The income tax department has enabled the registration of non-residents including foreign companies for online filing of Form No. 10F on its e-filing portal having no PAN in India.
Vide Notification No. 03/2022 dated 16.07.2022, the Director General of Income Tax (Systems), with the prior approval of CBDT, mandated the e-filing of various forms including Form No. 10F on the income tax e-Filing Portal with immediate effect.
This has caused practical difficulty for non-residents since PAN is required to create an e-filing account on the income-tax portal as this requirement makes it compulsory for every non-resident to obtain PAN in India for filing Form No. 10F even if such a non-resident is not legally required to obtain PAN in India. Several representations have been made to the Board for exempting non-residents from online e-filing of Form No. 10F.
Considering the difficulty and to mitigate the genuine hardship, the CBDT allowed manual filing of Form No. 10F till 31.03.2023 vide communication dated 12.12.2022. It was further extended to 30.09.2023 vide a communication dated 28.03.2023. Thus, the Board had granted exemption from mandatory e-filing of Form 10F to non-resident taxpayers who are not having PAN and are not required to obtain PAN under the extant provisions of the Income-tax Act, 1961 (‘Act’) till 30th September, 2023.
With effect from 1st October, 2023, the exemption so given from online filing of Form 10F and allowing them to manually file Form No. 10F is withdrawn, hence, it is mandatory to file Form 10F electronically.
In order to address the issue, the income-tax department has enabled non-residents who do not have a PAN to e-file Form 10F on the income tax portal by creating an account without the requirement of first obtaining a PAN.
In the ‘Registration’ form of the e-filing portal, an option of ‘Non-Residents not holding and not required to have PAN’ is given for registering the non-residents having no PAN in India and is not required to obtain PAN in India.
It is mentioned that taxpayers who have already registered on the portal once and have login credentials are not required to register themselves again.
The Tax Identification Number (TIN) and Tax Residency certificate (TRC) can be updated by the taxpayer through their My Profile post login to e-filing portal. although there is no official notification on this. A one-time password is required for registration and the user will have to provide their details as well as details of key persons in India.
Form No. 10F: Form No. 10F is an important document to claim the benefit of the Double Taxation Avoidance Agreement (DTAA or Tax Treaty). In order to claim the benefit of any DTAA in respect of any income earned in India, a non-resident payee is required to furnish certain details in Tax Residency Certificate (TRC) along with Form No. 10F, as per Section 90(5) of the Act read with Rule 21AB to the Indian payer at the time of withholding of taxes. The TRC must contain certain specified information such as non-resident’s status, nationality, tax identification number, period of residency, etc. If the specified information is not available or missing in the TRC, then Form No. 10F has to be furnished giving all such missing information in order to claim the benefits of DTAA.
Prior to 16.07.2022, such information in Form No. 10F was to be furnished in manual mode or in an offline manner. However, post 16.07.2022, this form has to be furnished online on the income tax e-Filing portal after logging into the e-filing account by the non-resident.
Now a non-resident (including a foreign company) who does not possess a PAN in India can now get himself register on the e-filing portal and can file Form 10F electronically. Earlier, registration on e-filing was not allowed without a PAN.
It is interesting to note that no official communication from the CBDT has been issued in this regard but the e-filing portal has enabled the feature for registration of a non-resident not having PAN in India for electronic filing of Form No. 10F. Indeed, it is a good measure of ease of compliance.
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