NRI sending money outside

India - Transfer funds from NRO

to NRE

Updated rules on Form 15CA, 15CB

requirement

When it comes to transfer of funds abroad for various reasons by individuals, all financial institutions such as banks must ensure that proper documentation as specified by the government is obtained from the person remitting the funds abroad. What forms are required to be filled and under what circumstances are specified in Rule 37BB of the Income tax act. From time to time changes can be made as per government policy and tax rules amended to reflect such changes. The Central Board of Direct Taxes [CBDT] issued a Press Release dated 17th December, 2015 and a Notification No. G.S.R. 978(E) dated 16th December, 2015 to amend Rule 37BB of the Rules for the furnishing of information in respect of payments made to a non-resident. The notification announced simpler rules effective April 1, 2016 in cases where anyone making a payment to an individual or company abroad or an NRI remitting money outside India. This would also apply to transfers from NRO to NRE account as such a transfer is similar to transferring funds out. Provided below is a summary of the new procedures announced. Summary of changes under Rule 37BB for providing Form 15CA – Form 15CB Anyone making payment to a non-resident or an NRI remitting money outside India or transferring from NRO to NRE account. The changes under the revised Rules, effective April 1,2018 are: • Form 15CA and 15CB will NOT be required for o Any payments included in the specified list. The nature of payment in specified list has been expanded from 28 to 33 including payments for imports, family maintenance and savings. [ To view copy of specified list Click HERE ] o Any payment by an individual for remittance which do not requiring RBI approval under its Liberalized Remittance Scheme (LRS) The revised Form 15CA now has four parts known as Parts A, B, C and D. Parts of the form that are required to be filled depend on the submission conditions applicable. • For payment chargeable to tax, if total payment does not exceed Rs. 5 Lakh for the financial year o Part A of Form 15CA is required. • For payment NOT chargeable to tax, if total payment does not exceed Rs. 5 Lakh for the financial year o Part D of Form 15CA is required • Where the amount is more that Rs. 5 Lakh then: o A certificate from Assessing Officer under Section 197 o An order from Assessing Officer under section 195(2) or 195(3) o Part B of Form 15CA has to be provided o Certificate in Form 15CB from an accountant o Part C of Form 15CA No submission of information is required is the following cases: • The remittance is made by an individual and it does not require prior approval of Reserve Bank of India [as per the provisions of section 5 of the Foreign Exchange Management Act, 1999 (42 of 1999) read with Schedule III to the Foreign Exchange (Current Account Transaction) Rules, 2000]; Or • The remittance is of the nature specified in the list provided in Rule 37BB - Specified list can be viewed on our website at http://nriinformation.com/articles7/remit- purpose-list.htm Both Form 15CB and Form CA may be required in full in case where assessment order or certificate has NOT been obtained and the amount of payment is more than Rs. 5 Lakh