Form 15G and Form 15H | How to Submit in Bank?

Did you ever think to avoid deduction of TDS on your interest income?
Banks deduct TDS at 10% on your interest income on deposits if it is more than rupees 10000 in a year and rupees 50000 in case of senior citizens.

For the calculation purpose, banks add interest income to all its branches.

Now the Income Tax Department has provided an option to avoid deduction of TDS on your interest income.

If you want to save TDS or do not want TDS to be deducted by banks then you can simply submit the form 15G or form 15H to the bank.

What is form 15G and 15H used for?

Form 15G and 15H to use to avoid deduction of TDS.

It is submitted only if your estimated total income of the financial year is below the taxable limit for that year,

It means you can submit the form 15G and 15H only if you are tax liability come to Nil or zero.

It is important to note that these forms are valid only for one year; you have to submit the form every year in the beginning of the financial year.

How to submit form 15G and 15H in bank?

These forms need to be submitted at the beginning of every financial year.

Example for the financial year 2019-20, you have to submit a form at the beginning of the year 2019-20 so that banks do not detect your TDS.

But due to the impact of covid-19, The Income Tax Department has given some relief regarding submission of form 15G and 15H for financial year 2020-21.

In this relief those form you had submitted for the financial year 2019-20 will also remain valid for the first quarter of financial year 2020-21 (i.e. from 1st April 2020 to 30 June 2020).

Sometimes, it may happen that assesse forget to submit a form on time.

In that case assesse has to file its regular Income Tax return to claim refund of TDS.

It may be possible that TDS has deducted by bank due to non-submission of 15G and 15H. The only way to claim a refund is filing ITR.

Which form is made for whom?

Eligibility / Conditions to submit form 15G

Your age should be less than 60 years.
You should be a resident of India.
15G form should not be filled by a company or a firm.
Your tax on total income should be nil.
Your total interest income for the financial year should be less than the basic exemption limit of that financial year.

For submitting form 15G you should have to fulfill all the above conditions.

Eligibility / Conditions to submit form 15H

Form 15H should be submitted by those whose age is 60 year or more and have tax liability nil.

What details to be filled in form 15G and 15H?

The assesse has to submit form 15G and 15H to the bank with complete detail. You have to state:

The name of assesse
Pan of assesse
Residential status
Detail of income and tax liability
Address
Status (like individual, HUF or Trust)
Details regarding any other form of 15G or 15H you had filled in other banks excluding the current form.

What is the procedure for Banks (TDS deductor)?

When the assesse has filled the form 15G or 15H then he has to submit the same to the bank.

Banks must allot a UIN (Unique Identification number) to everyone who submits a form 15G / 15H.

On quarterly basis the bank has to file the statement of Form 15G and 15H to the Income Tax department. Banks must retain form 15G/ 15 age for 7 years.

What other purpose form 15G and form 15H can be submitted?

One can submit form 15G and 15H to avoid TDS on following items after fulfilling condition of the respective forms:

Avoid TDS on rent

Tenants can deduct TDS if rent exceeds rupees 240000 per annum, if your tax liability is nil then you can simply submit form 15G or 15H to your Tenants.

Avoid TDS on Commission related to insurance

You can simply avoid TDS on insurance commission by submitting form 15G or 15H if your tax on total income is NIL.

Withdrawal from EPF

TDS is deducted on Employees Provident Fund withdrawal if service of a person is less than 5 year and withdraw EPF of more than rupees 50000.

In this case you can avoid TDS by filling form 15G or form 15H as the case may be.

Similarly you can avoid TDS on income from corporate bonds and TDS on post office deposits.

But remember for all the purposes the main condition for form 15G and 15H must be fulfilled.

Conclusion

Forms 15G and 15H are beneficial for those whose tax on total income is Nil and don't want TDS to be deducted by the bank.

These forms are valid for only one year and have to submit it every year during the first quarter.

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