Form 15G and Form 15H

Form 15G and Form 15H

Form 15G and Form 15H are self-declaration forms issued by the Income Tax Department of India, allowing individuals to avoid Tax Deducted at Source (TDS) on specific types of income. By submitting these forms, eligible individuals can claim their total income is below the taxable limit, exempting them from TDS deductions on interest income and other specified sources. It’s essential to remember that both Form 15G and Form 15H are valid only for one financial year and must be submitted each year, provided the individual continues to meet the eligibility criteria. However, submitting these forms does not exempt individuals from paying taxes if their income exceeds the taxable threshold. They must still file their income tax returns (ITR) and pay applicable taxes accordingly. In this article, we will explore what is Form 15G and Form 15H, the step-by-step process of filling out these forms and more.

What is Form 15G and Form 15H?

Form 15G and Form 15H are self-declaration forms provided by the Income Tax Department of India that individuals can submit to banks or financial institutions to prevent the deduction of TDS (Tax Deducted at Source) on interest income. These forms benefit individuals whose total income is below the taxable limit and without tax liability for that financial year.

Form 15G is used by individuals below 60, Hindu Undivided Families (HUFs), and trusts. It helps them avoid TDS deductions if their total annual income falls below the basic exemption limit ₹2,50,000.

Form 15H is specifically for senior citizens aged 60 years and above. It prevents TDS deductions if their total annual income is below ₹3,00,000 for senior citizens and ₹5,00,000 for super senior citizens (aged 80 years and above).

By submitting these forms, individuals declare that their income is below the taxable threshold, and thus, they are not required to pay TDS on the interest income earned. It is important to note that submitting these forms does not exempt them from filing their Income Tax Returns (ITR) if their total income exceeds the basic exemption limit in a financial year.

Who Can File Form 15G and Form 15H & When?

Form 15G and Form 15H are valid for one financial year and should be submitted at the beginning of each financial year to avoid TDS deductions on your interest income by banks or financial institutions. This proactive approach ensures that no TDS is deducted if your total income is below the taxable limit.

Eligibility to File Form 15G:

• Can be submitted by any Resident Individual below 60 years of age, HUF, or trust (other than companies or firms).
• Applicable if the total interest income is below the basic exemption limit of ₹2.5 lakhs.
• The individual must not have any final tax liability for that financial year.
• A valid PAN is required to submit Form 15G.

Eligibility to File Form 15H:

• It can be submitted by any Resident Senior Citizen aged 60 years or above.
• Applicable for any interest income, irrespective of the amount.
• The final tax liability for the individual should be NIL.
• A valid PAN is mandatory for filing Form 15H.

By submitting these forms, eligible individuals can ensure that no TDS is deducted from their interest income, provided their total income falls below the applicable taxable limit.

Why Do You Need Form 15G and Form 15H?

Banks and public financial institutions periodically deduct TDS from the interest income from term deposits when crediting it to your account. However, suppose your total income is below the basic exemption limit, and you have no final tax liability for the financial year. In that case, you can prevent TDS deductions by submitting Form 15G or Form 15H. These forms allow individuals to declare that their income falls below the taxable limit, ensuring no TDS is deducted from their interest earnings.

Note: Banks and financial institutions deducted No TDS on interest earned from savings bank accounts.

Differences Between Form 15G and Form 15H

Although Form 15G and Form 15H are similar in purpose, their applicability and eligibility criteria differ. Here’s a comparison between the two:

Which Transactions Qualify for Submission of Form 15G or Form 15H?

Form 15G and Form 15H can be submitted to prevent TDS deductions on various types of income, provided the eligibility criteria are met. Here’s where these forms can be used:

Form 15G:

• Can be filed by resident individuals below 60 years of age during the financial year.
• Submitted when the individual expects to earn interest income exceeding ₹40,000 (₹50,000 for senior citizens) but still falls below the basic exemption limit.
• Used for transactions such as:
  • Interest on fixed deposits (FDs)
  • Interest on recurring deposits (RDs)
  • Interest on post office deposits
  • EPF withdrawals (if the service period is less than 5 years and income is below the taxable limit)
  • Rental income, if eligible for non-deduction of TDS

Form 15H:

• Exclusively for senior citizens aged 60 years or above.
• Used to claim exemption from TDS deductions on FDR (Fixed Deposit Receipt) interest income.
• It should be submitted at the beginning of every financial year to avoid TDS deductions.
• Applicable for:
  • Interest income from bank fixed deposits or recurring deposits
  • Interest on post office deposits
  • EPF withdrawals, if eligible
  • Income from corporate bonds and other eligible sources

By submitting these forms at the beginning of the financial year, eligible individuals can ensure no TDS is deducted from the specified income sources, making it easier to manage their tax liabilities.

Steps to Fill and Submit Form 15G

Following the steps below, you can successfully submit Form 15G to ensure no TDS is deducted on your PF withdrawal, provided your income falls below the taxable limit.

• Download the Form: Obtain Form 15G from the official EPFO website or any other reliable source.
• Fill in the Details: Enter all the required information carefully, such as your name, address, PAN number, and estimated annual income. Double-check the entered details to ensure there are no errors.
• Sign the Form: Sign the form in the presence of a witness. Make sure the signature matches your official records.
• Attach PAN Card Copy: Attach a self-attested copy of your PAN card along with Form 15G.
• Submit the Form: Submit the completed Form 15G and your PF withdrawal request to your EPFO office or bank, as applicable.
• Keep a Copy for Your Records: Retain a copy of the filled Form 15G for future reference and record-keeping.

How to Fill Form 15H: Step-by-Step Guide

Follow these instructions to accurately complete and submit Form 15H, ensuring no TDS is deducted from your interest income.

• Name of Assessee (Declarant): Enter your full name exactly as it appears on your PAN card. Include your PAN number accurately.
• Status: Select whether you are an Individual or belong to a Hindu Undivided Family (HUF).
• Previous Year: Mention the financial year for which the form is being submitted (e.g., 2023-24). This is the year in which the income is being earned.
• Residential Status: Confirm that you are an Indian Resident. Note that only Indian residents are eligible to submit Form 15H.
• Contact Details: Provide your full residential address, including street, city, state, and pin code. Include your active email address and contact numbers (telephone and mobile).
• Whether Assessed to Tax Under the Income Tax Act, 1961:Select Yes if your income has exceeded the taxable limit in any of the past 6 assessment years; otherwise, select No.
• If Yes, the Latest Assessment Year You Were Assessed: Specify the most recent assessment year in which your income was taxable (e.g., 2021-22).
• Estimated Income for Which Declaration is Made: Enter the total income (including interest income) for which TDS should not be deducted. Make sure to calculate all expected income sources accurately.
• Estimated Total Income of the Previous Year: Calculate and enter your total income from all sources, such as salary, stipend, interest income, rental income, or any other earnings for the financial year.
• Details of All Forms Filed Other Than Form 15H During the Previous Year: If you have filed any other forms (e.g., Form 15G) in the previous year, mention the number of forms submitted and the total income declared.
• Aggregate Amount of Income for Which Form 15H Was Filed: Specify the total income for which you submitted Form 15H during the previous year, if applicable.
• Details of Income for Which Declaration is Filed: Provide the identification number for relevant accounts or investments, the nature of income, and the section under which tax is deductible. Include details such as fixed deposit account numbers, recurring deposit details, NSC numbers, life insurance policy numbers, etc.
• Signature of the Declarant: Sign the form in your capacity, ensuring that the signature matches your official records.

Important Note:

• Do not submit Form 15 if the income needs to be clubbed with another person’s income (e.g., a minor’s income clubbed with a parent’s income).
• Retain a copy of the filled Form 15H for your records.

Purposes of Submitting Form 15G/15H

• Interest Income: To prevent banks and financial institutions from deducting TDS on interest earned from fixed deposits, recurring deposits, or any other interest-bearing accounts.
• Premature EPF Withdrawals: TDS is applicable on EPF withdrawals of ₹50,000 or more if the withdrawal is made within 5 years of account opening. Filing Form 15G/H can help avoid TDS, subject to eligibility criteria.
• Rental Income: If annual rental income exceeds ₹2,40,000, TDS is required to be deducted. Submitting Form 15G or Form 15H, as applicable, can help avoid this deduction if conditions are met.
• Insurance Commission: Insurance agents earning a commission of more than ₹15,000 are liable for TDS deductions. They can submit Form 15G/H to prevent TDS deductions if eligible.
• Income from Corporate Bonds: For income exceeding ₹5,000 from corporate bonds, TDS is deducted. Filing Form 15G or Form 15H can request non-deduction of TDS by the issuer.
• Post Office Deposits: Post offices with digitized systems may deduct TDS on deposit interest. Form 15G or Form 15H can be submitted to avoid TDS deductions on such deposits.
• Dividend Income: If dividend income exceeds ₹5,000 in a financial year, TDS is applicable. Filing Form 15G or Form 15H can request an exemption or a lower deduction of TDS.
• Proceeds from Life Insurance Policies: If life insurance policy proceeds, not exempt under Section 10(10D), exceed ₹1,00,000, TDS is deducted at 5%. Submitting Form 15G or Form 15H can help reduce or avoid TDS deduction on such payouts.

Can Form 15G / 15H be Submitted Even if Your Total Income Exceeds the Tax Exemption Level?

Form 15G and Form 15H cannot be submitted if your total interest income for the financial year exceeds the basic exemption limit. According to the Income Tax Act, these forms are meant for individuals who estimate their total income to be zero after accounting for deductions and allowances. Therefore, if your estimated total income exceeds the exemption threshold, filing Form 15G or Form 15H would not be applicable.

What Information is Required to be Furnished in Form 15G and Form 15H?

When filling out Form 15G and Form 15H, you will need to provide several key pieces of information. These forms are designed to help individuals claim exemption from TDS on their interest income. The required information is divided into two parts:

Information Required from the Individual (Declarant):

• Name: Full name of the taxpayer or individual.
• Address: Current residential address, including state and pin code.
• Communication Details: Email address and contact numbers (telephone and mobile).
• PAN Number: Permanent Account Number as per your PAN card.
• Residential Status: Confirmation of being an Indian resident.
• Previous Year: Financial year for which the form is being submitted.
• Estimated Income: Total estimated income for the financial year, including interest income.
• Declaration: A declaration stating that your income is below the taxable limit.

Information Required from the Authority:

• Verification: The authority to whom you submit the form will verify the information provided and sign off on it.

Steps to Submit Form 15G/15H with Different Banks

You can conveniently submit Form 15G or Form 15H from the comfort of your home or office. Follow these steps to submit your forms:

Internet Banking:

• Log in to your bank’s Internet banking portal.
• Navigate to the “Tax Services” or “Forms” section.
• Select the option to submit Form 15G or Form 15H.
• Fill in the required details and upload any necessary documents.
• Submit the form and keep a confirmation for your records.

Mobile Banking App:

Open your bank’s mobile banking application.

• Locate the option for “Tax Services” or “Forms.”
• Choose to submit Form 15G or Form 15H.
• Complete the form and submit it electronically.
• Save the confirmation for future reference.

By submitting Form 15G or Form 15H through these digital platforms, you can effectively save on Tax Deducted at Source (TDS) on your term-deposit interest income.

How to File Form 15G and 15H Online?

To file Forms 15G and 15H online, the deductors (usually banks) must use the income tax e-filing website. It’s important that the deductor has a valid Tax Deduction and Collection Account Number (TAN) and is registered as a Tax Deductor & Collector on the e-filing platform.

Registration

If the deductor is not yet registered, they must register as a Tax Deductor & Collector on the income tax e-filing website before proceeding.

Preparation Process

• Each entity that files Form 15G or Form 15 is assigned a Unique Identification Number (UIN) by the tax deductor. This UIN is necessary for filing quarterly statements of these forms.
• Forms 15G and 15H should be retained for a minimum of seven years.
• The UIN consists of three fields: sequence number, financial year, and TAN of the payer/deductor. Ensure that the paper declaration bears the same sequence number as mentioned in the UIN.

Filing Process

• Upload Forms: The payer must upload Form 15G and Form 15H, which are received quarterly on the e-filing website.
• Quote Sequence Number: The payer should include the sequence number (Field ‘a’ of UIN) in the quarterly TDS statement for transactions covered by Form 15G and Form 15H, even if no TDS has been deducted.
• Visit the Income Tax E-Filing Website: Navigate to the official income tax e-filing portal.
• Initiate Filing: Click on ‘e-file’ and select ‘Prepare & Submit Online Form (Other than ITR)’.
• Prepare XML File: Generate the XML zip file by clicking on FORM 15G/FORM 15H (Consolidated).
• Digital Signature Certificate (DSC): Ensure you have a valid DSC to file Form 15G/15H.
• Generate Signature: Use the utility provided to create a signature for the zip file.
• Login with TAN: Use your TAN to log in at incometaxindia.gov.in.
• Submit Form 15G/15H: Go to e-File -> Submit Form 15G/15H
  • Select the Form Name (Form 15G or Form 15H), Financial Year, Quarter, and Filing Type. Then click ‘Validate’.
• Attach Files: Browse for the ZIP and Signature files and attach them. These files are generated from the DSC utility.
• Upload: Click the Upload button. A success message will appear on the screen after a successful upload.

By following these steps, you can efficiently file Form 15G and Form 15H online, ensuring compliance with tax regulations.

What to Do If You Forget to Submit Form 15G/15H

If you forget to submit the form and your bank has already deducted TDS, don’t worry—there are steps you can take to rectify the situation:

• File Your Income Tax Return: The first step is to file your income tax return (ITR). This will allow you to claim a refund for any excess TDS deducted. Remember, the income tax department is responsible for processing your refund, not the banks or deductors. You can file your ITR quickly and easily with services like Tax2win.
• Submit Form Immediately: Even if you missed the deadline, submit the relevant form as soon as possible to prevent further TDS deductions for the remaining financial year. This proactive measure can help you avoid additional deductions moving forward.
• Provide Necessary Details: When filing your income tax return, include all relevant details, such as the TDS amount deducted by the bank. Accurate information will help the income tax department process your refund more efficiently.
• Keep Supporting Documents: Maintain a record of all supporting documents, including the submitted forms and proof of TDS deductions. These documents will serve as substantial evidence during the income tax assessment process.
• Seek Professional Assistance if Needed: If you’re unsure about the filing process or require assistance, consider consulting a tax professional. They can guide the necessary steps and ensure compliance with tax regulations. For personalized support, contact the experts at IndiaFilings, who can help you navigate the tax filing process effectively.

By taking these steps, you can address the oversight and ensure you are not penalized by TDS deductions.

Download Form 15g and 15h

• Download Form 15G: Click here to download Form 15G.
• Download Form 15H: Click here to download Form 15H.

Also, read NRI Taxation in India