If you are looking to send money overseas from India, you should be aware that the government of India has introduced several important changes to the reporting of foreign remittances. Sending money overseas from the country now involves a revised tax compliance process.
The Income Tax Department has replaced the earlier Forms 15CA and 15CB with Forms 145 and 146, the new forms for reporting foreign remittances.
You are required to complete these forms before making certain payments to non-residents, foreign companies or NRIs. Banking institutions, associated parties, and authorised dealers may ask you to submit these documents before processing international transfers.
The objective of these changes is to streamline disclosures, increase transparency and improve tax compliance for payment-related interactions with overseas parties.
What is Form 145?
Form 145 is a self-declaration to be filed by the person who wishes to make the remittance. This document captures the key transaction details such as:
- The nature of the payment made.
- The total amount being sent abroad.
- The applicable tax is deducted at source (TDS).
- Complete details of the recipient and remitter.
This form is required before the remittance is processed.
What is Form 146?
Form 146 is a certificate. A Chartered Accountant issues this in specific cases. It helps in confirming the following:
- Whether the payment is taxable in India or not.
- Express mention of the provisions under the income tax law.
- The updated and correct TDS rate applicable to the remittance.
This form is primarily needed when professional certification is mandatory for regulatory compliance.
Who needs to file these forms?
These forms may apply to you if you are:
- Sending funds abroad to an NRI or any foreign entity.
- Making taxable remittances such as royalty, consultancy fees, commission or service-related payments.
- Transferring funds where banking institutions and associated financial institutions seek proof for clarity and tax compliance.
When Form 146 may not be required
In some cases, only Form 145 may be sufficient, especially when:
- The transaction is not subject to tax in India.
- Certification of the CA is not mandatory under the rules and regulations.
What is the importance of both these forms?
It is important to keep in mind that foreign remittances are closely tracked and monitored by tax authorities. Mistakes, omissions and incorrect documentation can delay payments or trigger additional checks and background verifications by financial institutions.
Hence, anyone who plans to send funds overseas in 2026 and beyond must check whether Form 145 alone is sufficient or whether Form 146 is also required. It is prudent, therefore, to consult a tax professional for guidance to avoid delays and compliance issues and to ensure a smooth fund transfer.
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