Earlier this year i received INR 35 lacs as gift from my elder brother and that money is currently in my NRO accout and i want to remitt that money outward to my foreign back account, will you be able to take me through the process and do the needful to complete this entire procedure. I will need you to help me with any letters that i need from a CA and make me aware of all documents that i need to provide to complete the stated transaction.
No letters are required to be submitted you just need to submit Form 15 CA and form 15 CB to remit money from NRO account to out of India.
If you need any assistance feel free to contact me.
Hope you find the information helpful if you do please rate it 5 and provide your valuable feedback for my improvement.
Thank you.
The answer to this query can be bifurcated into three parts:
1. Tax Aspects:
Gift received from your brother is exempt from tax and therefore, there won't be any tax liability on such gift.
However, any interest income earned on Rs. 35 Lakhs in the NRO account would be taxable and the Bank would deduct tax at source (TDS) on such income at either the slab rate in India (30% + surcharge + cess) or the rate as per the tax treaty (DTAA) between India and the country of residence of the recipient, whichever is more beneficial to the recepient. In the present case, the DTAA between India and USA prescribes a tax rate of 15% on such income. Hence, your Bank would deduct tax on the interest income at the rate of 15% (subject to submissions of requisite documents).
2. Process:
Below is the process of remittance of funds from the NRO account to your foreign bank account:
a) Request to the Bank in which you have NRO account to initiate transfer of funds (mode of request would be different for different banks)
b) Bank would ask for the following documents:
This is the general process followed by most of the banks. However, some banks may have additional requirements.
3. Certificate from CA (Form 15CB):
There is an increased obligation on CAs to ensure that the contents of the certificate are sacrosanct. Any mistake in the certificate results into penalty on the CA as well as penalties on the assessee for mis-reporting/under reporting of income. Thus, atleast the following documentary evidences would be required in order to furnish you this certificate:
Professional Fees: Rs. 18,000/- (inclusive of all taxes).
- Remittance by resident/non-resident to non-resident outside India attracts income tax and FEMA provisions. under Income tax, filing of Form 15 CA and 15CB is applicable. In your case, it is remittance to your own account which will not attract any tax deduction as the remittance is not towards any expense.
- There is no need of any letters. After filing of Form 15CA and 15CB, submit the hard copies to the authorised dealer i.e. your bank to process the remittance. for filing of 15CA and 15CB, CA needs some details from you.
since the source of money that i am planning to remit to my US bank account is the gift from my brother, ( i guess he is considered a relative) are there no documents required to establish the source of funds,
Yes you are correct. Please take phone consultation to discuss in length.
Hello,
In order to remit funds from the NRO account, you would need to submit two documents Form 15CA and Form 15CB. No letters would be required from a CA however CA's certificate is required under Form 15CB.
No TDS deduction is to be made since transfer it to your own account.
I hope that this answer satisfies your requirements.
Regards,
CA Hunny Badlani
Yes, your understanding is correct.
Hi,
Receipt of gift from brother is tax free as brother comes under the definition of relative.
You can transfer the money to your foreign bank account after submitting Form 15CA and 15 CB.
Form 15 CB is a certification from a chartered accountant giving details of the money being remitted. For issuing this certificate, chartered accountant will required certain documents such as (bank statements, confirmation from your brother on the gift amount, PAN card etc.)
You can take a phone consultation to understand it in detail.
As mentioned above, a signed letter from your brother and his & your bank account statement establishing the money trail would be required.
Form 15CA needs to be filled only if the remittance is chargeable to tax in India. If remittance/payment is not chargeable to NRI then Form 15CA is not required.
-No Form 15CA and 15CB will be required to be furnished by an individual for remittance which do not require RBI approval under its Liberalized Remmittace Scheme (LRS).
-The list of payments of specified nature under Rule 37 BB where submission of Forms 15CA and 15CB is not required has been expanded from 28 to 33.
-A CA certificate (Form No. 15CB in this case) will be required to be furnished only in case of payments made to non-residents which are chargeable to tax and the amount of payment during the year exceeds Rs. 5 lakhs.
We have handled such cases before. We may assist you in entire procedure.
Yes, your understanding is correct.
It's advisable to have a gift deed between you and your relative so that it is full proof that your income is exempt.