Form 15G: Know how to use Form 15G and 15H to save TDS on interest income

Banks are mandated to deduct TDS on the interest income of a customer under Section 194A of the Income-Tax Act, even if an individual’s income does not fall under the taxable limit. However, the I-T law also provides taxpayers with a tool to avoid paying TDS, in case their income does not fall under the taxable bracket. Form 15G and 15H enable the taxpayer to avoid TDS deductions.

 

What are Form 15G and Form 15H?

Form 15G and Form 15H are self-declarations submitted to the bank, stating that the income is within the tax exemption limit and the bank should not deduct TDS on the interest earned on the deposits or investments.

Note that a bank will deduct TDS on your income interest when the total interest earned across its branches exceeds Rs 10,000.

See also: TDS full form: All you need to know about tax deducted at source

Those submitting Form 15G or Form 15H must quote their PAN card details. Do remember that the submission of Form 15G or Form 15H is not a one-time occurrence; it has to be submitted every year within a specified time.

While Form 15G download is possible online, you have to visit the bank branch to submit this declaration. Some banks allow online submission of Form 15G.

 

 

Form 15G download

Click here to download Form 15G.

Click here to download Form 15H

 

Applicability of Form 15G/Form 15H

Form 15G can be used to avoid TDS on interest on bank deposits, securities, provident funds, NSS and the like, but no other source of income.

You can use Form 15G to avoid paying TDS, only if you meet the following conditions:

• If your basic income is below the exemption limit of Rs 2.50 lakhs per year.
• Only an individual (up to 60 years) or HUF or trust, can submit Form 15G. It is not meant for companies and businesses.
• An individual aged above 60 years has to fill and submit Form 15H in place of Form 15G.
• Only Indian residents can submit Form 15G or 15H. This benefit is not open to non-resident Indians.
• Form 15G can be submitted only if your income, including the combined interest earned at the bank, is within the tax exemption limit. Senior citizens can submit Form 15H even if their income interest is above the basic tax exemption limit, as long as their taxable income after deductions is below the exemption limit.
• Form 15G or Form 15H cannot be submitted by someone whose income interest is clubbed with another individual. So, if you have an FD (fixed deposit) in the name of your non-working wife or minor child, Form 15G/Form 15H will not apply to you.

Be advised that the mere submission of Form 15G or Form 15H will not result in your interest income becoming tax-free. You should submit these forms, only if your income, including the interest earned, does not cross the basic exemption limit under the income tax slab.

 

Instances where you have to submit Form 15H/Form 15G

Apart from income interest, TDS is also deducted on the following incomes and the taxpayers can submit Form 15G or Form 15G to avoid paying TDS on them:

• TDS on fixed deposit

TDS is deducted if FD interest is more than Rs 10,000 in a year.

• TDS on recurring deposit

TDS is deducted if RD interest is more than Rs 10,000 in a year.

• TDS on post office deposits

TDS is deducted if interest is more than Rs 10,000 in a year.

• TDS on EPF withdrawal

In case an employee withdraws more than Rs 50,000 from his EPF account before five years of continuous service, TDS will come into play.

• TDS on rent

TDS would be deducted if the rental income is more than Rs 2.4 lakhs in a year.

• TDS on insurance payments

TDS at the rate of 2% will be deducted if the premium is more than Rs 1 lakh and the maturity proceeds are taxable.

• TDS on insurance commission

TDS is deducted if the commission is more than Rs 15,000 in a financial year.

• TDS on income from corporate bonds

TDS is deducted if the interest is more than Rs 5,000.

 

Form 15G for PF withdrawal

In case you fail to submit Form 15G, TDS will be deducted at a rate of 10%. In case you neither submit your PAN card details nor Form 15G or Form 15H, TDS at the rate of 34.6% will be deducted from the withdrawal amount. You can find and download Form 15G from the EPFO portal, using your UAN login.

 

How to fill Form 15G?

Form 15G has two parts. Only Part-1 is to be filled by the taxpayer. Part-2 is filled by the bank, post office or the EPFO office concerned. You will have to fill in the following details in your Form 15G:

• Your name: As mentioned on your PAN card
• You PAN card number
• Your status: Individual/HUF/trust
• Previous year: Financial year for which the form is submitted
• Residential status: Indian
• Your address
• Email ID
• Telephone number
• Mobile number
• Whether assessed for tax under the I-T Act, 1961: Tick YES if your income was above the basic exemption limit even once in the past six years. Also, mention the year in which your income was taxed.
• Estimated income for which declaration is made: Mention the income on which the TDS should be exempted.
• Estimated total income of the previous year in which the income mentioned under Column 16 is to be included: Club all your incomes for the year, along with the interest mentioned in Column 16
• Details of Form 15G other than the present form, filed during the previous year, if any: Mention the number of Form 15G submitted for that year.
• Aggregate income amount, for which Form 15G is filed: Provide the aggregate amount for which Form 15G was submitted.

Now, input details of interest income for which declaration is filed, including:

• Identification number or investment/account number: This includes PF account details, fixed deposit account details, recurring deposit account details, NSC details, life insurance policy details, etc.
• Nature of income
• Section under which tax is deductible
• Amount of income
• Finally, provide your signature

See also: All about TDS on sale of property under Section 194IA

 

Where to submit Form 15G?

Depending on where you have parked your money for savings, you may have to submit your Form 15G at the following places:

• Banks
• EPFO branch for premature withdrawal of PF
• Offices of corporate issuing bond
• Insurance company office by insurance agents
• Post office for deposits

You must submit Form 15G/Form 15H at each branch of the bank from which you receive income interest.

 

How to submit Form 15G online?

In case your bank offers the online facility to submit Form 15G, you can log into your net banking account, download, fill and submit the form online.

 

What if you fail to submit Form 15G/Form 15H on time?

In case you have not submitted your Form 15G/Form 15H, the entity concerned would have already deducted the TDS. In such a scenario, you can claim a refund while filing your income tax return.

Since TDS is deducted by banks on a quarter-on-quarter basis, submit your Form 15G immediately so that the TDS is not deducted in the following quarter.

 

FAQs

What is Form 15 G?

Form 15G is a self-declaration submitted to banks, the EPFO or post offices, stating that the taxpayer’s income with interest is within the basic tax exemption limit and TDS should not be deducted as prescribed under the rules of Section 194A of the Income Tax Act.

Is it necessary to fill out Form 15G?

It is important to fill out and submit Form 15G if you are earning interest on your savings and want to avoid TDS deductions.

Who can file Form 15G?

Individuals, HUFs and trusts, whose total income, including the interest earned on deposits, is within the basic tax exemption limit can file Form 15G.

What is Form 15G in EPFO?

TDS is deducted, if more than Rs 50,000 is withdrawn from your EPF account before the completion of five years of continuous services. In case your total income is within the tax exemption limit, you have to submit Form 15G to claim relief from the TDS deduction.

What is the validity of Form 15G?

Form 15G is valid only for one financial year. You have to furnish a new Form 15G every year.

Do I have to submit Form 15G or Form 15H to the Income-Tax Department?

No, you only have to submit this self-declaration form to your bank, and not to the Income-Tax Department.