Navigating the world of international payments can feel overwhelming, especially when you’re juggling Indian tax regulations. If your business needs to send money abroad, understanding Forms 15CA and 15CB is more than just ticking a box—it’s about protecting your company from hefty penalties (up to ₹1 lakh per slip-up).

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Why Should You Care About Forms 15CA & 15CB?

Imagine this: you’re ready to pay a foreign vendor for services, but your bank requests Forms 15CA and possibly 15CB. If you don’t have them, your payment gets stuck—or worse, you face a penalty of ₹1 lakh per mistake, plus interest and potential expense disallowances. These forms are essential for any Indian business making payments to non-residents or foreign companies, helping the tax department track cross-border transactions and ensure the right taxes are deducted.

Breaking Down the Forms

What is Form 15CA?

Form 15CA is your declaration to the tax authorities that you’re about to send money abroad. It’s a way for the government to keep tabs on foreign payments and check if taxes need to be deducted.

Key Points:

• Who files it: The person or business making the payment (the remitter)
• When: Before the payment is processed
• Where: Submitted to your bank along with your remittance request
• Verification: Can be done using a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC)

What is Form 15CB?

Form 15CB is a professional certificate from a Chartered Accountant (CA). This certificate is required for larger payments (over ₹5 lakh in a year) that are taxable in India. The CA checks that the payment complies with Indian tax laws and any relevant Double Taxation Avoidance Agreements (DTAA).

Key Points:

• Who prepares it: Only a registered Chartered Accountant
• When required: For taxable payments over ₹5 lakh in a financial year
• Verification: Must be digitally signed by the CA
• Validity: For a single transaction only

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The Four Parts of Form 15CA: Which One Do You Need?

Form 15CA is split into four parts, depending on how much you’re paying and whether the payment is taxable:

Part	When to Use	Key Details
A	Small taxable payments (≤ ₹5 lakh)	Direct bank submission; DSC/EVC okay
B	Large payments with AO certificate (> ₹5 lakh)	No Form 15CB needed
C	Large taxable payments (> ₹5 lakh)	Form 15CB required first
D	Non-taxable payments (any amount)	Simplified process

When Are These Forms Required?

Form 15CAYou’ll need Form 15CA for most payments to non-residents, including:Royalties to foreign companiesTechnical service fees for overseas consultantsInterest payments on foreign loansInvestment income to NRIsProfessional fees to foreign entities

Form 15CBYou’ll need Form 15CB if:The payment exceeds ₹5 lakh in a financial yearThe payment is taxable in IndiaYou don’t have an AO certificate under Section 195/197.You’re claiming DTAA benefits

Exemptions: When You Don’t Need These Forms

Under Rule 37BB, some payments are exempt from Forms 15CA and 15CB. These include:

• Import payments for goods and services
• Advance payments against imports
• Freight and insurance for imports/exports
• Travel expenses (under Basic Travel Quota)
• Medical treatment and education fees abroad
• Family maintenance for NRIs
• Investments abroad in equity, debt, or real estate
• Loans to non-residents

TDS and Section 195: What You Need to Know

Section 195 requires you to deduct tax (TDS) on payments to non-residents and Foreign company. The standard rate is 20%, but this can be lower under a DTAA.

No threshold: Unlike domestic TDS, there’s no minimum amount—if the payment is taxable, you must deduct tax.

Decision Flowchart: Which Form Do You Need?

Here’s a quick way to decide:

1. Is the payment to a non-resident/foreign company under Section 195?
   1. Yes: Go to next step
   1. No: No forms needed
2. Is the payment exempt under Rule 37BB?
   1. Yes: No forms needed
   1. No: Go to next step
3. Is the total payment ≤ ₹5 lakh in the financial year?
   1. Yes: File Form 15CA Part A (taxable) or Part D (non-taxable)
   1. No: Go to next step
4. Do you have an AO certificate under Section 195/197?
   1. Yes: File Form 15CA Part B
   1. No: Go to next step
5. Is the payment taxable?
   1. Yes: File Form 15CB + Form 15CA Part C
   1. No: File Form 15CA Part D

How to File: Step-by-Step

For Payments ≤ ₹5 Lakh

1. Check if the payment is taxable
2. Gather your documents
3. File Form 15CA (Part A if taxable, Part D if not)
4. E-verify using DSC or EVC
5. Submit to your bank

For Payments > ₹5 Lakh (Requiring Form 15CB)

1. Assign a CA through the e-filing portal
2. CA prepares and files Form 15CB
3. CA digitally signs the form
4. Get the Form 15CB acknowledgment number
5. File Form 15CA Part C using this number
6. E-verify Form 15CA
7. Submit both forms to your bank

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Timelines:

• Withdrawal: Forms can be withdrawn within 7 days of filing
• Deadline: File before you process the remittance
• CA assignment: Do this at the start of each financial year

Penalties: What Happens If You Get It Wrong?

• Penalty: Up to ₹1 lakh per mistake (Section 271I)
• Interest: For late TDS deposit
• Expense disallowance: If TDS isn’t deducted properly
• Bank rejection: Your payment won’t go through without the right forms

Document Checklist

For all remittances:Valid invoice or service agreementBank account detailsPayee’s name and addressPurpose of paymentCurrency conversion calculations	For Form 15CB:Tax Residency Certificate (TRC)Form 10F (if claiming DTAA benefits)Payee’s PAN or equivalentNo Permanent Establishment certificate (for services)DTAA treaty copyPrevious year’s tax returns (if needed)
For bank submission:Completed Form 15CAForm 15CB (if required)SWIFT remittance applicationImport/export documents (if needed)RBI approval (for specific categories)

Conclusion: Make Compliance Work for You

Getting Forms 15CA and 15CB right isn’t just about avoiding penalties—it’s about building a smooth, efficient process for your international payments. Companies that invest in good compliance practices enjoy faster payments, better banking relationships, and fewer headaches.

Treat compliance as a strategic advantage, not a burden. With the right processes, documents, and expert support, you can handle foreign remittances with confidence and focus on growing your business globally.

Remember: The cost of professional help is small compared to the risk of penalties and payment delays. Get it right from the start, and your international operations will run smoothly.

Don’t leave your compliance to chance. Get expert assistance through our 15CA & 15CB Certification Services and ensure your remittance process is hassle-free.