Monday, July 13, 2015

Form 15CB Required in Case of Payments for Imports

Section 195 of the Income Tax Act 1961 dealing with payments to non-resident has been amended with effect from 01.06.2015. 

As per the amended Section 195(6), CA certificate in form 15CB is required to be obtained in all the cases of payments to non-resident, even in case the amount paid is not chargeable to tax in India. It is also mandatory for the payer to file an online Form 15CA in the format prescribed under Rule 37BB.

A penalty of Rs. 1,00,000/- may be levied on the payer for non-furnishing or incorrect furnishing of information in Form 15CA.

It may also be noted that the following information is required for issuing each Form 15CB:

1. Invoice: It should have complete details such as:
a. Date
b. Name and Address of Vendor (Address should be of country of remittance)
c. Name and Address of Purchaser
d. Amount of Payment in Foreign Currency
e. Description of Particulars and Nature of Payment

2. Proposed Date of Payment

3. Foreign Exchange Rate at which payment is being made and the amount of Rupees being paid

4. Details of Bank through which payment is being made:
a. Name and Address of Bank Branch
b. BSR Code

5. Details (Name and Address) of Foreign Bank to which payment is being made.

6. Tax Residency Certificate issued by the Tax Authorities of the country of the vendor, which should state the following information:
a. Name and Address of the assessee
b. Status of the assessee (individual, firm, company, etc.)
c. Nationality (in case of individual)/Country or specified territory of registration
d. Assessee’s Tax Identification Number in the country of residence
e. Residential status for the purpose of tax
f. Period for which the certificate is applicable

7. Form 10F duly filled and signed by the vendor receiving payment (format here)

8. A Certificate that the vendor does not have a Permanent Establishment in India.