To file Form 15CA and Form 15CB for a foreign remittance, first work out whether the payment is taxable in India and whether it crosses ₹5 lakh in the financial year, then pick the correct part of Form 15CA (A, B, C, or D), obtain a Chartered Accountant’s Form 15CB if you need Part C, submit the forms on the Income Tax e-filing portal before the transfer, and give the acknowledgment to your authorized dealer bank.
Pick the Right Part of Form 15CA
Form 15CA is a self-declaration split into four parts. Which one you use depends on two questions: is the payment taxable in India, and does it cross ₹5 lakh in this financial year?
- Part A — the remittance is taxable and the total to this recipient during the year does not exceed ₹5 lakh. No CA certificate needed.
- Part B — the remittance is taxable, exceeds ₹5 lakh, and you already hold a certificate or order from the Assessing Officer under Section 197 or Section 195(2)/(3).
- Part C — the remittance is taxable, exceeds ₹5 lakh, and you are relying on a Chartered Accountant’s certificate in Form 15CB.
- Part D — the remittance is not taxable under the Income Tax Act.
Part C is the common route for business payments such as royalties, fees for technical services, or software licensing. Part D covers non-taxable outflows: no tax is withheld, but the form is still filed so the department has a record of the transfer.1Income Tax Department. Form 15CA FAQs
Watch a common trap. Part A is not the default for small remittances; it applies only when the payment is taxable. A non-taxable remittance, however small, belongs in Part D. Picking the wrong part invites scrutiny and can hold up the bank transfer.
When You Need Form 15CB From a CA
Form 15CB is mandatory for each taxable remittance above ₹5 lakh in a financial year, unless you already have an Assessing Officer’s order covering the transaction.2Income Tax Department. Form 15CB User Manual The certificate is event-based: three qualifying payments to the same non-resident in the same year need three separate Form 15CBs.
The Chartered Accountant examines chargeability under Sections 5 and 9 of the Income Tax Act and applies any relevant Double Taxation Avoidance Agreement to fix the correct rate.3Income Tax Department. Form 15CB FAQs The CA must attach a Unique Document Identification Number (UDIN); the portal allows the form to be submitted first and the UDIN updated later if it is not immediately available.2Income Tax Department. Form 15CB User Manual
You cannot file Part C of Form 15CA until Form 15CB is on the portal, because Part C asks for the 15CB acknowledgment number. Engage the CA early.
Remittances That Do Not Need the Form
Rule 37BB lists categories of remittances exempt from Form 15CA reporting, including payments for imports, personal travel, maintenance of close relatives abroad, medical treatment, and educational expenses.4Income Tax Department. Form 15CA FAQs Non-taxable remittances under the Liberalised Remittance Scheme that do not require prior RBI approval are also generally exempt.5Reserve Bank of India. Liberalised Remittance Scheme (LRS)
Confirm the specific purpose code before assuming an exemption. If the transaction does not match a listed category, you file the form regardless of size. Banks flag mismatches, and rejections cost time.
What to Gather Before You Start
Have this information ready. Every figure must line up with what your bank has on file, because the bank cross-checks the form against its own records before releasing the wire.
- Remitter details: PAN, TAN, address, contact information.
- Recipient details: full legal name, foreign address, email, and Indian PAN if the non-resident has one.
- Transaction details: nature of the remittance (royalty, fee for technical services, interest, etc.), currency, exchange rate on the actual date of transfer, and amounts in both rupees and foreign currency.
- Tax details: TDS rate applied, total tax deducted, and the relevant DTAA article if you are claiming a treaty rate.
- For Part C: the Form 15CB acknowledgment number and the CA’s UDIN.
The exchange rate needs to reflect the transfer date, not the date you sit down to fill in the form. That single mismatch is a frequent cause of bank rejections.
Filing on the E-Filing Portal
There is no statutory deadline, but the form must be filed before the remittance is made.1Income Tax Department. Form 15CA FAQs The steps:
- Log in to the Income Tax e-filing portal. Go to e-File, then Income Tax Forms, and select Form 15CA.
- Choose the correct part (A, B, C, or D) and complete the fields. For Part C, enter the Form 15CB acknowledgment number and the CA’s UDIN.
- Verify the form using a Digital Signature Certificate (DSC) or an Electronic Verification Code (EVC). If a DSC is registered on your account, you must use the DSC.1Income Tax Department. Form 15CA FAQs
- Download the acknowledgment and the signed form once the portal confirms submission.
- Hand the acknowledgment and printed form to your authorized dealer bank. The bank will not release the foreign transfer without it.
Each transaction is tracked by its acknowledgment number, which the tax department can audit later. Completing every step before you approach the bank prevents the most common cause of stuck wires.
Getting the Withholding Right
The PAN Trap Under Section 206AA
If the non-resident recipient does not furnish a valid PAN, Section 206AA requires TDS at the highest of three rates: the rate in the relevant provision of the Act, the rate in the current Finance Act, or a flat 20%. In practice that means 20%, because most cross-border rates under the Act or a treaty are lower. Section 206AA(7) offers narrow relief for certain non-residents who provide the prescribed alternative documentation. The cleanest fix is to have the recipient obtain a PAN before the payment.
Cess and Surcharge on Top of the Base Rate
The base TDS rate is not the final number withheld. A Health and Education Cess of 4% applies on the tax plus any surcharge. Surcharge on a foreign company kicks in once taxable income crosses ₹1 crore, with marginal relief so it never exceeds the incremental income above the threshold.6Income Tax Department. Foreign Company for AY 2026-27 Compute the effective rate after cess and surcharge before entering it on the form; a wrong effective rate is one of the more common triggers for Assessing Officer queries.
Claiming a Treaty Rate
Many DTAAs prescribe a lower withholding rate than domestic law. The CA preparing Form 15CB is required to check the applicable treaty and certify the lower rate where it applies.3Income Tax Department. Form 15CB FAQs To claim the benefit, the non-resident normally has to provide a Tax Residency Certificate from their home country. Without a TRC in hand, the CA cannot certify the treaty rate, and you end up withholding at the higher domestic rate. Collect the TRC before you engage the CA.
If the Transaction Falls Through
Form 15CA can be withdrawn within seven days of submission if the underlying payment does not go ahead.1Income Tax Department. Form 15CA FAQs The option sits in the same portal menu you used to file. After seven days, withdrawal is no longer available, and any discrepancy has to be sorted out with the Assessing Officer.
What Non-Compliance Costs
Failing to file the form, or filing inaccurate information, carries a penalty of ₹1,00,000 per default under Section 271-I.7Income Tax Department. Penalties – AY 2026-27 The penalty is for the reporting failure itself and applies whether or not the payment turned out to be taxable.
The commercial cost usually bites first. Banks refuse to process remittances without the acknowledgment, and a rejected wire has to be reinitiated after filing, which can push commercial payments back by days or weeks.
Coming Change: Form 145 and Form 146 From April 1, 2026
The Income Tax Act, 2025 takes effect on April 1, 2026, repealing the 1961 Act for tax years beginning on or after that date.8Income Tax Department. Objective and Scope of the New Act Form 15CA becomes Form 145 and Form 15CB becomes Form 146. The structure carries over: same four-part classification, same ₹5 lakh threshold, same CA certificate requirement.9Income Tax Department. Form 145 User Manual Section 393 replaces Section 195 for TDS on payments to non-residents, and Section 462 replaces Section 271-I for the penalty.10Income Tax Department. Form No 145 – Payments to Non-Residents/Foreign Company Proceedings and assessments for tax years before April 1, 2026 continue under the old Act, so the older section and form references still matter for anything relating to earlier years.