A new draft format Form No. 42 has been introduced proposing a detailed application framework for obtaining a Certificate of Residence for the purposes of agreements under Section 159(1) and 159(2). The draft form aims to standardize the information required from applicants seeking a Tax Residency Certificate (TRC) and improve clarity in documentation.
The proposed form lays out comprehensive disclosure requirements covering personal details, residency status, purpose of obtaining the certificate, and supporting documentation, reflecting a move toward more structured compliance.
Objective of Draft Form No. 42
The draft form is designed to streamline the process of applying for a residence certificate by clearly defining the particulars and annexures required. It provides a uniform format for both individuals and entities to establish their residency status in India for treaty purposes.
Key Details Required in the Draft Form
The form is divided into two main sections- Applicant Details and TRC Information, along with a verification segment.
Part A: Particulars of the Applicant
Applicants are required to provide:
- Full name and address details
- Communication address in India
- Permanent Account Number (PAN)
- Email ID and contact number
These details help establish identity and ensure proper communication during processing.
Part B: Details for Tax Residency Certificate
The draft requires applicants to furnish detailed residency information, including:
- Status of the applicant (individual, company, firm, trust, LLP, etc.)
- Nationality or country of incorporation
- Address during the period for which TRC is sought
- Period of stay in India and number of days
- Basis on which resident status is claimed
- Period for which the certificate is applicable
- Purpose of obtaining the TRC
Applicants must also attach supporting documents as annexures.
Supporting Documents and Annexures
The draft specifies that applicants may need to submit:
- Passport copies
- Incorporation or registration documents
- Proof of stay in India
- Any other relevant information
This requirement is intended to strengthen verification and reduce ambiguity in determining residency status.
Verification Requirement
The form includes a declaration where the applicant must affirm that the information provided is true and complete. The verification must be signed by the applicant or an authorized person along with designation and PAN details.
Expected Compliance Impact
The introduction of Draft Form No. 42 is expected to:
- Bring uniformity in TRC applications
- Improve documentation standards
- Reduce processing ambiguities
- Strengthen verification of residency claims
- Enhance transparency in treaty-related compliance
Moving Toward Structured Tax Documentation
The draft reflects a broader trend toward more detailed and standardized tax forms aimed at improving administrative efficiency and ensuring accurate reporting. Once finalized, the form is likely to provide clearer guidance to taxpayers seeking residency certification for treaty benefits.
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