Annual Membership fee-Required to issue 15CB instead of 15 CA Part-D?

As per the provisions of the Income Tax Act, TDS is applicable on payments made to a non-resident for services rendered in India or for services that are utilized in India. However, there is a specific provision under Section 9(1)(vi) of the Income Tax Act that exempts payments made for the use of computer software from TDS, provided that the payment is not in the nature of royalty or fees for technical services.

If the annual fee paid for the subscripttion of software is for the use of the software and does not involve any transfer of technology or technical knowledge, then it may not be considered as royalty or fees for technical services, and TDS may not be applicable.

If the payment for the annual membership fee is being made to a non-resident and the amount exceeds ₹5 lakh in a financial year, then Form 15CA Part C is generally required, not Part D, as it involves a taxable remittance under Section 195.

However, if the payment is below ₹5 lakh, or if there is no tax liability (i.e., the nature of the remittance is such that no TDS is applicable), then Form 15CA Part D can be filed, where the CA certifies that no tax is required to be deducted.

If TDS is applicable, then Form 15CB is required in addition to Form 15CA Part C, where the CA will certify the TDS deduction details.

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