Rule 70: Form 36 author royalty certificate
Rule 70 prescribes the certificate for the section 151 deduction. Form No. 36 must be furnished along with the return and verified by the person responsible for making the payment to the assessee.
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Bare law
Rule 70 - Form of certificate to be furnished under section 151(5)
(1) For the purposes of claim of deduction under section 151, the assessee shall be required to furnish a certificate in Form No. 36 along with the return of income.
(2) The person responsible for making the payment to the assessee, shall verify the certificate in Form No. 36.
Rule breakdown
Check the section 151 deduction first
Section 151 governs qualifying author income and the relevant taxpayer, publication, amount and other conditions. Rule 70 addresses its certificate requirement.
Check the applicable tax regime and the actual income category before assuming that a royalty receipt is deductible.
Obtain Form 36 from the payment side
The prescribed certificate is Form No. 36, and the person responsible for making the payment must verify it. Identify the correct payer or responsible person.
A self-prepared summary of receipts is not the payer verification specified by the rule.
Reconcile the certificate to the income records
Match the certificate with the publishing or rights agreement, payment statements and amounts included in the return. Resolve discrepancies before furnishing it.
Retain the verified certificate and relevant supporting records with the deduction computation.
Check foreign-source documentation separately
The certificate is furnished along with the return under the rule. Where foreign-source income is involved, section 151(6) and Rule 72 impose a distinct prescribed-authority certificate requirement.
Do not assume that a payer-verified Form 36 automatically replaces the separate Form 38 requirement where that applies.
Key takeaways
Form 36
The section 151 certificate prescribed by Rule 70.
Payer verification
The person responsible for payment verifies it.
Foreign-source check
Separate statutory certification may also apply.
Practical checklist
- Identify the payer responsible for verification.
- Reconcile the certificate with agreements and receipts.
- Check any separate foreign-source certificate requirement.
Avoid
- Do not substitute an unverified personal schedule for the prescribed certificate.
- Do not assume the certificate alone proves deduction eligibility.
FAQs
Who verifies Form 36?
The person responsible for making the payment to the assessee.
Can the author’s own receipt schedule replace the verification?
The rule expressly calls for verification by the person responsible for payment.
Does Form 36 cover every foreign-source certificate requirement?
No. Check section 151(6) and Rule 72 separately where applicable.
Glossary
- Form 36
- The payer-verified certificate prescribed for the section 151 claim.
- Responsible payer
- The person responsible for making the payment to the assessee, who verifies the certificate.