A common mode of Investment amongst a majority of people is maintaining deposits with various banks in India. TDS is applicable and deducted by banks to Fixed Deposits and Recurring Deposits. Forms 15G/H, which needs to be submitted in order to ensure banks don’t deduct the TDS from the interest earned by the individual. This guide will explain two important Forms – form 15G /H and the eligibility to submit, their purpose and points to note while submission.
We all know that banks credit the Interest Income to the individuals towards their deposits. Form 15G and Form 15H are self-declaration forms that we need to submit every financial year, as per eligibility to the banks, requesting not to deduct Tax Deducted at Source (TDS) on the Interest Income. The depositor should have a PAN card to submit these forms.
Form 15H is for senior citizens who are 60 years or older and Form 15G is for those individuals who are less than 60 years of age.
TDS is applicable on interest paid or payable at a later stage when the amount is above Rs. 5000 or Rs. 10,000 yearly. So, the banks deduct the TDS annually and its vice versa when the interest income is less than the prescribed limit. The banks are required to deduct the TDS on Fixed Deposits or Recurring Deposits which exceed Rs. 10,000/- in total from all the branches of the bank, for the respective financial year . The interest is calculated on 31st March for the period and tax is deducted if the interest is more than Rs 10,000.
Along with the interest income there are other situations where an individual is expected to submit these forms like TDS on EPF withdrawal, TDS on Post-office deposits, TDS on Rent, TDS on Insurance Commission etc.
A resident individual or any person including HUF can submit Form 15G , provided the two conditions are satisfied as below.
An NRI or a partnership firm is not eligible to submit Form 15G/H.
A senior citizen can submit Form 15H and should satisfy the condition that the liability of tax on his/her total income must be NIL. Below is the table for reference:
|Individual Type||Form Type||Age||Exemption Limit|
|Individual||15G||Below 60 years||2,50,000|
|Senior Citizen (Individual)||15H||60-80 years||3,00,000|
|Super Senior Citizen (Individual)||15H||80 years above||5,00,000|
|Other than Individual (Trust, Association, HUF and Society)||15G||Not Applicable||2,50,000|
Use our Income Tax Calculator to calculate your tax liability
Here are the steps below to submit the Form 15G and Form 15H online to the Income Tax Department from your HDFC net banking account, for example.
**Note: The Fields in Form 15H, used for senior citizens, is similar to the fields in Form 15G.
Here is the process to fill the Form 15G/H in the relevant fields as below:
Part II needs to be filled by the person to whom you are submitting the declaration like the bank, post-office etc.
Attach the Pan Card copy along with the declaration. In case the TDS is already deducted, then you can still file your Income Tax Return and claim for the TDS refund depending on your tax liability.
Q. What is the time limit to submit Form 15G/H?
A. It’s advisable to submit in the beginning of the Financial Year or when any deposit is created at bank.
Q. Is the Interest Income not taxable upon submission of Form 15G/H?
A. Since the tax liability on total income is NIL, submission of these forms only means that no TDS should be deducted on the interest income. And However, the interest income is always taxable.
Q. What is required to submit Form 15G/H?
A. As per Bank records the valid PAN number along with Date of Birth must be updated by the individual.
Q. What Can You do if TDS is Deducted by Bank?
A. There is no option to get the TDS refunded back to you by the Bank or even if it gets deducted despite submitting the relevant forms. The only way to claim for refund is at the time of filing the Income Tax Return.
So, it’s always recommended to verify and submit the Form 15G/H as per the eligibility with valid PAN and Date of Birth details to the banks. For assistance with TDS refunds and/or the best tax saving and planning options available to you, enlist the aid of the tax experts at H&R Block India.