Introduction
Cross-border payments are a critical area of compliance under Indian tax law. For years, taxpayers relied on Form 15CA and Form 15CB under the Income-tax Act, 1961 to declare and certify remittances made to non-residents. These forms ensured transparency, proper deduction of tax at source (TDS), and compliance with DTAA provisions.
With the Income-tax Act, 2025 coming into effect from 1 April 2026, the compliance framework has been modernized. The old Form 15CA/15CB system is replaced by Form 145 and Form 146. While the substantive requirements remain the same, the new system is more digital, streamlined, and fraud-resistant.
Old vs. New Framework
Under the old Act, compliance was governed by Section 195(6). Form 15CA was the taxpayer’s declaration, while Form 15CB was the Chartered Accountant’s certificate.
Under the new Act, compliance is governed by Section 397(3)(d). Form 145 replaces Form 15CA, and Form 146 replaces Form 15CB. The Income-tax Rules, 2026 prescribe the structure and thresholds for these forms.
Key differences include:
- Form 145 → taxpayer declaration (new equivalent of 15CA).
- Form 146 → CA certificate (new equivalent of 15CB).
- Verification → UDIN-enabled real-time checks.
- Filing mode → fully online, integrated with the e-filing portal.
Validity of Old Forms
Forms 15CA and 15CB filed for remittances up to 31 March 2026 will remain valid even after the new Act commences, provided the remittance was executed within the period specified. If the remittance was delayed beyond that period, fresh forms must be filed under the applicable law.
Applicability from 1 April 2026
From 1 April 2026 onwards, taxpayers must use Form 145 and Form 146. The substantive requirements remain unchanged, meaning taxpayers must:
- Furnish remittance details.
- Obtain a CA certificate for amounts exceeding thresholds.
- Ensure proper TDS compliance.
Thresholds under Rule 220
The thresholds for filing remain similar to the old framework.
- Form 145 must be filed for all taxable remittances.
- Form 146 is required if the remittance exceeds prescribed limits.
This continuity ensures taxpayers are not burdened with new thresholds, but must adapt to new form numbers and structures.
Special Situations: Accrual vs. Remittance
A common situation arises when a liability accrues under the old Act but the payment is made under the new Act. For example:
- Liability accrued in February 2026 under the 1961 Act.
- Payment made in April 2026 under the 2025 Act.
In such cases:
- The procedural requirement follows the law in force on the date of remittance (2025 Act → Form 145/146).
- The taxability of income is governed by the Act applicable to the year of accrual (1961 Act).
Structure of Form 145
Form 145 is divided into four parts, each designed to cover different scenarios:
- Part A — For taxable remittance up to ₹5 lakh.
- Part B — For taxable remittance above ₹5 lakh with AO certificate.
- Part C — For taxable remittance above ₹5 lakh with CA certificate (Form 146).
- Part D — For non-taxable remittance (other than payments under Rule 220(3)).
A key benefit of the new framework is that if Part B is furnished with an AO certificate, Part C is not required. This eliminates duplication and reduces compliance costs.
Form 146 and UDIN
Form 146 introduces the Unique Document Identification Number (UDIN). This is generated by ICAI and allows real-time verification via API.
Benefits of UDIN include:
- Ensures authenticity of CA certificates.
- Prevents fraud and misuse.
- Provides confidence to both taxpayers and the Department.
Filing Process
The filing process has been simplified and digitized. Taxpayers must:
- Log in to the Income Tax e-Filing portal.
- Navigate to Foreign Remittance Compliance and select Form 145.
- Enter details of the payer, payee, nature, and amount of payment.
- Upload Form 146 if required.
- Validate details using system checks.
- Submit using DSC or EVC and download acknowledgement.
Documents Required
To file Form 145 and 146, taxpayers should keep ready:
- PAN of the remitter.
- Details of the foreign recipient.
- Nature and purpose of the remittance.
- Invoice or agreement copy.
- Tax Residency Certificate (if DTAA is claimed).
- TDS calculation details.
Practical Checklist for Remitters
Here is a quick reference for different scenarios:
- Remittance before 31 March 2026 → IT Act, 1961 → Form 15CA/15CB.
- Remittance on or after 1 April 2026 → IT Act, 2025 → Form 145/146.
- Liability accrued Feb 2026, paid Apr 2026 → Accrual under 1961 Act, remittance under 2025 Act → Form 145/146.
- Remittance ≤ ₹5 lakh → Form 145 Part A.
- Remittance > ₹5 lakh with AO certificate → Form 145 Part B (no CA certificate required).
- Remittance > ₹5 lakh with CA certificate → Form 145 Part C + Form 146.
- Non-taxable remittance → Form 145 Part D.
Impact on Businesses and Professionals
For businesses making payments to non-residents, the shift to Form 145 and 146 means updating internal compliance checklists, training finance teams on new forms, coordinating with Chartered Accountants for UDIN-enabled certificates, and ensuring AO certificates are obtained where applicable to reduce duplication.
For professionals, the new framework offers opportunities to streamline advisory services and reduce client costs. Banks also benefit from integrated checks that reduce delays and errors.
Penalties for Non-Compliance
Failure to comply with the new framework may result in penalties under the Income-tax Act, disallowance of expenses under Section 40(a)(i), delay or rejection of payments by banks, and scrutiny notices from the tax department.
Practical Examples
- A company making a payment for technical services to the USA must file Form 145 along with Form 146.
- A company importing goods usually faces a non-taxable remittance, requiring Form 145 Part D but not Form 146.
- A company paying royalty and claiming DTAA benefit must file Form 145 and obtain Form 146 to certify the lower tax rate.
Conclusion
The transition from Form 15CA/15CB to Form 145/146 under the Income-tax Act, 2025 is a modernization of India’s foreign remittance compliance. The new framework retains thresholds and substantive requirements, eliminates duplication between AO and CA certification, introduces UDIN verification for authenticity, and simplifies filing with a four-part structure.
For taxpayers and professionals, the message is clear: From 1 April 2026, file Form 145 and 146; not 15CA/CB. By embracing the new framework, businesses can ensure smooth compliance, reduce costs, and strengthen trust in cross-border transactions.