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Foreign Remittance Compliance (Form 145 & 146) – Complete 2026 Guide

Understand the updated foreign remittance compliance rules in India for 2026, including when Form 145 and Form 146 are required and how to avoid common mistakes.

—·2 min read
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Foreign Remittance Compliance (Form 145 & 146) – Updated Guide for 2026

From 1 April 2026, India has introduced a revised framework for foreign remittance compliance. The earlier Forms 15CA and 15CB have been replaced with:

  • Form 145 – Remitter Declaration
  • Form 146 – Chartered Accountant (CA) Certificate

This new system is designed to improve accuracy, reduce unnecessary filings, and bring clarity to cross-border transactions.

What is Form 146?

Form 146 is a certification issued by a Chartered Accountant. It confirms:

  • Whether the remittance is taxable in India
  • Whether benefits under Double Taxation Avoidance Agreement (DTAA) are correctly applied
  • Whether the correct Tax Deducted at Source (TDS) has been calculated and deducted

This form is required only in specific situations and is not universally applicable.

When is Form 146 Required?

Form 146 is required only when all of the following conditions are satisfied:

  • The payment is made to a non-resident or foreign company
  • The remittance is taxable in India
  • The total remittance exceeds ₹5 lakh in a financial year (aggregate basis)
  • The remitter is required to file Form 145 under Part C
  • No Assessing Officer (AO) certificate or order has been obtained

When is Form 146 Not Required?

Form 146 is not needed in the following cases:

  • When an AO certificate is obtained, and the remitter uses Form 145 Part B
  • When the remittance is not taxable in India, in which case Form 145 Part D is used (subject to applicable exemptions)
  • When the remittance is taxable but does not exceed ₹5 lakh in the financial year, where Form 145 Part A applies

Understanding Form 145 Structure

Form 145 is divided into different parts depending on the nature and value of the remittance:

  • Part A applies when the remittance is taxable but does not exceed ₹5 lakh in a financial year
  • Part B is used when the remittance exceeds ₹5 lakh and an AO certificate has been obtained
  • Part C applies when the remittance exceeds ₹5 lakh and requires a CA certificate (Form 146)
  • Part D is used for remittances that are not taxable, subject to Rule 220 exemptions

Practical Compliance Process

To ensure smooth compliance, the following steps should be followed:

First, determine whether the remittance is taxable in India. Once taxability is established, identify the correct part of Form 145 applicable to the transaction.

If the case falls under Part C, the remitter must assign a Chartered Accountant through the portal. The CA will then review the transaction and file Form 146 using a digital signature.

After the CA submits Form 146, the remitter must file Form 145. Only after completing these steps should the remittance be processed through the bank.

Key Clarifications

There are several important points that are often misunderstood:

  • The ₹5 lakh limit is calculated on an annual aggregate basis, not per transaction
  • Form 146 is not required for all remittances above ₹5 lakh
  • Some non-taxable remittances may still require reporting under Part D
  • Certain transactions are fully exempt under Rule 220(3)
  • Compliance is event-based, meaning forms must be filed before each remittance
  • There is no fixed due date, but filing must be completed prior to making the payment

Who Should Be Concerned?

This framework impacts:

  • Businesses making payments to overseas vendors or service providers
  • Individuals remitting funds abroad in taxable scenarios
  • Chartered Accountants responsible for certification and verification

Conclusion

The revised system using Form 145 and Form 146 introduces a more structured and conditional approach to foreign remittance compliance in India. A key takeaway is that Form 146 is not mandatory for every transaction. It is required only when specific conditions are met, particularly in cases involving taxable remittances exceeding ₹5 lakh without an AO certificate.

Careful evaluation of each remittance, proper classification under Form 145, and timely filing are essential to ensure compliance and avoid delays. Engaging a qualified professional can help navigate these requirements efficiently under the updated 2026 rules.