Form 41 Filing for Non-Residents Under Income Tax Act 2025 : Claim DTAA Benefits
Form 41 is required to be filed by Foreign companies from 1 April 2026 onwards to confirm their tax residence status and claim lower tax rates under Indian DTAA’s. Failure to provide Form 41 results in higher TDS deduction ( 20 – 35%) on most income paid from India. We assist foreign companies from UAE, US, UK, Singapore , Europe and over 15 other countries to file Form 41 online .
What is Form 41 ?
Form 41 is a prescribed form filed by any overseas customer of an Indian company, to claim benefit of lower Indian Tax rates under an applicable DTAA.
Key facts about Form 41:
- Must be filed for Tax Year 2026-27 (income from 1 April 2026) and onwards
- Filed digitally on Indian Tax Government Portal
- Annual Filing
- Can be filed with a PAN (or without a PAN)
In respect of income due or received up to 31 March 2026 Form 10F is required to be filed.
Additionally, you can watch our 6 Shorts Video Youtube Playlist on Form 10F to get answers to your questions or CONTACT US NOW Now . (Click next on the Upper right Side to move to next videos one by one)
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Why Foreign companies Need to file Form 41
Non-resident are eligible to claim lower tax rates if they meet the following two conditions : –
Condition 1 — Tax Residency Certificate (TRC) – NR should have a Tax Residence certificate issued by the tax authority of the their country of residence .
Condition 2 — Provide other details as provided in Form 41.
If the foreign company does not meet both the conditions , the Indian payer is required to deduct TDS at the full domestic rate of 20% or higher on Fee for Technical Services, royalties and interest. The rate can be 35% if the foreign company earns business profits and has a Permanent Establishment in India.
For example, if a payment of USD 500,000 for technical services are made by an Indian company to a US company, the difference between the domestic TDS rate and the applicable DTAA rate can amount to USD 25,000 to USD 75,000 . Without Form 41 and a TRC, this excess TDS must be recovered through the Indian income tax return process — which typically takes 12 to 24 months.
India TDS Rate vs. DTAA Rate — Key Countries
| Country of Residence | TDS Without Form 41 + TRC | TDS With Form 41 + TRC (DTAA Rate) | Saving |
|---|---|---|---|
| USA | 20–25% + surcharge (domestic) | 15% FTS / Royalty (India-US DTAA) | Save 5–10%+ |
| UK | 20–25% + surcharge | 15% FTS / Royalty (India-UK DTAA) | Save 5–10%+ |
| UAE | 20% + surcharge | 10–12.5% FTS / Interest (India-UAE DTAA) | Save 7.5–10%+ |
| Singapore | 20% + surcharge | 10% FTS / Royalty (India-Singapore DTAA) | Save 5–10%+ |
| Germany | 20–25% + surcharge | 10% FTS / Royalty (India-Germany DTAA) | Save 10–15%+ |
| No Form 41 at all | TDS at maximum domestic rate | — | No saving possible |
Rates are illustrative. Actual rates depend on the applicable DTAA, income type and treaty conditions. Verify with your tax advisor. Form 41 applies to Tax Year 2026-27 (income from April 1, 2026 onwards) under the Income Tax Act 2025.
Get Expert Help with Form 41, PAN & No PE Certificate
What Information is Required in Form 41?
Form 41 has four parts. The following information is required:
Part A — Personal Details of the Non-Resident Taxpayer including a Foreign Company
Part B — Tax Residency Details including the Country of which the
Part C — DTAA between India and the country of residence , and the relevant Article for which the benefit is claimed
Part D — Verification
Documents to upload alongside Form 41 – A foreign company is required to provide certain documents including TRC, Certificate of Incorporation to file Form 41.
Filing Form 41 With PAN — Step by Step
Non-residents who hold a valid Indian Permanent Account Number (PAN) , can file Form 41 after logging into the Government of India Tax Filing portal.
Form 41 can be filed once all the relevant parts of the Form are completed and relevant documents for the period for which Form 41 is being filed are attached to the Form. Please note that a Single Form 41 covers all payments from all Indian payers of same nature.
Filing Form 41 Without PAN — What Non-Residents Need to Know
Form 41 can be filed without a PAN.
Non-residents who do not hold a valid Indian Permanent Account Number (PAN) , can also file Form 41 after logging into the Government of India Tax Filing portal.
Form 41 can be filed once all the relevant parts of the Form are completed and relevant documents for the period for which Form 41 is being filed are attached to the Form. Please note that a Single Form 41 covers all payments from all Indian payers of same nature.
While Form 41 can be filed without PAN, non-residents who regularly receive income from India, are advised to obtain a PAN. In case the tax are withheld in cases, where they are disputable, a non resident can file a Income Tax return to claim refund from Indian tax office. However, this is not possible if the Non resident does not have a PAN.
How we assist in Filing Form 41
We provide end-to-end assistance to file Form 41 . The complete process we have followed for filing Forms for 100+ customer is as under
Step 1 — Eligibility and DTAA Assessment
We review the nature of payment, and whether you are eligible to file Form 41 . We also provide you a list of documents you would require to file Form 41 and meeting your customer requirement.
Step 2 — Document Review
We review your TRC and other documents to confirm if they meet the requirements of Income Tax Act 2025 .
Step 3 — Portal Registration (if required)
We register you on Income Tax portal after obtaining and verifying relevant details.
Step 4 — Preparation and Filing
We prepare Form 41 based on your details and documents and file it on the Income Tax portal.
Step 5 — Delivery to Indian Payer:
We provide you with the Form 41 acknowledgement that you can share with your Indian customer.
Step 6 — Annual Renewal
The Form must be filed once per tax year. We remind you when renewal is due and handle the refiling each year.
Legal Framework — Form 41 and the Income Tax Act 2025
Section 159 of the Income Tax Act 2025 requires that a foreign company should provide a valid TRC and Form 41 for Tax Year 2026-27 (income earned from 1 April 2026) and subsequent years.
Relationship with No PE Declaration
The No PE Declaration is a practical requirement, wherein your Indian customer can give you DTAA benefit for lower/ Nil tax on business profits , FTS/royalty payments . The No PE Declaration is to be provided alongwith Form 41 and the TRC.
Real-World Examples: How Form 41 Reduces TDS for Foreign Companies
Example 1 — US Company, Software Licence Fees (Tax Year 2026-27):
XYZ Inc., a US software company, licenses IP to an Indian company for a recurring annual fee of USD 300,000. Under the Income Tax Act 2025, the Indian company is required to deduct TDS on this payment. Without Form 41 and a TRC, TDS is deducted at the domestic rate of 20%. XYZ Inc. filed Form 41 through Sorting Tax for Tax Year 2026-27 alongside its US TRC. The Indian company applied the India-US DTAA rate.
Example 2 — UAE Company, Management Services (Tax Year 2026-27):
ABC LLC, a UAE-based management consulting company, receives management service fees from its Indian subsidiary. The Indian subsidiary required Form 41 and a UAE TRC before applying the India-UAE DTAA rate. Sorting Tax filed Form 41 for Tax Year 2026-27 using the new Income Tax Act 2025 portal tab enabling the Indian subsidiary to apply the treaty rate from the first payment of the new tax year.
Conclusion
Form 41 is now mandatory for Tax Year 2026-27, and every foreign company or other non-resident receiving income from India by way of FTS, royalties, interest, dividends or business profits needs to file Form 41 to claim lower DTAA TDS rate.
Sorting Tax has been filing Form 10F for 100+ non-resident companies and has filed Form 41 for various clients since its introduction.
Contact us today using the details below or click the WhatsApp button to speak with our team.
FAQ — Form 41 Under Income Tax Act 2025
1. What is Form 41 under the Income Tax Act 2025?
Form 41 is a mandatory declaration filed by non-residents to claim DTAA benefits on Indian income. Effective April 1, 2026, it officially replaces Form 10F under the new Income Tax Act 2025.
2. When does Form 41 apply — and when does Form 10F still apply?
Form 41 applies to income received from April 1, 2026 onwards. Form 10F remains mandatory for all income received up to March 31, 2026, with both forms accessible via separate tabs on the e-filing portal.
3. What is the legal basis for Form 41?
Form 41 is legally mandated by Section 159(8) of the Income Tax Act 2025 and Rule 75 of the 2026 Rules. It requires non-residents to submit this form alongside a Tax Residency Certificate (TRC) to claim DTAA benefits.
4. Is Form 41 the same as Form 10F?
Form 41 serves the same purpose and requires similar information as Form 10F, acting as a self-declaration for DTAA benefits. The primary differences are the updated legal references under the Income Tax Act 2025 and its dedicated section on the e-filing portal.
5. Where do I file Form 41?
File Form 41 online via the incometax.gov.in portal under the ‘Forms as per Income Tax Act 2025’ tab. You must be registered on the portal using either a PAN or the non-resident non-PAN category.
6. Is PAN mandatory to file Form 41?
No, a PAN is not mandatory. Non-residents can register on the portal under the non-PAN category and file using OTP-based verification. However, obtaining a PAN is recommended to simplify compliance and avoid higher TDS rates under the Income Tax Act 2025.
7. Do I still need a Tax Residency Certificate (TRC) alongside Form 41?
Yes. Under Section 159(8), both a TRC and Form 41 are mandatory to claim DTAA benefits. Neither document is sufficient on its own, both must be filed and provided to the Indian payer.
8. Do I still need a No PE Declaration alongside Form 41?
Yes, in most cases. While not explicitly required by Section 159(8), a No PE Declaration is practically necessary to prove the absence of a Permanent Establishment. Indian payers typically require Form 41, a TRC, and a No PE Declaration together before granting DTAA benefits.
9. How often do I need to file Form 41?
Form 41 must be filed once per tax year (April 1 to March 31). A single filing per year covers all Indian customers for the same income type, so you do not need a separate form for each payer.
10. What happens if I do not file Form 41 for Tax Year 2026-27?
If you don’t file, the Indian payer will deduct tax at the higher domestic rate. To get that extra money back, you’ll have to file a tax return and wait 12 to 24 months for a refund.
11. What is a 'Tax Year' under the Income Tax Act 2025?
The 2025 Act simplifies things by replacing “Previous Year” and “Assessment Year” with one term: Tax Year.
Tax Year 2026-27 covers income earned from April 1, 2026, to March 31, 2027. All your tax filings and treaty claims for income earned during this period will now simply refer to this Tax Year.
12. I filed Form 10F for FY 2025-26 (AY 2026-27). Do I need to refile as Form 41?
No. For income received during FY 2025-26 (i.e. the period 1 April 2025 to 31 March 2026), the Income Tax Act 1961 and Form 10F continue to apply. You do not need to refile using Form 41. Form 41 is only for income received from 1 April 2026 (Tax Year 2026-27) onwards.
13. Does Form 41 apply to all types of income from India?
Yes. Form 41 applies to any income where a non-resident wants to claim DTAA benefits. This includes FTS, royalties, interest, dividends, software fees, and business profits. The specific tax rate will depend on the treaty between India and your home country.
14. Can Sorting Tax help file Form 41 under the Income Tax Act 2025?
Yes. Sorting Tax manages the entire process for you — from checking eligibility and reviewing your TRC to portal registration and filing. We provide a complete documentation package, including the No PE Declaration, and deliver the final acknowledgment directly to your Indian payer.
