Understanding Form 145/146 under the Income Tax Act, 2025 for Foreign Remittances

With the implementation of the Income Tax Act, 2025, several income tax forms have been renumbered. One such important change is the replacement of Form 15CA with Form 145, a key document for businesses involved in foreign remittances. Understanding the requirements of Form 145 will help ensure smooth operations and avoid delays with your bank.

What is Form 145?

Form 145 is a crucial declaration filed before remitting money outside India. It provides the Income Tax Department with comprehensive details of the foreign payment, including:

• Name and details of the remitter and recipient
• Nature and purpose of the remittance
• Amount being remitted
• Taxability of the payment in India
• Details of tax deducted at source (if applicable)

This form ensures that the government verifies if the correct tax has been deducted before any money is sent abroad, replacing the earlier Form 15CA under the new tax framework. For more detailed guidance, refer to our Form 145 Guide for Foreign Remittance.

Who Needs to File Form 145?

Any individual or entity making a payment to a non-resident may be required to file Form 145 before the remittance is processed by an authorised dealer (bank). Some common examples of where Form 145 is necessary include:

• Consultancy fees
• Technical service fees
• Royalty payments
• Software licence fees
• Commission payments
• Interest payments
• Professional service fees
• Other taxable foreign remittances

Explore more about compliance for foreign remittance by visiting our Foreign Remittance Compliance Guide.

Different Parts of Form 145

Form 145 is divided into four parts, each applicable based on specific conditions.

Part A

Applicable where:

• The remittance is taxable in India; and
• The aggregate remittance during the tax year does not exceed ₹5 lakh.

Part B

Applicable where:

• The remittance exceeds ₹5 lakh; and
• The payer has obtained a certificate from the Assessing Officer under the applicable provisions.

Part C

Applicable where:

• The remittance exceeds ₹5 lakh;
• The payment is taxable in India; and
• A Chartered Accountant has issued Form 146 (earlier Form 15CB).

Part D

Applicable where:

• The remittance is not chargeable to tax in India (except specified exclusions under the Rules).

For a simplified breakdown, see our Simplified Form 145/146 Filing Guide.

Form 146 – The New Form 15CB

Under the Income Tax Act, 2025:

• Form 15CB → Form 146
• Form 15CA → Form 145

When a CA certificate is needed, the Chartered Accountant first uploads Form 146, enabling the remitter to then file Part C of Form 145. For a comprehensive understanding of these forms, view our Comprehensive Guide to 15CA/15CB Filing.

Documents Required

Before filing Form 145, ensure the following documents are ready:

• PAN of the remitter
• Details of the foreign recipient
• Invoice or agreement
• Purpose of remittance
• Amount in foreign currency and INR
• Tax Residency Certificate (TRC), wherever applicable
• Form 10F, if required
• Form 146 (where applicable)
• Lower/Nil deduction certificate, if obtained

For more detailed information on required documentation, refer to our Essential Documents for 15CA/15CB Filing.

How to File Form 145?

The filing process is entirely online and is conducted through the Income Tax e-Filing portal:

Steps:

1. Log in to the Income Tax e-Filing portal.
2. Navigate to e-File → Income Tax Forms.
3. Select Forms as per Income Tax Act, 2025.
4. Search and choose Form 145.
5. Determine the applicable part (A, B, C, or D).
6. Enter remittance details.
7. Verify using DSC or Electronic Verification Code (EVC).
8. Submit the form before executing the foreign remittance.

For pricing details and support, check our Form 145/146 Filing Pricing.

Key Change Under the New Law

A notable change under the new framework is that when Part B is filed based on an Assessing Officer's certificate, filing Part C is no longer required, eliminating the prior duplication process. For an in-depth understanding of these changes, view our Essential Guide to 15CA/15CB Filing.

Common Mistakes to Avoid

• Choosing the wrong part of Form 145.
• Incorrectly identifying the remittance's nature or purpose.
• Filing the form after the remittance has been made.
• Ignoring Double Taxation Avoidance Agreement (DTAA) benefits.
• Neglecting to obtain Form 146 where necessary.
• Miscalculating TDS.
• Mismatch between invoice, Form 145, and bank documents.

Conclusion

Although the form number has transitioned from 15CA to 145, the main objective remains unchanged: to assure accurate reporting of foreign remittances and adherence to tax deduction norms. Prior to any overseas payment, businesses should thoroughly evaluate payment taxability in India, necessity of Form 146, and which part of Form 145 is applicable. Proper compliance ensures seamless bank processes and mitigates potential notices from the Income Tax Department. Explore in-depth insights and reviews by visiting our Form 145/146 Filing Reviews.