Are you worried about your TDS (Tax Deduction at Source) interest?
How can you make sure that your bank does not deduct TDS interest from the maturity amount of any of your investment?
The best way to do so is to submit the 15G and 15H form to your banker. This way you can request your income provider not to deduct TDS for the prescribed income. As per the prevailing income tax norms, banks need to deduct TDS for any interest income more than Rs 10,000 in a financial year (at the rate of 10 % on the interest amount). But in the cases when an individual’s income is below the taxable limit, he can submit Forms 15G and 15H to the bank. This way he can also save himself from the headache of claiming refunds.
What are Forms 15G and 15H of income tax?
As mentioned, both form 15G and 15H can be helpful for non-deduction of TDS on your income. Form 15H is a declaration under sub-section (1C) and the Form 15G is a declaration under sub-sections (1) and (1A) of section 197A of the Income Tax Act of 1961.
These forms are used only for payments associated with dividends, the interest of securities interest not associated with Securities (Company or Bank Deposits), NSS and Interest on Units. These forms are not to be used for any other payments. Usually, people fill form 15G during PF withdrawal if they do not want deduction of any tax from the payment due to them. Some banks have the provision for submitting these forms online, or else it can be forwarded to post office, company, EPFO, etc.
Pan card is essential for submitting these forms. 3 copies of such forms need to be submitted to the payer (which may be a bank, post office or a company). Both form 15G and 15H are for Indian citizens, HUF and AOP. While form 15G is for residents below 60 years of age, form 15H is for residents above the age of 60.
But you have to make sure that, if you are eligible, you have to submit these forms every year. Moreover, submitting these forms at the start of the financial year ensures that the bank will not deduct any TDS on your interest income.
What are the Conditions to fulfill for submission of forms 15G and form 15H?
Here are the conditions to submit form 15G–
- Firstly, you need to be a HUF (Hindu Undivided Family) or an individual
- You should not be more than 60 years of age.
- You need to be a resident of India.
- The tax calculated on your income should be NIL.
- Your total income should not be more than the specified basic exemption limit for that assessment year.
Here are the conditions to submit form 15G–
- Firstly, you have to be an individual
- You need to be a resident of India
- You should have turned 60 years or more or will turn 60 during the year in which you are submitting form 15G
- The tax calculated on your income should be NIL
What are the procedures for filling the Form 15G and Form 15H?
Online method-
Instead of submitting the forms at a bank branch, one can also fill the forms online. But before that, you have to contact your bank if it allows you to fill the form 15G or form 15H online through Net Banking.
How to fill 15G form and 15H form online (may vary for different banks)-
Step 1: You should have Net banking registered in your bank account. Log in to your account using your Net banking ID and password.
Step 2. Select the Tax Section displayed in the screen
Step 3. Click on Form 15G or form 15H that appears on selecting the Tax section
Step 4. Fill all the required details
Step 5. Click on ‘Submit’ after you are done with the filling of the necessary details
Step 6. Download the acknowledgment slip after submitting
Step 7. Save the Service Request number for your future reference.
Note– If you do not have Net Banking facility, you can visit your nearest bank for filling the forms. For offline submission, you should carry your PAN card along with you while visiting the bank. The other details will be provided to you by the bank.
How are you benefitted by submitting form 15G and form 15H?
Submission of forms 15G and 15H will help you in the following scenarios-
- TDS on withdrawal of EPF: If you happen to withdraw EPF before the expiry of 5 years of continuous service, TDS is liable to be deducted on the amount withdrawn. If in case, you have served for less than 5 years and plan to withdraw your EPF balance of more than Rs. 50,000, then you are eligible to submit form 15G or 15H. But before that, you have to be aware of all the conditions that are necessary to be fulfilled for submitting the forms.
- TDS on Insurance Commission: If you are an insurance agent, your TDS gets deducted on Insurance commission if it exceeds Rs. 15,000 in a particular financial year. However, with the effect from 1.6.2017, you can submit Form 15G or Form 15H and can claim no deduction of TDS if the taxable amount on your income is NIL.
- TDS on post office deposits: Nowadays, post offices are digitized, and most of them have the facilities for deducting or accepting Form 15G or Form 15H – provided you meet the applicable conditions to submit them.
- TDS on income from corporate bonds: On corporate bonds, your TDS is deducted only, if the income amount from them exceeds more than Rs. 5,000. So, in such cases, you can request for non-deduction of TDS by submitting Form 15G or Form 15H.
- TDS on rent: TDS is also deducted on your rental income, if it exceeds Rs. 1.8 lakhs on a given financial year. As applicable from June 1st, 2016, by submitting form 15G or form 15H, you can request the tenant for non-deduction of TDS if your total income is NIL.
Points to remember
- As per the Indian Law, if an individual has furnished any false information, he or she can be sentenced for 3 months of imprisonment.
- While submitting Form 15G or 15H, be sure that you collect the acknowledgment. In cases of any disputes or controversy, submission of acceptance with PAN details can be very useful.
- For an individual, the PAN card detail is essential to submit Form 15G or Form 15H. Without your PAN card details; no bank would not accept Form 15G and Form 15H.
Hope the explanations mentioned above will help you in filling forms 15G and 15H. For any query, feel free to call us at 0120-411-0376. We would be happy to assist you in the best possible manner.
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