What Are the Consequences of Late Filing Form 145?

What Are the Consequences of Late Filing Form 145?

Learn the consequences of late filing Form 145 for foreign remittances. This article explains how delayed submissions can postpone overseas payments, increase compliance risks, require additional documentation and lead to avoidable filing errors, along with practical steps to ensure timely and accurate compliance.

13 Jul 2026•
10 min read

Form 145 must generally be submitted before making a foreign remittance where it is applicable. Delaying the filing can affect both tax compliance and the release of the overseas payment.

1. Delay in Foreign Remittance

Banks (Authorised Dealer Banks) generally require the necessary tax documentation before processing eligible foreign remittances. If Form 145 has not been filed where required, the payment may be delayed until the compliance requirements are completed.

2. Delay in Business Transactions

Late filing can postpone:

  • Royalty payments
  • Technical service fees
  • Foreign vendor payments
  • Dividend remittances
  • Interest payments
  • Commission payments

This may impact contractual timelines and vendor relationships.

3. Additional Compliance Work

If the delay is due to missing information, you may need to:

  • Recalculate TDS.
  • Obtain additional documents such as a Tax Residency Certificate (TRC).
  • Arrange Form 146 certification, where Part C applies.
  • Update remittance details before filing.

4. Increased Risk of Errors

When filings are completed at the last minute, common mistakes include:

  • Incorrect TDS rates.
  • Wrong RBI Purpose Codes.
  • Missing mandatory fields.
  • Incorrect remittance details.

These errors may require corrections before the payment can proceed.

Practical Example

An Indian company plans to pay a foreign consultant on 30 September. Since the payment is taxable and exceeds the prescribed threshold, Form 146 is required before filing Form 145 Part C. Because the documents are prepared only on the payment date, the remittance is postponed until the compliance process is completed.

How to Avoid Delays

  • Review foreign payments well in advance.
  • Determine taxability early.
  • Collect DTAA documents before filing.
  • Obtain Form 146 where required.
  • Validate all information before submission.

Conclusion

Although the Income-tax Act does not prescribe a separate "late filing fee" specifically for Form 145, failing to complete the required filing before an applicable remittance can delay the transaction and increase compliance risks. Planning ahead helps ensure smoother foreign remittance processing.