When an Indian company pays a non-resident and wants to apply a reduced tax rate under a Double Taxation Avoidance Agreement (DTAA), it must ensure that certain documents are in place. One of the key documents required is Form 10F, which captures details often missing in the Tax Residency Certificate (TRC) issued by the non-resident’s home country. While Form 10F could earlier be submitted manually in some cases, the Central Board of Direct Taxes (CBDT) has made e-filing of this form mandatory in most scenarios. This blog explains the full background, filing requirements, and consequences for Indian companies or residents who fail to comply.
E-filing of Form 10F (1/2)
Section 139A of the Income-tax Act, 1961 deals with who needs to obtain a Permanent Account Number (PAN). Rule 114AAB provides exemptions for certain classes of persons from this requirement.
Now, under Section 90(5) of the Act, if a non-resident wants to claim benefits under a DTAA, they must furnish prescribed information and documents. This is especially important when the TRC from their home country doesn’t include all the details Indian authorities expect.
To standardise this process, the CBDT issued Notification No. 3/2022 on 16 July 2022, mandating that Form 10F must be furnished electronically.
Here’s where it gets tricky:
To file Form 10F online, the non-resident must:
- Have an Indian PAN
- Be registered on the Indian income-tax e-filing portal
- Have a Digital Signature Certificate (DSC) to file the form
Recognising that not all non-residents have a PAN or are required to get one, the CBDT granted a temporary relaxation on 12 December 2022. Under this relief, non-residents who are not required to obtain a PAN could submit Form 10F manually until 31 March 2023.
But after that date, the relaxation ends—and electronic filing becomes the standard method for nearly all cases.
Form 10F includes several fields that may not always be present in the Tax Residency Certificate. According to Rule 21AB of the Income-tax Rules, 1962, if the TRC is missing any of these data points, the non-resident must file Form 10F.
Here’s what needs to be included:
- The status of the assessee (individual, company, firm, etc.)
- The nationality of the individual or the country of incorporation for others
- The Tax Identification Number (TIN) in the country of residence, or any other unique number used by that government to identify the person
- The applicable period for which the individual or entity claims to be a tax resident (as per the TRC)
- The address in the home country during the period covered by the TRC
These fields are essential because they directly relate to verifying the residency status of the taxpayer. The Indian Income-tax Department uses this information to determine if DTAA benefits can be legitimately claimed.
If the TRC already includes all of this information, Form 10F is not required. But if even one field is missing, filing Form 10F becomes mandatory.
In short, Form 10F acts as a complement to the TRC, helping fill any information gaps and ensuring treaty benefits are granted only to legitimate residents of the treaty partner country.
Way-forward
Now that the manual filing option has ended (after 31 March 2023), both domestic companies and Indian residents making payments to non-residents need to be more cautious than ever.
What does this mean for Indian payers?
If you’re paying a non-resident and applying DTAA benefits (like reduced tax withholding), you need to ensure that:
- The TRC is available and contains all required fields
- If not, a properly e-filed Form 10F is submitted by the non-resident
Otherwise, the Income-tax Department could deny treaty benefits, and your company might be forced to withhold tax at the higher domestic rate, potentially leading to:
- Disputes with vendors
- Extra financial liability
- Future litigation
Checklist for e-filing of Form 10F
Here’s what the non-resident vendor must have in place to file the form electronically:
- ✅ Permanent Account Number (PAN)
- ✅ Registration on the Indian income-tax e-filing portal
- ✅ Digital Signature Certificate (DSC) for the authorised signatory
- ✅ Tax Residency Certificate (TRC) from the tax authority of their country
(This must be attached to the Form 10F)
Without all four, e-filing isn’t possible—and treaty benefits may not be granted.
Whether TRC has all information prescribed in Rule 21AB?
The final step in determining whether Form 10F needs to be filed is a simple flow based on the TRC’s content.
Step 1: Does the TRC include all the following?
- Taxpayer’s legal status (individual, firm, etc.)
- Nationality or incorporation country
- Tax ID number (or equivalent)
- Period of residence covered
- Full address in the home country
Step 2: Based on that, follow this logic:
- ✅ If YES: Form 10F does not need to be filed
- ❌ If NO: Form 10F must be filed electronically
Timeline Recap
- Between 16 July 2022 and 31 March 2023:
Manual filing was allowed only if the non-resident was not required to obtain a PAN - After 31 March 2023:
E-filing is mandatory in nearly all cases, unless the TRC is fully complete
This step-by-step check is crucial for Indian companies and tax advisors handling cross-border payments. Missing this requirement can lead to high tax outflows or potential legal issues down the road.
Final thoughts:
Form 10F isn’t just another bureaucratic form — it’s a vital link in India’s tax compliance system for cross-border transactions. As treaty benefits often reduce the tax burden substantially, ensuring that all documentation is in place — especially now that e-filing is mandatory — has become a key compliance step.
Indian companies, accountants, and tax advisors must adapt to this shift. From obtaining PANs for vendors to assisting them with digital signatures, the responsibility lies with both parties to ensure this form is properly filed. Because when it’s not, the costs — in tax, time, and litigation — can be steep.
