If your income is not taxable and yet your payments are being subject to tax deduction at source (TDS) then you can now generate the Forms 15G and 15H online and request non-deduction. Goodbye, physical form filling!
With most banks increasing charges for cash transactions at branches and more than five transactions a month at ATMs, have you switched to the net-banking mode? Is the flurry of discounts on apparel, shoes and monthly grocery leading you to shop online? When everything is moving the e-way, the income tax department too is taking giant leaps in the digital space. After moving the notifications and their rectifications online, the Income Tax department has taken the most commonly used forms of 15G and 15H online.
These forms need to be submitted to entities such as merchants, banks, vendors or even landlords for non-deduction of tax deduction at source on certain incomes such as rentals, interest, payments and so on. Form 15G is to be used by resident individuals below 60 years, trusts and HUFs and Form 15H is to be used by resident senior citizens. Additionally, to use these forms, your taxable income should be Nil along with some other conditions to be fulfilled.
If you were finding it cumbersome to submit the form each year to every bank branch or every vendor that you worked with then you would heave a sigh of relief in the new format and the simplified procedure put in place by the Income Tax Department.
The self-declaration under Form 15G or 15H can now be submitted either in paper form or electronically. Once you submit the forms, the bank, landlord or the vendor, will not deduct tax. Instead, he will allot a Unique Identification Number (UIN). The Department would be laying down a specific procedure for the issuance of UIN, the details of which, along with the self-declaration need to be furnished by the deductor (bank, landlord, vendor, merchant etc) in their quarterly TDS statements. However, these forms will have to be maintained by the deductor for 7 years from the end of the financial year in which they receive these forms.
“The requirement of submitting the physical copy of Form 15G and 15H by the deductor to the income-tax authorities has been dispensed with,” states the notification S.O. No.2663(E) issued by the Central Board of Direct Taxes.
So, if you wish to claim non-deduction of TDS for your bank deposit interest, then you can generate the Form 15G or 15H through your internet banking account, by selecting the branch, where your deposit has been logged as the forms need to be submitted to each branch that you hold a deposit even if it is held with the same bank.
But you should never submit a false declaration under Form 15G and 15H. A stiff penalty of imprisonment for three months to seven years depending on the case is applicable if one is caught submitting the forms if they don’t meet the eligibility criteria. There are two conditions one needs to fulfill:
At the end of each financial year, you can submit the forms only if you meet these criteria during the previous financial year and estimate the current years’ income to meet the provisions as well. If you have to dig old forms submitted for clarification or litigation, you can always knock at the door of the deductor as the Income Tax Department has instructed those deducting taxes such as merchants, vendors, landlords and banks to preserve the Form 15G and 15H submitted to them for seven years.