Friday, 27 September 2013

Notification issued by CBDT on new procedure on non-resident payments and revised forms 15CA and CB.

The Central Board of Direct Taxes has issued notification no 67/2013 dated 2 Sept 2013 relating to remittance procedure for non resident payments. The new notification prescribes a revised process for payments made to non-residents.  It is applicable with effect from 1 October 2013.

The new notification prescribes following tax procedure for remittances to the non-residents:
  • All taxable remittances (including salary or interest ) are required to be reported in a new Form 15CA
  • The new Form 15CA prescribed two categories (i.e. Part A and Part B) of remittance as follows:
    • Part A is applicable where amount does not exceed Rs. 50000 and the aggregate of remittance made during the financial year does not exceed Rs. 250000.
    • Part B is applicable where remittance is chargeable to tax and exceeds Rs. 50000 and the aggregate of remittance made during the financial year exceeds Rs. 250000. Part B needs to be submitted along with Form 15CB/ a certificate from the assessing officer under section 197 or an order from the assessing officer under sub-section (2) or sub-section (3) of section 195 of the Income-tax Act, 1961.
  • For the remittances covered in 'Specified List', Form 15CA and Form15CB are not required to be submitted. This Specified List covers 29 type of remittances (aligned with RBI purpose code in Form A2) such as remittance towards business travel, travel under basic travel quota, travel for medical treatment/education, family maintenance and savings etc

In view  of the above, for processing any foreign remittance from 1 October 2013 onwards, the documents as per the above procedure will be required for processing remittances to the non-residents.