15cb form applicable or not payments to crew etc

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 November 2013 Dear Experts,

A company is paying to singapur based company for vessel attendance charges and transportation & meal of crew. Amount to be paid is more than Rs.250,000/-

Is it necessary to get 15CB from CA??
Can said company take benifit of circular and use purpose code S0202 for exemption?

Querist : Anonymous

Querist : Anonymous (Querist)

18 November 2013 Dear Experts,

Please express your views.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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14 July 2024 In the scenario where an Indian company is making payments to a Singapore-based company for vessel attendance charges, transportation, and meal expenses of crew, here are the considerations regarding Form 15CB and the applicability of Circular and purpose code for exemption:

### Form 15CB Requirement:

1. **Form 15CB:**
- Form 15CB is required when an Indian resident makes a payment to a non-resident (which includes foreign companies) and the payment is subject to withholding tax under Indian income tax laws.
- Since the payment amount exceeds ₹ 250,000, it triggers the requirement for Form 15CB. This form needs to be certified by a Chartered Accountant (CA) and submitted electronically before making the payment to the Singapore-based company.

### Circular and Purpose Code:

2. **Circular for Tax Relief:**
- You mentioned using purpose code S0202 for exemption. Circulars issued by the Income Tax Department sometimes provide relief from TDS (Tax Deducted at Source) or specify reduced rates of TDS for specific types of payments to non-residents.
- To avail benefits under a circular for exemption or reduced TDS rates, the Indian company would typically need to fulfill the conditions specified in the circular.
- It’s important to verify the specific circular (if any) and ensure that the payment qualifies for the relief as per the conditions mentioned therein.

3. **Purpose Code S0202:**
- Purpose code S0202 is used for payments for vessel-related expenses, including crew-related expenses, in accordance with RBI guidelines.
- The use of purpose code S0202 helps in categorizing the nature of payment and ensuring compliance with RBI regulations.

### Procedure:

- **Form 15CB:** Obtain Form 15CB from a CA certifying details of the payment, the nature of the payment, and compliance with Indian tax laws.
- **Form 15CA:** After obtaining Form 15CB, the Indian company needs to fill out Form 15CA online on the Income Tax Department’s portal and submit it electronically.
- **Circular Benefit:** If the payment qualifies under a circular for exemption or reduced TDS rates, ensure all conditions are met and proper documentation is maintained.

### Professional Advice:

- Given the complexities involved, especially with international transactions and tax implications, it’s advisable to consult with a Chartered Accountant or tax advisor. They can guide you through the process, ensure compliance with Indian tax laws, and help you avail benefits under relevant circulars if applicable.

By following these steps and obtaining necessary certifications and documentation, the Indian company can comply with Indian tax laws while making payments to the Singapore-based company for vessel attendance and crew-related expenses.

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