Paying a Non-Resident: Forms 15CA and 15CB

A bank will not send money abroad for most purposes until it has the payer’s tax declaration. Under the 1961 Rules that declaration is Form 15CA, sometimes backed by a chartered accountant’s Form 15CB. Under the 2026 Rules it is Form No. 145, backed where needed by Form No. 146. The forms are filed before the remittance, by the person paying, and the part used depends on two questions: is the payment taxable in India, and does the year’s total exceed Rs 5,00,000. This guide covers both Acts.

Which Act applies

• Remittances up to 31 March 2026 fall under section 195(6) of the 1961 Act and rule 37BB of the Income-tax Rules, 1962. The forms are 15CA and 15CB, and the penalty is under section 271-I.
• Remittances from 1 April 2026 fall under section 397(3)(d) of the Income-tax Act, 2025 and rule 220 of the Income-tax Rules, 2026. The forms are Form No. 145 and Form No. 146, and the penalty is under section 462.

	1961 Act / 1962 Rules	2025 Act / 2026 Rules
Duty to deduct	s.195(1)	s.393(2), Table Sl. No. 17
Duty to report the payment	s.195(6)	s.397(3)(d)
Rule	37BB	220
Payer’s declaration	Form 15CA, Parts A to D	Form No. 145, Parts A to D
Accountant’s certificate	Form 15CB	Form No. 146
Authorised dealer’s quarterly statement	Form 15CC	Form No. 147 (Form No. 148 for an IFSC unit)
Penalty	s.271-I, Rs 1,00,000	s.462, Rs 1,00,000

Why “chargeable” comes first

The duty to deduct tax applies only to a sum “chargeable under the provisions of this Act”. In GE India Technology Centre Pvt. Ltd. v. CIT (Supreme Court, 9 September 2010, 327 ITR 456), Indian distributors paid foreign suppliers for shrink-wrapped software. The Karnataka High Court held that tax had to be deducted from any remittance unless the payer obtained the Assessing Officer’s permission under section 195(2). The Supreme Court overruled that view. Section 195(1) “in clear terms lays down that tax at source is deductible only from ‘sums chargeable’”. Section 195(2) applies only to a composite payment where part is chargeable. The Court also noted section 195(6), then newly inserted, as one of the safeguards against loss of revenue.

The reporting duty in section 195(6) and section 397(3)(d) is wider than the deduction duty. It covers any sum “whether or not chargeable”. That is why Form 15CA and Form No. 145 have a Part D for non-taxable payments.

The four parts of Form No. 145

Rule 220(1) of the 2026 Rules covers payments “chargeable under the Act”:

• Part A applies where “the amount of payment or the aggregate of such payments … made during the tax year does not exceed Rs. 5,00,000” (rule 220(1)(a)).
• Part B applies where the aggregate exceeds Rs 5,00,000 “and where a certificate or order is obtained from the Assessing Officer under section 395(1) or (2)” (rule 220(1)(b)).
• Part C applies where the aggregate exceeds Rs 5,00,000 and a certificate in Form No. 146 has been obtained from an accountant as defined in section 515(3)(b). Where Part B has been furnished, Part C is not needed (rule 220(1)©).
• Part D applies to a payment “which is not chargeable under the provisions of the Act” (rule 220(2)).

Rule 37BB(1) and (2) of the 1962 Rules use the same structure for Form 15CA. The Part B trigger there is a certificate under section 197 or an order under section 195(2) or (3), measured over the financial year. The 2025 Act has no separate counterpart to section 195(3). A non-resident’s branch that wants to receive payments without deduction now applies for a certificate under section 395(1) in Form No. 126 (rule 209).

When nothing need be filed

Rule 220(3) dispenses with Form No. 145 for a sum not chargeable to tax in three cases:

• (a) the remittance is made by an individual and does not need the Reserve Bank’s prior approval under section 5 of FEMA read with Schedule III to the Foreign Exchange (Current Account Transaction) Rules, 2000;
• (b) the remittance is made by a Unit of an International Financial Services Centre referred to in section 147(1)(b);
• © the remittance is of a nature specified in the list in the rule, by RBI purpose code.

The list has 33 entries. They include Indian investment abroad (S0001 to S0005), advance payment against imports and import settlement (S0101, S0102), business travel and travel for education or medical treatment (S0301 to S0305), family maintenance remittances by non-residents (S1301), and personal gifts and donations (S1302). Rule 37BB(3) had the same exemptions except the IFSC clause, which is new in rule 220(3)(b).

The exemption is limited to sums that are not chargeable. A chargeable payment needs Part A, B or C even if its purpose code is on the list.

What to have ready

• The remittee’s details: name, address, country of residence and PAN if any.
• The nature and purpose of the payment, with the RBI purpose code, and the invoice or agreement.
• The aggregate already remitted to that payee in the tax year, to decide between Part A and Parts B or C.
• The tax position: the section under which the sum is chargeable, the rate under the Act, and the treaty rate if lower.
• For a treaty rate: the remittee’s tax residency certificate and Form No. 41 (Form 10F under the 1962 Rules). Section 2(90)© of the 2025 Act allows deduction under Table Sl. No. 17 at the Finance Act rate or the treaty rate, “whichever is applicable”, and section 159(8) makes the certificate and prescribed information conditions of treaty relief. See Treaty Relief: TRC, Form 10F and Foreign Tax Credit.
• Where the remittee has no PAN: the details in rule 217(2) of the 2026 Rules (rule 37BC of the 1962 Rules), namely name, e-mail, contact number, foreign address, tax residency certificate and foreign tax identification number. These avoid the higher rate under section 397(2)(b) for interest, royalty, fees for technical services, dividend and capital gains.
• Proof of tax deposited, since the deduction is paid to the Government before the form is filed. See Deducting and Depositing TDS.
• For Part B: the Assessing Officer’s certificate or order.
• For Part C: the accountant’s Form No. 146 (Form 15CB), filed first.

The accountant’s certificate

The portal’s Form 15CB FAQ describes the certificate as the “Tax Determination Certificate” in which the accountant examines the remittance against the charging provisions of sections 5 and 9 and any treaty. It records the payment, the rate of deduction, the amount deducted, and the nature and purpose of the remittance. The FAQ states that it “can only be e-Verified using DSC” of the chartered accountant, who must be registered on the portal and to whom the taxpayer has assigned the form. No time limit is prescribed, but it is filed before the remittance.

Portal steps

The portal’s Form 15CA user manual describes the online route:

1. Log in to the e-filing portal and go to e-file > Income tax forms.
2. Select Form 15CA. For Part C, first enter the acknowledgement number of the accountant’s e-verified Form 15CB. The manual notes that one 15CB acknowledgement can be used for only one Part C.
3. Fill the remitter, remittee and remittance details, and the Assessing Officer’s order details for Part B.
4. Preview, then e-verify.
5. The portal shows a transaction ID and acknowledgement number and sends a confirmation e-mail.

The form can also be filed through the offline utility. These manuals were written for the 1962 forms. At the time of writing, the portal’s help pages describe Form 15CA and 15CB and have not been rewritten for Forms No. 145 and 146.

Signing, and delivery to the bank

Rule 220(4) allows two modes. The form may be furnished electronically under digital signature and then submitted to the authorised dealer, or furnished electronically and a signed printout given to the authorised dealer. Either way, the authorised dealer must have it “prior to remitting the payment”. The 15CA FAQ says the form can be e-verified by DSC or EVC, and by DSC where one is registered. Under rule 220(5), an income-tax authority may require the authorised dealer to produce the copy.

The authorised dealer reports all remittances quarterly, in Form No. 147, within fifteen days of the end of each quarter (rule 220(6)). Under the 1962 Rules this was Form 15CC. An IFSC unit making such payments files Form No. 148.

Correcting or withdrawing a form

The portal’s 15CA FAQ states that a filed Form 15CA “can be withdrawn within 7 days from submission date”. After that, a mistake is corrected by filing a fresh form and keeping a record of why. The deduction itself, if wrong, is dealt with through the TDS statement. Payments to non-residents are reported in the quarterly statement (Form 27Q under the 1962 Rules). See Quarterly TDS and TCS Statements.

Penalty

Section 462 of the 2025 Act provides that if a person required to furnish information under section 397(3)(d) “fails to furnish such information, or furnishes inaccurate information”, the Assessing Officer may impose a penalty of Rs 1,00,000. Section 271-I of the 1961 Act is the same, at one lakh rupees. A wrong certificate exposes the accountant to a penalty of Rs 10,000 per report or certificate under section 463(1) (section 271J of the 1961 Act).

These penalties are separate from the consequences of not deducting tax. A payer who was required to deduct tax and did not is an assessee in default under section 398(1) of the 2025 Act (section 201 of the 1961 Act), liable for the tax and interest. Under the 1961 Act, section 40(a)(i) may also disallow the expense.

A wording point in section 397(3)(d)

Section 195(6) of the 1961 Act and rule 220 both describe the payee as “a non-resident, not being a company, or … a foreign company”. Section 393(2), Table Sl. No. 17, uses the same two categories. Section 397(3)(d) of the 2025 Act, as printed, reads “a non-resident, not being a company or a foreign company”, without the comma or the second “to”. Rule 220 and the Table make the intended coverage of foreign companies clear, and the forms are framed on that basis.

Summary

1. Decide whether the sum is chargeable to tax in India, under the Act and any treaty.
2. If not chargeable, check rule 220(3) for an exemption. If none applies, file Part D.
3. If chargeable and the year’s total to the payee is Rs 5,00,000 or less, deduct, deposit and file Part A.
4. If above Rs 5,00,000, obtain either the Assessing Officer’s certificate or order (Part B) or the accountant’s Form No. 146 (Part C).
5. File and verify before the remittance, and give the form to the authorised dealer.
6. Report the deduction in the quarterly statement.

The next guide, Treaty Relief: TRC, Form 10F and Foreign Tax Credit, covers the documents a non-resident needs for a treaty rate, and how a resident claims credit for tax paid abroad.