Form 145 (Previously 15CA) for Payments to Foreign Consultants
Learn when Form 145 (Previously 15CA) is required for payments to foreign consultants, including taxability, TDS, DTAA considerations.
Businesses often hire consultants outside India for management advice, business strategy, technology, marketing or other professional services.
Before making the payment, however, the business should first determine the tax treatment of the service and whether Form 145 is required.
Is Form 145 (Previously 15CA) Required?
Form 145 applies to qualifying payments to a non-resident who is not a company or to a foreign company, subject to the conditions and exclusions under the applicable rules. It is filed before the remittance.
The applicable part depends on the taxability of the payment and the aggregate amount during the tax year.
For example, if an Indian company pays a foreign consultant ₹3 lakh for consulting services, the company should first establish whether the payment is chargeable to tax in India. If it is a qualifying taxable remittance and the aggregate remains within the applicable ₹5 lakh threshold, Part A may apply.
If the amount exceeds ₹5 lakh, the taxpayer needs to consider the Part B or Part C route, depending on whether an Assessing Officer certificate/order or Form 146 is being used.
What Should You Check?
Before making the payment, review:
- Consultant agreement
- Invoice
- Nature of services
- Country of the consultant
- Taxability in India
- DTAA, where relevant
- TDS treatment
- Aggregate qualifying remittances during the tax year
Don't assume that every foreign consulting payment has the same tax treatment. The actual services and applicable treaty provisions matter.
How 145146.com Can Help
For companies making payments to several overseas consultants, preparing each Form 145 manually can become repetitive.
145146.com helps businesses manage Form 145 and Form 146 workflows in bulk, including data preparation, form generation and uploading, along with tax assistance.
For consultant payments, this can help bring the transaction information, tax review and filing process into one workflow.
Final Takeaway
Before paying a foreign consultant, don't start with the form. Start with the nature of the service and its taxability. Once that is clear, determine the appropriate Form 145 (Previously 15CA) route.