TDS Sections Where Form 15CA & 15CB Declaration is Necessary

TDS Sections Where Form 15CA & 15CB Declaration is Necessary

When making foreign remittances from India, the Income Tax Act, 1961, requires compliance with Tax Deducted at Source (TDS) provisions. In certain cases, Form 15CA and 15CB must be filed to certify that appropriate taxes are deducted before remitting funds abroad. These forms act as a declaration to the Income Tax Department that the remittance follows tax regulations.

4 Mar 2025•
13 min read

When making foreign remittances from India, the Income Tax Act, 1961, requires compliance with Tax Deducted at Source (TDS) provisions. In certain cases, Form 15CA and 15CB must be filed to certify that appropriate taxes are deducted before remitting funds abroad.These forms act as a declaration to the Income Tax Department that the remittance follows tax regulations.

In this blog, we will explore the key TDS sections where Form 15CA and 15CB declarations are necessary and the conditions under which they apply.

Section 195: TDS on Payments to Non-Residents

  • Applicability: This section mandates TDS on any sum chargeable to tax under the Act, paid to a non-resident, excluding salaries.​Income Tax Department+2Canara Bank+2HDFC Life+2
  • Form 15CA: The remitter must furnish this form as a declaration of the remittance details.​Wikipedia+6Bharti AXA Life+6Tax2win+6
  • Form 15CB: A certificate from a Chartered Accountant is required when the remittance exceeds ₹5 lakh in a financial year and is taxable.

Section 194E: TDS on Payments to Non-Resident Sportsmen or Sports Associations

  • Applicability: TDS is required on income paid to non-resident sportsmen, including athletes, and sports associations or institutions.​Canara Bank
  • Forms 15CA and 15CB: These forms are necessary to certify the nature and taxability of the payment.​

Section 196A: TDS on Income from Units to Non-Residents

  • Applicability: TDS applies to income in respect of units of mutual funds paid to non-residents.​
  • Forms 15CA and 15CB: Required to ensure appropriate tax compliance on such remittances.

Section 196B: TDS on Income from Foreign Currency Bonds or Shares of Indian Companies

  • Applicability: TDS is deducted on income from foreign currency bonds or shares of Indian companies payable to non-residents.​
  • Forms 15CA and 15CB: Necessary to declare and certify the tax details of these payments.

Section 196C: TDS on Income from Foreign Currency Bonds or Global Depository Receipts

  • Applicability: Pertains to income from foreign currency bonds or Global Depository Receipts (GDRs) payable to non-residents.​
  • Forms 15CA and 15CB: Required for reporting and certifying tax compliance on these incomes.

Section 196D: TDS on Income of Foreign Institutional Investors from Securities

  • Applicability: TDS is applicable on income earned by Foreign Institutional Investors (FIIs) from securities.​
  • Forms 15CA and 15CB: These forms must be submitted to ensure proper tax deduction and reporting.

It's essential for remitters to assess the nature and amount of the payment to determine the necessity of these forms.Non-compliance can lead to penalties under Section 271I, including fines up to ₹1 lakh.