File form 15CA and 15CB online – A step by step process

In this article my aim is to explain the detailed procedure vis-a-vis how a non-resident can get his 15ca prepared & file online; along with a 15cb certificate to transfer funds from his bank account.

What are forms 15 CA and CB all about?

Transferring funds outside India and understanding taxes involved with it, is never a simple issue for NRIs. But when you are trying to pay money across international boundaries it can become more confusing. When paying for salaries, goods or services rendered to a non-resident person or a non-resident entity, there are certain considerations to bear in mind regarding taxes. And with constant rule changes, it’s tough to know what forms or paperwork you need to fill out and where to submit it.

In the case of India, if you are looking to remit any taxable money to a foreign individual or company, you need to complete forms ’15 CA/CB’, in accordance to the rules set in the Income Tax Act of 1961. Note that as of October 2013, this is only applicable on taxable transfers, such as salary payments or rents. It is not necessary to fill out one of these forms every time you want to send your cousin in Germany a few bucks.

If you are, however, transferring money to a foreign company or individual that is liable for tax, it is an essential legal requirement that you fill out these forms, and essential that you do so before the payment is made. The reasoning is quite simple, if tax – including tax deductible at source (TDS) – is to be paid, the treasury needs to know and be able to extract it before the money leaves the country. Else tax will still be owed, but it can be costly and time consuming for the treasury to pursue.

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How to prepare and e-file online?

Form 15CA has to be filled electronically in the website designated by the Income-tax Department website, printed, signed and submitted before remitting the payment.

NOTE: 15CA form can be filed at the NSDL site, ONLY AFTER you have obtained a certificate from a registered chartered accountant. It his duty to scrutinize your papers and transaction and certify that your dealings are clean and that the banker can allow you to remit or transfer money outside India. One such reliable tax and accounting firm in India is nriInvestIndia, that can issue you a 15cb certificate within 2 days.

Preparing the 15cb as per the latest format can be very confusing, thus it’s advisable to get some sort of professional help.

When filling the form as a remitter, you will need:

  • Your Permanent Account Number (PAN) and Tax Deduction and collection Account Number (TAN) allotted by the Income Tax Department.
  • If you don’t have a TAN, it is mandatory to quote your PAN.
  • Details in at least two address fields.
  • Name of the entity doing the remittance should be mentioned in the “Name of remitter” field.
  • Don’t fill the Area code, AO type, Range code or AO number. These fields will be filled by the system based on your PAN or TAN.


Points to note:

Working out whether you need to submit, however, is not so simple. The following rules are important to be aware of:

  • First and foremost, we are talking about remittances where tax needs to be paid.
  • There is a specified list (see below) of activities which do not need any evidence submitted.
  • For payments during a single financial year totaling over Rs.50,000 but less than Rs.250,000, you need to complete part A of form 15 CA, and you do not need to obtain Form 15CB.
  • For all other taxable payments, you need to report in Part B of form 15CA, and it is mandatory to obtain the certificate of a chartered accountant in form 15 CB.

Exempted areas:

According to the Notification No. 67/2013 [F. NO. 149/119/2012-SO (TPL)]/SO 2659(E), dated 2-9-2013, list of activities for which you have to submit no further information are:

  • Indian investment abroad -in equity capital (shares)
  • Indian investment abroad -in debt securities
  • Indian investment abroad -in branches and wholly owned subsidiaries
  • Indian investment abroad -in subsidiaries and associates
  • Indian investment abroad -in real estate
  • Loans extended to Non-Residents
  • Payment- for operating expenses of Indian shipping companies operating abroad.
  • Operating expenses of Indian Airlines companies operating abroad
  • Booking of passages abroad -Airlines companies
  • Remittance towards business travel.
  • Travel under basic travel quota (BTQ)
  • Travel for pilgrimage
  • Travel for medical treatment
  • Travel for education (including fees, hostel expenses etc.)
  • Postal services
  • Construction of projects abroad by Indian companies including import of goods at project site
  • Freight insurance – relating to import and export of goods
  • Payments for maintenance of offices abroad
  • Maintenance of Indian embassies abroad
  • Remittances by foreign embassies in India
  • Remittance by non-residents towards family maintenance and-savings
  • Remittance towards personal gifts and donations
  • Remittance towards donations to religious and charitable institutions abroad
  • Remittance towards grants and donations to other Governments and charitable institutions established by the Governments.
  • Contributions or donations by the Government to international institutions
  • Remittance towards payment or refund of taxes.
  • Refunds or rebates or reduction in invoice value on account of exports
  • Payments by residents for international bidding

NOTE: Please be advised that filing such paperwork with the Income tax department can be confusing. Thus, a help from a professional CS (company secretary) or CA (chartered accountant) should be rendered.


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e-File yourself (do everything yourself)

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How to reduce capital gains tax when you sell property in India?

If you are living outside of India as an NRI, and are looking to sell your property in India, there are some rules that go along with it. If you hold an immovable home in India that is not a farm or farm house that you got by inheriting it, it can be sold to both Indian residents as well as NRIs. If you have a farm or farm house that you received by inheriting it, then you cannot sell it to an NRI, only Indian residents.

There are ways to reduce the amount of taxes that you have to pay. One way would be that you use the profits you gain by selling your property and invest it into a new property that you would like to buy or build. You would have to purchase the new property within a few years for you to qualify for your tax exemptions.

When you are preparing to sell in India, be sure that you find a legit property dealer as there are a lot of frauds out there now.

How to get the money from your property in India?

If you bought the property when you were an Indian resident with Indian Rupees, then you will need to put all of the profit into your NRO account for accessing as an NRI. If you bought the property after you were already living abroad, then you can get the money in your country. Also, if you paid for the property using your NRE account, you can put the money you get from selling it back into your NRE account.

In order to buy or sell property in India, you will need a Permanent Account Number (PAN). You can start your process for PAN online through the PAN website. You can apply from your country abroad if you wish to. A good site to start this would be: http://www.pancardonline.com/apply.html

Tax rates on Mutual Fund Investment for NRIs.

India is one of the favourite investment destinations for investors all over the globe and especially for NRI’s. India has seen a huge jump in the investments made by NRI’s in India and one such instrument is investments in Mutual funds.

The only thing that restricts lot of NRI’s to invest is the lack of knowledge relating to the taxation rules with respect to NRI investment in Mutual funds. All investors should have the basis knowledge about taxation which will help them in choosing the product they want to invest in more prudently.

Here is an attempt to cover Mutual Fund Taxation for NRIs specifically.

Income from Mutual Fund can be divided into 1. Capital Gains or 2. Dividends. So taxation of Mutual Funds in India can be divided in 2 parts Capital Gain & Dividends.

Taxation on Capital Gains

In order to understand the taxation rules with respect to capital gains it would be wise to understand what capital gains mean. Capital gains can be defined as “the appreciation in value of the investment with respect to the investment originally made is called Capital gains”.

So let’s say an investor invests INR 100,000 in a mutual fund and is able to sell it for INR 150,000 the extra 50,000 that he made after selling his units is termed as capital gains.

If the investors sells the allotted mutual fund units before 365 days of making the investment it is termed as Short Term Capital Gains; and

If the investors sells the allotted mutual fund units after 365 days of making the investment it is termed as Long Term Capital Gains.

The taxes on the capital gains are also dependent on the kind of fund the investment is made in and can be divided in two parts Capital gains in Equity funds and Capital gains in Debt funds.

Capital Gain Tax on Equity Mutual Funds

Any fund that has more than 65% holding in equities will be termed Equity Fund and the rest are termed as debt funds.

Long term capital gains on equity funds is tax free whereas short term capital gains in equity funds attracts 15% TDS in case of NRIs.

Capital Gain Tax on Debt Mutual Funds

A fund that is not an equity fund can be termed as debt fund and in case of NRIs the mutual fund companies deduct a TDS of

30% in case of short term capital gains and

20% in case of long term capital gains.

Taxes on Dividends

In order to understand the taxation rules with respect to dividend it would be wise to understand what dividends mean. Dividends can be defined as “the payment received from the mutual fund companies at regular intervals when an investor chooses the dividend option instead of the growth option”.

As Capital gains taxation on dividends and dividend distribution taxes are based on the type of Mutual Fund the investment is made – Equity or Debt.

Taxes on Dividends from Equity Mutual Funds

Dividends in case of an equity fund are tax free at the hands of the investors and there is no dividend distribution tax for the mutual fund companies for equity funds.

Similarly there is not tax on the dividends received from debt mutual funds but the Mutual fund companies are liable to pay dividend distribution tax to the Income tax department.

Dividend Distribution Tax on Debt Mutual Funds

There are no taxes on dividend distribution in case of equities mutual fund.

Dividend Distribution Tax on Debt Mutual Funds

The dividend distribution taxes are again based on the type of fund the investment is made in.

Dividend Distribution Tax on Liquid/Money Market Schemes

Any fund which invests in money market instruments or in securities that have maturity of less than 90 days is called Liquid/Money Market Schemes.

Mutual fund companies are liable to pay 27.038% tax (25% Tax + 5% Surcharge + 3% Cess) and hence the same is deducted from the dividends.

Dividend Distribution Tax on Debt Funds other than Liquid/Money Market Schemes

Here 13.519% tax (12.5% Tax + 5% Surcharge + 3% Cess) will be deducted from the dividends.

NRI Tax on Indian Mutual Funds

How NRIs can file TAX in India?

ATTENTION: NRIs, PIOs, OCIs, Foreign Citizens & International Companies

Deadline to File Indian Tax returns online is coming soon.!

# Non-Residents Indians must file taxes if:
1. You are generating income from India (bank accounts, rental income, etc).
2. Capital Gains accruing through real estate, stock market & other investments.
2. Taxes are with-held in excess of Income offered to tax.
3. To claim double taxation treaty benefits in countries like (US, UK, etc).
4. To become tax compliant as per Indian tax laws.
5. Get TDS refunds & other exemptions.

# Benefits of filing taxes in India:
1. It acts as a Standard Income proof (required at many places).
2. Speeds up various loan application process – mainly housing loans.
3. Helps you claim tax refund (TDS).
4. Improves your credit history.

India Tax filing made SIMPLE & HASSLE FREE.!

>> CLICK HERE – if you want to File TAXES OR have Questions.!

Enjoy…