It is a type of label that shows the reason for the remittance. It can be for education, health, investments, consulting, gifts, family support, or anything else. The banks have pages and public PDFs that contain all these codes and samples. You need to pick out the correct one that matches the actual reason for your remittance. If you use the wrong purpose code, then it can trigger some extra forms your remittance can be delayed. 

Bank Requirements:

• A2, an application for outward remittance
• Form 15CA/15CB 
• KYC
• Proof of purpose
• Any extra forms or declarations as your bank requests

Popular NRI/OCI Remittance Scenarios

Here are the different scenarios for sending money abroad:

1. Transferring Money from NRO to NRE or overseas

1. Check the taxability: If you are repatriating the interest, rental income, or capital gains from an NRO account out of India, then it is usually taxable. 

2. Check the aggregate for the financial year: If the aggregate amount of total outward transfers in a financial year exceeds Rs 5 lakh (with no AO certificate), then you have to fill Form 15CB and Form 15CA Part C. 

3. Prepare the documents:

• Form A2
• Form 15CA acknowledgement number and Form 15CB (if required)
• KYC (PAN, visa/passport)
• Purpose code
• Proofs of sources (bank statements, property papers, TDS challans). 

The banks put focus on the purpose codes because they are required to be reported to the RBI correctly. Hence, the purpose codes and the A2 form are non-negotiable. 

2. Repatriating the sale proceeds of a property in India

• If you are an NRI seller, then the indian buyer has to fulfill the TDS duties under Section 195 of ITA. You have to apply for a lower/nil TDS certificate under section 197 (2)/(3) so that you can avoid the heavy TDS on the gross total amount.
• After the sale of property and TDS, when you send money abroad, there will be certain requirements for the bank, such as A2, purpose code, TDS proofs, and the trail of 15CA/CB. 
• If the 197 certificate is available, then you need to fill out Form 15CA Part B. If you don't have a 197 certificate and your aggregate for the financial year is more than Rs 5 lakhs and your payment is taxable, then you have to fill Form 15CB and Form 15CA Part C. 

3. Repatriating interest, rent, dividends, and capital gains

• Interest and rent that comes from the indian sources are generally taxable in India. There can be a different treatment for the dividends depending on the law at the time (mostly taxable).
• The taxation on capital gains depends on the holding period and its indexation. The final remitted amount can be changed depending on the buyer's TDS or your AO certificate.
• After you have decided on the taxability, pick the right part of Form 15 CA.

4. Business payments made to the Foreign Companies

• For those Indian businesses that are paying to a foreign vendor, check the IT Section 195 and DTAA article (business profits/PE, FTS/royalty).
• If the amount is taxable and more than Rs 5 lakhs in the financial year with no AO certificate, then you need to get a 15CB certificate and fill form 15CA Part C. Also, keep your invoices and contracts ready for your bank and CA. 

5. Medical/Education Expenses, gifts, and family maintenance

• These cases are most of the time clean LRS cases, and they have clear purpose codes. Most of the banks don't ask for Form 15CB for these types of non-taxable personal payments. Although they can ask you for 15CA Part D and some additional proofs, depending on the control policy of the banks. You should check your bank's remittance scheme and documentation. 

Penalties, Mistakes, and How to Rectify? 

Penalty Risk: If you fail to apply for the Form 15CA/15CB or you provide the wrong, incomplete information in these forms, then there will be a maximum penalty of Rs 1lakh under Section 271-I. If you tell a proper reason or show a reasonable cause, then you can also avail a relief on this penalty under section 273B. Always check the purpose code and Part of the Form from the official website, and then proceed with the form; don't just guess it.

Common mistakes you can avoid:

• You used Part A of Form 15CA in case your aggregate is greater than Rs 5 lakhs.
• You filed Part D for a type of payment that is taxable.
• You skipped the Form 15CB for the amount of remittance more than Rs 5 lakhs in the absence of an AO certificate. 
• You mentioned the wrong purpose code. This can be the reason why banks reject the payment.
• You filled the form after remittance. You need to fill before sending the money.
• There is a mismatch between the two forms regarding amounts, narrative, and currency.

What to do if you made an error:

• Withdraw your submitted Form 15CA within 7 days on the Income Tax Portal and re-file it.
• You need to ask your CA to re-issue the Form 15CB or withdraw it, if needed.
• Share the rectified Form and certificate with your designated bank.

How Can Visament Help?

If the whole process seems confusing and time-consuming to you, then it is not necessary that you have to do it all alone. You can seek guidance from the experts in this field. They can help you in the right ways and save you from legal compliance issues. At Visament, we have a team of professionals who can handle this process on a daily basis and help individuals send money abroad. They can choose the correct form and save you from compliance issues. 

Our experts handle each case very carefully and take the actions accordingly. They check whether the tax is applied or not, and they can also review the DTAA points. For Form 15CB, our team will also connect to a CA and get your certificate. We ensure smooth processing and easy transfer of funds. You can get the services at very affordable prices with 24/7 customer assistance. We also provide personalised services specially for the requirements of NRIs on our platform.