Form 129 Income Tax Rules 2026 pdf download and Key points

Last Updated on: April 20, 2026

Form 129 Income Tax Rules 2026 pdf download and Key points

FORM NO. 129
[See rule 214]
Application by a person for a certificate under section 395(2) and 400(3) for determination of appropriate
proportion of sum (other than salary) payable to non-resident, chargeable to tax in case of the recipient.

Under the new Income-tax Rules, 2026, Form No. 129 replaces the old Form 15E. It is governed by Sections 395(2) and 400(3) of the Income-tax Act, 2025, and Rules 214 and 220 of the Income-tax Rules, 2026.

Here are all the key points regarding Form No. 129:

1. Purpose of the Form Form 129 is an application filed by a payer requesting the Assessing Officer (AO) to determine the appropriate taxable proportion of a payment (other than salary) being made to a non-resident or a foreign company. The purpose is to obtain a certificate from the AO authorizing the payer to deduct Tax Deducted at Source (TDS) at a lower or nil rate, often taking into account Double Taxation Avoidance Agreements (DTAA) so that excessive TDS is prevented.

2. Applicability (Who Should File)

Who can file: Any person responsible for paying a non-resident (not being a company) or a foreign company any sum chargeable under the Act (other than salary), or any person notified by the CBDT.
Is it mandatory? No, filing Form 129 is optional. However, it is strictly required if the payer wishes to deduct tax at a rate lower than the standard rates prescribed under the Act.

3. Frequency and Timelines

When to file: It is an event-based form. There is no specific time limit, but it must be filed before the remittance is made outside India.
Frequency: There is no limit to how many times it can be filed in a year; it can be filed for each remittance as needed.

4. Mode of Filing and Verification

Online Only: Form 129 must be filed electronically on the TRACES website (www.tdscpc.gov.in). It cannot be filed offline.
Verification: It must be e-verified using a Digital Signature Certificate (DSC), Electronic Verification Code (EVC), Aadhaar-based authentication, or Mobile OTP. Note that a DSC is mandatory for companies, LLPs, and other entities with a TAN-based login.

5. Structure of the Form The form is divided into distinct parts to capture the transaction and taxability details:

Part A (Particulars of Payer and Payee): Captures Name, PAN, TAN, Status, Residential Status, and contact details of both parties (including the payee’s TIN and country of residence).
Part B (Particulars of Transaction): Details of the remittance (nature, amount, proposed date), country of remittance, applicable tax year, and whether DTAA applies.
Part C (Taxability under the Act): Used if DTAA is not applicable. Requires the nature of payment (business income, royalty, capital gains, etc.), relevant section, taxable income, and required TDS rate.
Part D (Taxability under DTAA): Used if DTAA is applicable. Requires details of the Tax Residency Certificate (TRC), Form No. 41, relevant DTAA article, and required TDS rate.
Verification: A mandatory verification section signed by the applicant.

6. Mandatory Documents Required To successfully process the application, the payer must upload several supporting documents, including:

Relevant contracts or agreements (e.g., sale purchase, service agreements, share purchase agreements).
Details of the payee’s income for the preceding four tax years (if available).
Computation of estimated chargeable income and tax liability for the tax year.
Copy of the payee’s Tax Residency Certificate (TRC) and Form No. 41.
Detailed working notes on why the payment is not taxable or partially taxable in India, and notes on any business connection in India.

7. Withdrawal and Outcome

Withdrawal: An applicant can withdraw the application at any time before the AO passes an order.
Outcome: If the AO is satisfied, they will generate a certificate on the TRACES portal authorizing the lower or nil TDS rate. This certificate remains valid for the specified remittance, recipient, and tax year unless cancelled earlier. If rejected, the payer must deduct TDS at the normal rate as per Section 395(2).