The Income-tax Department has introduced Form No. 128, replacing the earlier Form 13 under the new Income-tax Act, 2025. According to reports from ABP Live, this procedural change is designed to make it easier for taxpayers to avoid excess tax deductions or collections during the financial year. Instead of waiting for refunds later, eligible individuals and businesses can now apply in advance for a lower or nil TDS or TCS rate. The form allows taxpayers to apply for a certificate that permits tax deduction or collection at a reduced rate or even zero under Sections 395(1) and 395(3) of the new law.
The Income Tax Department has replaced Forms 15CA and 15CB with Forms 145 and 146 for reporting foreign remittances in 2026. As reported by Mint, these new forms are mandatory for sending funds abroad to NRIs, foreign entities, or making taxable remittances such as royalty, consultancy fees, or service-related payments. Form 145 is a self-declaration capturing transaction details including payment nature, total amount, applicable TDS, and recipient/remitter details, while Form 146 is a certificate issued by a Chartered Accountant confirming whether the payment is taxable in India and providing updated TDS rates. These forms are required before international transfers are processed and are essential for regulatory compliance.
Form No. 128 is available to both residents and non-residents whose actual tax liability is expected to be lower than standard rates. As reported by ABP Live, the application process is entirely digital through the TRACES portal. Taxpayers need to log in, select Form No. 128, enter estimated income and tax liability, upload supporting documents, and complete e-verification. Offline submissions are not allowed and the application must be filed before the income is credited or paid. The form is optional and only required if the taxpayer wants to avoid an excess deduction.
According to the report, applicants must provide estimated income details, tax calculations, prior income data if returns were not filed, and information on exempt income. A valid PAN is mandatory for the application process. After submission, an Acknowledgement Receipt Number is generated to track the request. If approved, the certificate can be downloaded online, and taxpayers dealing with more than 100 payers can use Annexure-II to generate multiple child certificates. The form is processed within a few weeks and can significantly reduce TDS on properties from ₹7-8 lakh down to the tax genuinely due on real gains.
The new forms allow taxpayers to apply for certificates that permit tax deduction or collection at a reduced rate or even zero under Sections 395(1) and 395(3) of the new law. As reported by ABP Live, the form is optional and only required if the taxpayer wants to avoid an excess deduction. However, once tax is already deducted or collected, the request will not be considered, making timing critical for successful applications. For NRI property sellers, the form can reduce TDS on a ₹25 lakh property from approximately ₹7–8 lakh down to the tax genuinely due on actual capital gains after eligible deductions. Mint emphasizes that foreign remittances are closely tracked and monitored by tax authorities, making it crucial to complete proper documentation to avoid payment delays or compliance issues.
