Form 15G and Form 15H are a declaration statements that can be filled out by fixed deposit holders to ensure that no TDS is deducted from their interest income in a year.
As per the income tax rules, it’s mandatory for banks to deduct tax at source (TDS) in case the interest earned on your fixed deposit, recurring deposit, etc. It is more than Rs. 10,000 in a financial year (before the Financial year 2019-20). Recently, EPFO Unified portal launched a facility to submit EPF Form 15G for the EPF registration which allows the EPF members to withdraw PF online.
In the Interim Budget 2019, this TDS threshold has been increased to Rs. 40,000, effective from FY 2019-2020.
The process to download Form 15G
Form 15G for TDS deduction can be downloaded from the Income Tax Department website.
Conditions to be satisfied for submitting Form 15G
The following conditions must be met for the successful submission of Form 15G.
- Must be an individual, Hindu Undivided Family (HUF) or Trust, but not a company or a firm.
- Must be a resident of India.
- Should be less than 60 years of age.
- The Assessee Income tax calculated should be nil.
- The total interest income for the year is less than the basic exemption limit of that year
Types of sources of income for which Form 15G/15H can be submitted :
- TDS on interest income from Bank Deposits
- TDS on Employee’s Provident Fund Withdrawal (detail provided below )
- TDS on income from debentures and corporate bonds:
Income earned from the corporate bonds exceeding Rs 5000 for a financial year is subjected to tax deduction at source. In such cases, if you are eligible to submit Form 15G, you can do so and request the issuer of bonds not to deduct TDS.
- TDS on interest from post office deposits:
- TDS on proceeds from Life Insurance Policy
According to the provision of Section 194DA of the Income Tax Act, 1961, if the maturity proceeds from Life Insurance Policy is above Rs 1 Lakh, in that case, proceeds are subjected to tax deductions at source. If all the conditions which are mentioned in Form 15G are satisfied then in that case, the taxpayer can submit Form 15G to the life insurance company to avoid any TDS deduction.
- TDS on Rental income
If your rental income for the financial year is above 8 Lakh, such income is subjected to tax deductions at source. However, if the taxable income is lower than the basic exemption limit, then you can submit Form 15G for non-deduction of TDS.
Form 15G Related to TDS on EPF Withdrawal Rules
According to section 192A of the Finance Act, 2015, EPF withdrawal will attract TDS (Tax Deducted at Source) if
- the amount of withdrawal is more than Rs.50 000, and
- period/job tenure is less than 5 years.
Note :
- TDS is deducted at 10% if an employee submits the PAN Card (But 15G form for EPF/15H is not submitted).
- TDS will be deducted at the rate of 34.608% if an employee fails to submit the PAN Card. (Also Form 15G/15H is not submitted).
TDS is not applicable in the following cases related to EPF :
- Transfers of their EPF account to another account.
- Termination of service happened due to ill-health of the employee, discontinuation of business by an employer, completion of a project or other cause beyond the control of an employee.
- If an employee withdraws the EPF amount after a total of 5 years of service (Including the service with a former employer).
- If the EPF amount is less than Rs.50 000, but the employee has rendered service for less than 5 years,
- In case the employee withdraws more than or equal to Rs.50 000, with the employment of fewer than 5 years, but submits Form 15G/15H along with a PAN Card.
Filling of Form 15G:
Form 15G has two sections.
The first part is meant for individuals who want to claim no deduction of TDS on certain incomes. The following are the details to be filed,
(1) Name of the Assessee (Declarant) – Name as mentioned on your PAN Card
(2) PAN of the Assessee: A valid PAN card is mandatory to file Form 15G
(3) Status: Income tax status, which can be Individual/ Hindu Undivided Family(HUF)/ AOP, whatever is applicable.
(4) Previous Year: the financial year for which claiming the non-deduction of TDS is to be done
(5) Residential Status: Residential status of an individual because NRI is not allowed to submit Form 15G.
(6-12) Address: Communication address along with PIN code.
(13-14) Email ID and phone number: valid email ID and contact number for further communications.
15 (a) Whether assessed to tax under the Income-tax Act, 1961: Tick ‘’Yes’’ if assessed to tax under the provisions of Income Tax Act, 1961 for any of the previous assessment years.
(b) If yes, the latest assessment year for which assessed: the latest assessment year for which the returns were assessed.
(16) Estimated income for which this declaration is made: In this field, the estimated income for making the declaration needs to be mentioned
(17) Estimated total income of the P.Y. in which income mentioned in column 16 to be included: Total estimated income for the financial year (which includes all the income)
(18) Details of Form No. 15G other than this form filed during the previous year, if any: If there any, already filed Form 15G anytime during the financial year, then the details of the previous declaration along with an aggregate amount of income need to be mentioned in the present declaration.
(19) Details of income for which the declaration is filed: The last part of section 1 asks to fill in the investment details for which you are filing the declaration.
There’s a second part of the form too, to be filled out by the deductor, i.e. the person who is going to deposit the tax deducted at source to the government on behalf of the tax assessee.
False declaration :
Providing a false declaration in Form 15G just for the purpose of avoiding TDS can lead to a fine and even imprisonment under Section 277 of the Income Tax Act, 1961
Form 15H:
- The applicant must be a senior citizen who would have turned 60 years of age by the end of the FY of submission.
- They must be an individual and not a firm, HUF or company.
iii. They must be a resident of India.
- Their total taxable income must fall below the taxable limit.
Difference between 15G/15H:
One can also use Form 15H to fulfill the TDS exemption, the only difference is Form 15G is for those who are below 60 years of age, whereas, Form 15H is for those whose age is more than 60 years.
Forgot to submit Form 15G/15H, then
The steps to follow are mentioned below:
Step 1: Claim your TDS refund by filing an income tax return.
The only way out is to get an income tax refund by filing ITR. Upon verification, the Income Tax Department will process your request for refund back and credit the excess tax deducted for the financial year.
Option 2: Immediately submit Form 15G to avoid further deductions for the current financial year in the remaining quarters.
