Form 15G and Form 15H – Comprehensive Guide
What is Form 15G and Form 15H?
TDS is required to be deducted under section 194A at the rate of 10% on interest other than interest on securities. If PAN is not submitted then tax is to be deducted @ 20%. Therefore, banks are also required to deduct TDS on interest payable on deposits if the interest amount exceeds Rs. 10,000 in a financial year. The bank includes deposits held in all its branches to calculate this limit.
In order to relieve assesses who are not liable to income tax as their taxable income doesn’t exceed the basic exemption limit, form no. 15G and form no. 15H are introduced under section 197A and Rule 29C.
Form 15G or 15H can also be filed for TDS on EPF withdrawal, income form corporate bonds, post office deposits and insurance commission under section 194D. Form 15G/15H can also be filed for TDS on rent under section 194I from financial year 2016-17.
Difference between Form 15G and Form 15H
Can be submitted by resident individual or HUF
Can be submitted by person who is less than 60 years of age.
Can be submitted only when the tax on estimated income for the year is nil
Can be submitted only when amount of interest and other income from all sources doesn’t exceed the basic exemption limit which is Rs. 2,50,000 for financial year 2016-17 and 2017-18.
Can be submitted only by resident individual who is above 60 years of age or completes 60 years during the financial year. Can not be submitted by HUF.
Can be submitted only when the tax on estimated income for the year is nil.
Although Form 15H can be submitted when the total income from all sources exceeds the basic exemption limit which is Rs 3,00,000 for senior citizen and Rs. 5,00,000 for super senior citizen for financial year 2016-17 and 2017-18.
Examples to understand who can submit Form 15G and Form 15H
Income ofABCDAge20256567Salary1,70,00090,0001,80,0000Fixed Deposit interest income60,0002,60,00070,0003,40,000Total income before deductions2,30,0003,50,0002,50,0003,40,000Section 80C deductions 01,10,00001,00,000Taxable Income2,30,0002,40,0002,50,0002,40,000Minimum exempt income2,50,0002,50,0003,00,0003,00,000Eligible to submit Form 15GYesNoYesYesEligible to submit Form 15HNoNoNoNoExplanationForm 15G can be submitted as the taxable amount and income from all sources are less than Rs. 2,50,000Form 15G can not be submitted as the income from interest income is more than Rs. 2,50,000Form 15H can be submitted if age is more than 60 years and tax calculated on total income is nil.Form 15H can be submitted if age is more than 60 years and tax calculated on total income is nil. Form can be filed even if the amount of interest is more than basic exemption limit.
When to File Form 15G/15H?
These forms have a validity of one financial year. Therefore they are to be resubmitted in every financial years. Submitting them as soon as the financial year starts will ensure the bank does not deduct any TDS on your interest income.
What if TDS already deducted?
If the TDS has already been deducted before submitting of form, then the only way is to file the income tax return and claim such TDS in it. The person who has deducted tax has to provide you TDS certificate in Form 16A . Also note that interest on FD is credited to your account at end of each year and not at maturity. TDS deducted in a year is to be claimed in ITR of that year only. TDS claim can not be carried forward.
Download Form 15G / Form 15H in Pdf, fillable Pdf, Word or Excel Formats
Filled Sample Form
Form 15G – Sample Form
Form 15H – Sample Form
Submitting Form 15G/15H online
Now a person need not fill the form manually, online facility for filing form 15g/h is now available. You just need to login in to your net banking account, download the pre-filled form, take a printout and submit it in your bank after signing.
Penalty for Filing Form 15G/15H if you are not eligible
A false or wrong declaration in Form 15G/15H attracts penalty under Section 277 of the Income Tax Act. Prosecution includes imprisonment which may range from three months to two years along with fine. The term can be extended up to seven years and with fine, where tax sought to be evaded exceeds 25 lakh.
In case a person becomes ineligible afterwards
In a case where at the beginning of year you submit 15G/15H because you meets the specified criteria and afterwards you gets unexpected income and thus not fall within specified criteria then you needs to submit a 15G/15H withdrawal application and the bank has to deduct TDS on next payment to your account.
If you have submitted form 15G/15H, it doesn’t means that you don’t need to submit PAN to the deductor, if you will not submit PAN then TDS is to be deducted @ 20%.
Interest in calculated on accrual basis and not on payment or due basis.
It is advised to take a written acknowledgement of submitting such form to avoid inconvenience.
The payer of income is required to submit one copy of such forms to the Commissioner of Income tax on or before 7th of next month in which the form is submitted to him. Circular no. 351, dated 26th nov, 1982.