What is Form 15G and Form 15H ?
Form 15G and Form 15H are self declaration forms that an individual submits to the bank requesting not to deduct TDS on interest income as their income is below the basic exemption limit.
FORM 15G
- Any Resident Individual(below 60 years of age) or any person(other than company or firm)
- Having interest income from FD below the basic exemption limits of Rs 2.5 lakhs and
- No final tax liability
- Having a valid PAN can submit the Form 15G
Form 15H
- Any resident Individual aged 60 years or above namely, Resident Senior Citizens
- Having any Interest Income. I.e. whether the interest earned is below basic exemption limit of 3 lakhs or not, you can still file Form 15H.
- But, The final tax liability should be NIL
- And Must have a valid PAN
Important Note
Form 15G and 15H are applicable only for ‘residents’, hence a non-resident cannot take the benefit of these forms.
When should you submit Form 15G and Form 15H?
Form 15G and Form 15H are valid for one financial year. So, please submit these forms every year at the beginning of the financial year. This will ensure that the bank does not deduct any TDS on your interest income.
Form 15G or Form 15H can be submitted for which transactions?
TDS Interest Income
- Banks have to deduct TDS when your interest income is more than Rs.40,000 in a year for individuals other than senior citizens (for senior citizens, the limit is Rs.50,000) under section 194A of the Income Tax Act. The bank aggregates the interest on deposits held in all its branches to calculate this limit..
- However, if your total income is below the taxable limit, you can submit Form 15G and 15H to the bank and request them not to deduct any TDS.
TDS on EPF withdrawal
- TDS is deducted on EPF balance if withdrawn before 5 years of continuous service.
- If you have had less than 5 years of service and plan to withdraw your EPF balance of more than Rs.50,000 , you can submit Form 15G or Form15H.
- However, you must fulfil conditions (listed above) to apply for these forms.It means the tax on your total income including EPF balance withdrawn should be nil.
TDS on income from corporate bonds
- If you hold corporate bonds, TDS is deducted on them if your income from them exceeds Rs 5,000.
- You can submit Form 15G or Form 15H to the issuer requesting non-deduction of TDS.
LIC premium receipts
- If the amount received from a policy exceeds Rs 1 lakh and if the maturity proceeds are taxable, 5% TDS shall be deducted by the insurer before paying.
- In case of failure to submit PAN details of the deductee to the LIC companies, TDS to be deducted at the rate of 20%.
- You can submit Form 15G/Form 15H to request that no TDS be deducted since tax on your total income is nil.
TDS on post office deposits
Post offices that are digitised also deduct TDS and accept Form 15G or Form 15H, if you meet the conditions applicable for submitting them.
TDS on rent
TDS is deducted on rent exceeding Rs 2.4 lakh annually. If tax on your total income is nil, you can submit Form 15G or Form 15H to request the tenant to not deduct TDS
TDS on Insurance Commission
TDS is deducted on insurance commission, if it exceeds Rs 15000 per financial year. However, insurance agents can submit Form 15G/Form 15H for non deduction of TDS if tax on their total income is nil.
TDS on Dividends
If the dividend income exceeds Rs.2,500 then TDS is required to be deducted.Form-15G/Form-15H can be submitted for non/lower deduction of TDS.
Examples Relating to Form 15G and Form 15H:
| Age | 55 Years | 25 years | 64 years | 68 years |
|---|---|---|---|---|
| Salary Income | 1,90,000 | - | ||
| Pension Income | - | - | 1,50,000 | |
| FD interest income | 95,000 | 2,80,000 | 1,40,000 | 3,50,000 |
| Total income before Section 80 deductions | 2,85,000 | 2,80,000 | 2,90,000 | 3,50,000 |
| Deductions under Section 80 | 50,000 | 40,000 | - | 70,000 |
| Taxable income | 2,35,000 | 2,40,000 | 2,90,000 | 2,80,000 |
| Basic Exempt income | 2,50,000 | 2,50,000 | 3,00,000 | 3,00,000 |
| Age Limit | Less than 60 years | Less than 60 years | More than 60 years | More than 60 years |
| Tax on total income | Nil | Nil | Nil | Nil |
| Interest income is less than basic exemption limit | Yes | No | Yes | Yes |
| Eligible to submit Form 15G/15H | Form 15G | Cannot Submit | Form 15H | Form 15H |
How to fill Form 15G?
- Name of Assessee (Declarant) – Enter your name as per income tax records & PAN number as per your PAN card,
- Status – Input whether you are an individual or HUF
- Previous Year –Input the current financial year for which you are filing up the form
- Residential Status – this form can only be filled by residents. Check your residential status here
- Fill in Address details along with PIN code, email, and telephone number.
- Whether assessed to tax under the income tax act, 1961? – If your income was above the taxable limit in any of the past 6 years, answer this question with ‘yes”.
- If yes, the latest assessment year for which assessed – mention the latest year in which your income was above the taxable limit.
- Estimated income for which declaration is made – fill sum of interest or other income on which TDS should not be deducted.
- Estimated total income of the previous year in which income mentioned in column 16 to be included – Calculate your total income from all sources, salary, stipend, interest income, any other income that you have earned during the year. Include the income mentioned in 16, above
- Details of Form 15G other than this form filed during the previous year, if any;- please mention the total number of Form 15G filed for that particular year.
- Also, fill the aggregate amount of income for which form 15G filed – Also provide the total income for which Form 15G was filed
- Fill details of income for which declaration is filed; Identification number of relevant investment/account etc, nature of income, Section under which tax is deductible, Amount of income – Provide fixed deposit account number, recurring deposit details, details of NSCs, life insurance policy number etc. (many of these are chargeable to tax under section 56 of the income tax act)
- Signatures – mention your capacity when signing on behalf of a HUF or AOP
