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Form 15G and Form 15H are self-declaration forms provided by the Income Tax Department in India. These forms are used to declare that an individual's income is below the taxable limit, thereby seeking exemption from tax deduction at source (TDS) on certain types of income. It's important to note that both Form 15G and Form 15H are valid for one financial year and need to be filed every year if the individual continues to meet the eligibility criteria.
Submitting these forms does not absolve the individual from paying taxes if their total income exceeds the exemption limit. They are required to file their income tax returns (ITR) and pay taxes accordingly.
Let us discuss in detail what Form 15G and Form 15H are. Who can submit these forms? How to submit them, and the precautions to be taken while filing these forms.
Form 15G and 15H are self-declaration forms to be filed and submitted by individuals to ensure that the banks or financial institutions do not deduct TDS on the interest income earned/accrued in a financial year as their estimated total income will be below the basic exemption limit (i.e., ₹2,50,000 or ₹3,00,000 or ₹5,00,000, as applicable) and there is no tax liability in that particular year
In case of non-senior citizens, interest income also should be below the basic exemption limit to fill the Form 15G despite no tax liability on the total estimated income.
As per the provision of the Income Tax Act, financial institutions and other organizations must deduct TDS while crediting interest income to the account of the person, and the amount exceeds INR 40,000 and INR 50,000 in the case of senior citizens. Normally, people have a myth that interest on fixed deposits is calculated at maturity. Instead, it is calculated, and TDS on interest on the same is deducted periodically, which reflects in your Form 26AS.
Form 15G and Form 15H are valid for one financial year. Ensure you submit these forms every year at the beginning of the financial year. This way, you can avoid the TDS deduction by the bank or any institution that is liable to deduct TDS from your interest income.
Forms can be submitted by -
Banks or public financial institutions, while crediting in your account periodic interest, deduct TDS on term deposits interest income.One can avoid deduction of TDS on such interest income if his/her total income is below basic exemption limit and there is no final tax liability in that particular financial year.
Note: Banks and financial institutions deduct no TDS on saving bank accounts.
You might be tangled between the applicability and effectiveness of both of these forms. Both forms are similar yet distinguished in the following ways
| Form 15G | Form 15H | |
|---|---|---|
| Applicable on | Form 15G can be submitted by any person (other than a company or firm) | Form 15H can be submitted only by resident Individuals |
| Age Limit | Applies to residents below 60 years of age | This applies to resident senior citizens ( aged 60 years and above ) |
| Interest Income shall fall below the basic exemption limit | Interest income shall be below the basic exemption limit and not chargeable to tax | Interest income may or may not be below the basic exemption limit and not chargeable to tax |
| Provision under the Income Tax Act | As per Section 197A (1) and (1A) | As per Section 197A (1C) |
Let's understand the insights about Form 15G and Form 15H more transparently with the help of examples below
| Mr. Aditya | Mr Shekhar | Mrs. Bhalla | |
|---|---|---|---|
| Aged | 45 | 55 | 65 |
| Salary Income | 2,00,000 | 1,00,000 | 1,00,000 |
| Income from Interest on various Fixed deposits | 60,000 | 2,80,000 | 2,70,000 |
| Gross Total Income | 2,60,000 | 3,80,000 | 3,70,000 |
| Deductions under chapter-VI-A like u/s 80C etc | 1,20,000 | 1,50,000 | 150000 |
| Taxable income after Chapter VI -A deductions | 1,40,000 | 2,30,000 | 220000 |
| Basic exemption Limit | 2,50,000 | 2,50,000 | 3,00,000 |
| Net taxable income i.e Taxable Income | NIL | NIL | NIL |
| Applicability of Form 15G | YES | NO | NO |
| Reasons |
Form 15G is applicable because a. Mr. Aditya is not a senior citizen b. He Has interest income below the taxable limit c. His final Tax Liability is NIL |
Form 15G is NOT applicable because Although his tax liability is NIL, interest income exceeds the basic exemption limit. |
Form 15G is NOT applicable because Mrs Bhalla is a senior citizen, and in this case, Form 15H shall apply |
| Mr Sharma | Mr Verma | Mrs Chopra | |
|---|---|---|---|
| Aged | 65 | 75 | 55 |
| Salary/ Pension Income | 1,50,000 | 1,00,000 | 2,00,000 |
| Income from Interest on various Fixed deposits | 2,80,000 | 3,20,000 | 1,20,000 |
| Gross Total Income | 4,30,000 | 4,20,000 | 3,20,000 |
| Deductions under chapter-VI-A like u/s 80C etc | 1,50,000 | 1,50,000 | 1,50,000 |
| Taxable income after Chapter VI -A deductions | 2,80,000 | 2,70,000 | 1,70,000 |
| Basic exemption Limit | 3,00,000 | 3,00,000 | 2,50,000 |
| Net taxable income i.e Taxable Income - Basic Exemption Limit | NIL | NIL | NIL |
| Applicability of Form 15H | YES | YES | NO |
| Reasons |
Form 15H is applicable because a. Mr Verma is a senior citizen b. His final tax liability is NIL |
Form 15H is applicable because a. Mr. Sharma is a senior citizen, b. His final tax liability is NIL |
Form 15H is NOT applicable because Mrs Chopra is NOT a senior citizen, and in this case, Form 15G shall apply |
Note: For Form 15H, we need not check whether the interest income falls below the threshold limit ( maximum amount not chargeable to tax) or not.
Form 15G:
Form 15 G is filled by resident individuals whose age is below 60 years during the financial year as mentioned in Form 15G is submitted when an individual expects to earn interest income exceeding ₹40,000 and, for senior citizens, ₹50,000 during that financial year and wants to request exemption from TDS on that income.
Form 15H
Form 15H is submitted solely for senior citizens, i.e., individuals who are at least 60 years of age. Eligible individuals wanting to claim exemption from TDS deductions on FDR interest income. Individual Senior citizens need to submit it every financial year to avoid a TDS deduction
To fill Form 15G for PF (Provident Fund) withdrawal in India, follow these steps:
Remember to keep a copy of the filled Form 15G for your records.
Interest Income - To prevent banks and financial institutions from deducting TDS on interest income.
Premature EPF Withdrawals - Any amount withdrawn, ₹50,000 or more, within 5 years from the account's opening is liable for TDS. However, compliance can be avoided by furnishing Form 15G/H subject to fulfillment of conditions.
On Rental income - If rental income is more than Rs 2,40,000/- during the year and resultantly tax is deductible, you may file Form 15G or Form 15H as per the applicability.
Insurance Commission - Any insurance agent earning a commission exceeding Rs 15,000 is liable to TDS and can validly file these forms
Income from corporate bonds - TDS is deducted on income from corporate bonds exceeding Rs 5,000. Form 15G or Form 15H can be submitted to the issuer requesting for non-deduction of such TDS amount.
Post office deposits – Digitalised post offices also deduct TDS based on specified conditions. Form 15G or Form 15H can be submitted requesting for non-deduction of any TDS amount applicable.
Dividends - If the dividend income exceeds Rs. 5000, then TDS is required to be deducted.Form-15G/Form-15H can be submitted for non/lower deduction of TDS.
Proceeds of life insurance policy - If such proceeds other than those u/s 10(10D) exceed ₹1,00,000 in an FY, then the payer is required to deduct TDS @ 5%. The taxpayer can file Form-15G/Form 15H, as applicable, to avoid or for a lower deduction of TDS.
Some precautions, if taken during the complete process, will ease things. An illustrative list of such precautions could be drawn as follows
Form-15G/15H can not be submitted if the total interest income for the year exceeds the basic exemption limit. The Income Tax Act states that Form 15G/15H can be issued to those who estimate their total income on which tax is zero and total income comes after considering deductions and allowances.
Steps to submit Form 15G/15H with different banks
Form 15G/H can easily be submitted from the comfort of your home or office. Submit your Form 15G/H through Internet Banking or the Mobile app and save Tax Deducted at Source (TDS) on term-deposit interest.
ICICI Bank
ICICI prescribes the following steps for online furnishing of Form 15G/ 15H
Or
The other option to file Form 15G / H to ICICI bank is through the Insta Banking Kiosk:
Or
The other option to file Form 15G / H to ICICI bank is through the imobile App, also
SBI Bank
HDFC Bank
Deductors (i.e., banks) need to file Forms 15G & 15H on the income tax e-filing website. In addition, the deductor should have a valid TAN and register themselves as Tax Deductor & Collector on the income tax e-filing website to start the process.
If the deductor is not registered, they should first register as Tax Deductor & Collector to proceed.
Preparation Process
Everyone who files a Form 15G or Form 15H is assigned a Unique Identification Number, or UIN, by the tax deductor. The UIN is required to file quarterly statements of Form 15G and Form 15H. Forms 15G and 15H should be maintained for at least seven years.
UIN includes 3 fields - Sequence number, financial year, and TAN of the payer/deductor. The payer should digitize the paper declaration bearing the same sequence number mentioned in the UIN.
Filing Process
If you have forgotten to submit Form 15G or Form 15H and the bank has already deducted TDS, here are some steps you can take to rectify the situation:
Form 15G and Form 15H Sample Download
Download Form 15G
Download Form 15H
Some basic information, like the Name of the taxpayer/individual, address, communication details, estimated income, etc., together with verification and a declaration, shall be signed and submitted. The forms are divided into two parts, as shown below. The first part needs to be filled out by you, and the second one needs to be filled by the authority to whom you submit the respective form. Both of these forms seem to be identical, but there is an important difference between the two. Form 15H has an additional column for Date of Birth to keep track of; apparently, you can furnish this form only if you are 60 years of age or older. For more details, see the specimen copies of both forms attached below.
No NRI cannot submit these forms.
Any wrong declarations made shall attract prosecution and fine under section 277 of the Income Tax Act 1961. In case the tax sought to be evaded
You can file these forms only if your total tax liability is NIL and all other eligibility conditions as specified above are successfully met.
No, the forms are no alternate to filing your Income Tax Return. Even if you have made the disclosure about your income in these forms, you need to comply with the filing requirements of the IT return separately.
In case, after filing form 15G/H, your tax liability does not come to zero, then you have to pay the taxes. Moreover, this may amount to a wrong or false declaration and can attract repercussions, as mentioned above, u/s 277. So be very vigilant before filing these forms.
No, Actually, they are submitted to the authority from which you will receive income, and on such income, the respective authority is liable to deduct the TDS. No separate compliances are required to be undertaken on your part.
Yes, it will be better if any income accrues to you that can be tax deductible; then, you need to submit the forms to every branch of the organization from where such income is due. Also, you can ask this from the respective bank/branch.
Anyone not submitting PAN shall attract TDS @20%.
No, even in cases where the bank has deducted your tax after duly filing Form 15G/H, you cannot demand a refund from the bank. The only route open is to file your Income Tax Return and claim refunds.
It is suggested that you file your form at the beginning of the financial year to avoid a situation where the bank has already deducted your taxes.
It is suggestive to obtain the same. It helps to lessen the cases of wrong declaration claims made by banks. Also, you get valid proof in hand in case TDS is deducted or wrong deducted.
There are no harsh consequences to it. You will now be required to file an income tax return to validly claim a TDS refund.
Form 15G can be submitted by both. But form 15H can only be submitted by Resident Individual.
If Form 15G is not submitted, then the deductor will deduct TDS even if the deductee's income is not taxable.
There is no provision for any limit. It is submitted when the total interest Income of the assessee is below the basic exemption limit. There is zero tax liability..
Total income as per Form 15G is income estimation on which no tax is required to be paid.
No, interest income on FD/RD is taxable. However, if the tax on total income is nil, then the assessee can submit Form 15G/Form 15H
No, Only an assessee whose tax liability is nil and subject to other conditions is eligible to submit form 15G / Form 15H
