Sandeep Ahuja & Co.

Established in the year 1986, we are a leading chartered accountancy firm based in Delhi & NCR rendering comprehensive professional services which include statutory audit, internal audit, direct tax, transfer pricing, GST, bank audit, propriety audit, cost accounting, internal financial controls and risk advisory.

Friday, February 21, 2014

Payment to Non Resident - substitution of Rule 37BB & Form No. 15CA & 15CB

INCOME-TAX (FOURTEENTH AMENDMENT) RULES, 2013 
SUBSTITUTION OF RULE 37BB AND FORM NOS. 15CA AND 15CB
NOTIFICATION NO. 67/2013 DATED 2-9-2013
Payment to Non Resident - Substitution of Rule 37BB & Form No. 15CA & 15CB
In supersession of the notification of the Government of India in the Ministry of Finance, , issued by the CBDT vide number S.O.2363(E) dated the 5th August, 2013, the CBDT hereby issues Notification No.67 dated 02.09.2013 and makes the following rules further to amend the Income-tax Rules, 1962, namely:—
1. (1) These rules may be called the Income-tax (14th Amendment) Rules, 2013.
    (2) They shall come into force on the 1st day of October, 2013.
2. In the Income-tax Rules, 1962 for rule 37BB, the following rule shall be substituted, namely:    —"37BB. Furnishing of information by the person responsible for making any payment including any interest or salary or any other sum chargeable to tax, to a non-resident, not being a company, or to a foreign company
(1) Any person responsible for paying to a non-resident, not being a company, or to a foreign company, any interest or salary or any other sum chargeable to tax under the provisions of the Act, shall furnish the following, namely:—
(i)

the information in Part A of Form No.15CA,
a)      if the amount of payment does not exceed Rs.50000/- (fifty thousand rupees) and
b)      the aggregate of such payments made during the financial year does not exceed Rs.250000/- (two lac fifty thousand rupees);
(ii)

the information in Part B of Form No.15CA for payments other than the payments referred in clause (i) after obtaining—

(a)

a certificate in Form No. 15CB from an accountant as defined in the Explanation below sub-section (2) of section 288; or
(b)

a certificate from the Assessing Officer under section 197; or
(c)

an order from the Assessing Officer under sub-section (2) or sub-section (3) of section 195.
(2) The information in Form No. 15CA shall be furnished by the person electronically to the website designated by the Income-tax Department and thereafter signed printout of the said form shall be submitted to the authorised dealer, prior to remitting the payment.
(3) An income-tax authority may require the authorised dealer to furnish the signed printout referred to in sub-rule (2) for the purposes of any proceedings under the Act.
Explanation 1 Specified list as per earlier notification dated August 5, 2013 is amended  to exclude following items of payment it is hereby clarified that for payments of the nature specified here below excluded from the specified list information is required to be furnished :
1.      Payment for life insurance premium;
2.      Other general insurance premium;
3.     Payments on account of stevedoring, demurrage, port handling charges etc;
4.      Freight on imports - Airline companies;
5.      Booking of passages abroad – Shipping companies;
6.      Freight on exports - Shipping companies;
7.      Freight on imports - Shipping companies;
8.      Payment for surplus freight or passenger fare by foreign shipping companies operating in India;
9.      Imports by diplomatic missions;
10.  Payment towards imports-settlement of invoice; and
11.  Advance payment against imports.
Explanation II-  It is hereby clarified that for payments of the nature specified in column (3) of the specified list below, no information is required to be furnished under sub-rule (1).
SPECIFIED LIST
Sl.No.
Purpose code as per RBI
Nature of payment
(1)
(2)
(3)
1
S0001
Indian investment abroad -in equity capital (shares)
2
S0002
Indian investment abroad -in debt securities
3
S0003
Indian investment abroad -in branches and wholly owned subsidiaries
4
S0004
Indian investment abroad -in subsidiaries and associates
5
S0005
Indian investment abroad -in real estate
6
S0011
Loans extended to Non-Residents
7
S0202
Payment- for operating expenses of Indian shipping companies operating abroad.
8
S0208
Operating expenses of Indian Airlines companies operating abroad
9
S0212
Booking of passages abroad -Airlines companies
10
S0301
Remittance towards business travel.
11
S0302
Travel under basic travel quota (BTQ)
12
S0303
Travel for pilgrimage
13
S0304
Travel for medical treatment
14
S0305
Travel for education (including fees, hostel expenses etc.)
15
S0401
Postal services
16
S0501
Construction of projects abroad by Indian companies including import of goods at project site
17
S0602
Freight insurance - relating to import and export of goods
18
S1011
Payments for maintenance of offices abroad
19
S1201
Maintenance of Indian embassies abroad
20
S1 202
Remittances by foreign embassies in India
21
S1301
Remittance by non-residents towards family maintenance and-savings
22
S1302
Remittance towards personal gifts and donations
23
S1303
Remittance towards donations to religious and charitable institutions abroad
24
S1304
Remittance towards grants and donations to other Governments and charitable institutions established by the Governments.
25
S1305
Contributions or donations by the Government to international institutions
26
S1306
Remittance towards payment or refund of taxes.
27
S1501
Refunds or rebates or reduction in invoice value on account of exports
28
S1503
Payments by residents for international bidding".


Wednesday, February 12, 2014

FIVE STEPS TO FURNISH 15 CA and 15 CB

FIVE STEPS TO FURNISH 15 CA and 15 CB
No remittance should be made to a non resident without furnishing an undertaking in Form 15CA along with a certificate from an accountant in Form 15CB except in cases of certain personal remittances (which have been specifically exempted).If any payment including any interest or salary or any other sum chargeable to tax, is made to non-resident, not being a company, or to a foreign company then Form 15CA and Form 15CB are applicable. 
Form 15CA has two Parts :
Part A - Applicable if the remittance to non-resident or to a foreign company does not exceed Rs.50,000 per transaction and aggregate payment made during the financial year does not exceed Rs. 2,50,000.
Part B – Applicable if the remittance is chargeable to tax and exceed Rs. 50000 per transaction and aggregate of such payments made during the financial year exceeds Rs.2,50,000.
Information required for furnishing of the form 15CA and 15CB
Part A - Form 15 CA requires :
§  Particulars of Remitter, Remittee, Remittance made and TDS
§  Mandatory to furnish PAN of Remitter, if tax is deducted then TAN of the Remitter also needs to be provided. If remittance is chargeable to tax and PAN of remittee is not available Section 206AA is mandatorily applicable.
§  E-mail and Phone Number of remittee to be furnished, if available.
Part B - Form 15 CA requires :
§  Taxability under the Income Tax Act
§  Taxability under the relevant DTAA. Details of TRC (Tax Residency Certificate)
Steps of furnishing the Form 15CA:
Step 1: Remitter shall obtain Form 15CB from a chartered accountant a certificate.
 Step 2login to site incometaxindiaefiling.gov.in/ – Login ID is same, which has been used for filling e-return. Remitter shall electronically upload Form 15CA on the website – With effect from February 12, 2014, the foreign remittance details in Form 15CA on the e-filing portal at  www.incometaxindiaefiling.gov.in.

Step 3: The form 15CA shall be filled on the basis of the information contained in form 15CB. Form 15CB is not required in case of filling Part A of the form 15CB. Either of the below are to be obtained for filling up Part B of Form 15CA:
§  a certificate in form no. 15cb from a chartered accountant or
§  a certificate from the Assessing Officer (AO) under Sec 197 or
§  an order from Assessing Officer under sub-sec (2) or sub-section (3) of sec 195
Step 4: 15CA form available under e-filling menu as “prepare & submit the others forms (other than return)”

Step 5:  Digital Signature is required to generate the 15CA forms and take printout and affix company stamp and submit it to Authorized dealer i.e.Banker Then the RBI/ Authorized dealer remits the amount and forwards to the assessing officer a copy of form 15 CA and form 15CB. 

Contributed by Shiwali Shukla and Tanya Gagneja

Tuesday, February 11, 2014

Revised Form 15CA & 15CB w.e.f. 1st October 2013

Amendment in Rule  37BB  prescribing new Forms 15CA & 15CB
Remittances not chargeable to tax –Not to be reported under Form 15CA
Remittances covered in Specified List are not required to be reported in Form 15CA & 15CB.
New forms 15CA & 15CB have been prescribed in suppression of the earlier Forms.
Forms provide for two categories - Part A and Part B of 15CA on which remittances are to be reported
Only taxable remittances (including salary or interest) are required to be reported in Form 15CA
Form 15CA (Part A)-Report only those Remittances which were earlier reported
Form 15CA (Part B)- Only Taxable remittances are to be reported
List of Remittances removed from Specified List and such payments are now required to be reported in Form 15CA
  1. Payment for life insurance premium , Other general insurance premium
  2. Payments on account of stevedoring, demurrage, port handling charges etc.
  3. Freight on imports - Airlines companies, Imports by diplomatic missions
  4. Booking of passages abroad - Shipping companies, Freight on exports & Imports - Shipping companies. Payments for surplus freight or passenger fare by foreign shipping companies operating in India.
  5. Payment towards imports-settlement of invoice, Advance payment against imports

Particulars
Old Form 15CA (Upto 30th September, 2013)
New (Valid on or after 1st October, 2013)
Single Remittance < Rs. 50,000
                       AND
Aggregate Payment
during year  < Rs. 2,50,000
To be reported in Part A and Part B of Form 15CA
Not to be Reported at all
If  Remittance exceeds the threshold Limit
To be reported in Part A and Part B of Form 15CA
To be reported in Part B of Form 15CA along with Form 15CB and other prescribed documents, if any
Person Responsible to fill Form 15CA
Person responsible for making remittance to NR or foreign company
Person responsible for making remittance to NR or foreign company WHICH IS CHARGEABLE TO TAX IN INDIA (INCLUDING INTEREST OR SALARY)
                                                                                             Part A of Form 15CA
Type of remittance Form 15CA filled
For all Remittances made to NR or to a foreign company
If sum remitted to NR or to foreign company EXCEEDS the threshold limit mentioned above
Type of Information to be filled
1)Particulars of Remitter, Remittee &  Accountant
2) Principal Place of business of remitter & remittee to be specified
1) Particulars of Remitter, Remittee & Amount of remittance made & TDS deducted thereon
2) PAN of remitter, if available
3) E-mail & phone no. of remittee shall be furnished
4) Mandatory application of provisions of Section 206AA, if remittance is chargeable to tax and PAN of remittee is not available
Conditions to be satisfied
The information shall be furnished after obtaining certificate under Form 15CB
Form 15CB isn't required to be obtained to furnish information in this part

Part B of Form 15CA
Who shall have to fill it?
All remittances other than those specified in filing Form 15CA
To be filled if sum remitted to NR or foreign company, is chargeable to tax (including interest or salary) and:
(a)     exceeds Rs 50,000 per transaction
            OR
(b)     aggregate of such payments during the financial year exceeds Rs. 2,50,000
Who is not required to fill it?
All remitters filing Part A of Form 15CA have to fill Part B
Ø  If remittance is not taxable
Ø  If remittance (including interest or salary) is chargeable to tax and is covered by part A of Form 15CA; or
Ø  Remittance is covered by specified list (given in Explanation to amended Rule 37BB)
Conditions to be fulfilled
Information shall be furnished after obtaining certificate under Form 15CB
To be filled up after obtaining:
·         Certificate in Form No. 15CB; or
·         Certificate from AO for deduction at lower rate or for proportionate deductions; or
·         Order from AO for Nil deduction of tax.
Type of Information to be filled in
Particulars of remittance and TDS. This information is now sought in Part C of Form 15CA as amended on August 05, 2013 and in Part B of Form 15CA applicable from October 1, 2013
·         Details of Remitter, Remittee and Remittance
·         Information regarding the country of residence of remittee if available
·         Appropriate Certificate is required to be furnished including Form 15CB
·         Mandatory application of Section 206AA, if remittance chargeable to tax and PAN not available
·         Other particulars as specified in Part C of old Form 15CA
·         No information to be furnished if Remittance covered by Specified List & not to be reported in Form 15CA
Part C of Form 15CA
Who shall have to fill it?
Not Applicable
Not Applicable
What information is to be filled in?
Not Applicable
All the particulars specified in Part C of Form 15CA are included in part B of new Form 15CA, with an exception that no information shall be required to be furnished if the remittance which isn't chargeable to tax.
Conditions to be Specified
Not Applicable
Not applicable (same was provided for in Part B of Form 15CA)