1. Form 15G/Form 15H - Everything You must know-
Tax Deducted at Source (TDS) is a specific amount deducted from your salary, commission, rent, interest, professional fees, etc. However, on the other side, If your interest income is less than the basic exemption limit then Form 15H & Form 15G can play a vital role for you. You can fill up these forms to make sure that the payer does not deduct the TDS (tax at the source) from your income. But you might be wondering what is form 15G/. Right! So let’s get it in more detail below. Read on!
2. What are Form 15G & Form 15H?
Form 15G is a declaration form under sections 197A (1) & 197A (1A) submitted by the taxpayers in case their interest income is not taxable or income is below the minimum exemption limit. Form 15H is almost similar to Form 15G. Individuals can claim their income earned from interest without any deduction by furnishing Form 15H. Now the question may arise - If both forms are similar then what’s the difference between these? Right! So let’s know the difference below.
3. Difference between Form 15G/15H
Form 15G/15H are both quite similar in conditions but there is one major difference - Form 15H is applicable to those individuals (Senior Citizens) who are 60 years old or more than this. And Form 15G is applicable to individuals whose age is less than 60 years.
4. Conditions For Filing Form 15G/15H
There are certain predefined conditions to be eligible for filing form 15G/15H. Kindly ensure that you fulfill the below-mentioned requirements- The amount of tax calculated is zero on your total income You should be an Indian resident or HUF Your age must be less than 60 years for filing form 15G & to file form 15H, your age must be at least 60 years or more. Your interest income is less than the basic exemption limit in that specific year.
5. Why is it important to submit Form 15G/H?
You must furnish form 15G/15H to avoid a TDS deduction by your bank or entity from your income if your total income is below the exemption limit. Requesting to stop the TDS deduction from your income can help you to get the whole income. For instance - For instance, let’s say, Radhika earns a total interest income of Rs. 2.4 lac from her FD during a financial year, and she does not have other income. In this case, the bank will deduct tax at 10% of her income until she submits Form 15G or 15H. This means the TDS amount will come up to Rs. 24,000, leaving her with just Rs. 2,16,000 as her income during the year. However, she could only get this TDS amount back by claiming a refund when she files her income tax returns. Thus, we can say that if Radhika submits form 15G to the bank requesting to stop the TDS deduction from her income, then she would get an entire income without any deductions.
6. How to fill out form 15G/Form 15H?
There are certain major entries and details that you need to furnish in Form 15G/15H, as the case may be. We have mentioned those entries below to help you to get a better understanding of how to fill these forms in the various fields provided in form 15G/15H. Fill in all these entries carefully for successful online or offline submission of your Form 15G or 15H. Required Details To file Form 15G/15H Before filing your form 15G/15H, it is necessary that you are well aware & prepared with the following details. PAN Residential Status Address Details Contact Information Evaluated Income Details Previously Filed Form 15G/ 15H Details Name of the Assessee or Declarant: You need to enter your name as per your tax records and PAN card in this section. Status: Here, you are required to mention whether you are an individual or (HUF) Hindu Undivided Family. Previous Year: You need to then fill out the current financial year for which you want to furnish the form. Residential Status: Mention your residential status here. However, NRIs are not permitted to fill out this form. Address: Fill out your complete address, PIN code, email id, and phone number in this section. If your income has been assessed to Tax Under the Income Tax Act 1961: If your income had surpassed the basic taxable limits in the last six financial years, mention it in this field. Estimated Income for Which Declaration is Made: Mention the total of all your income that you earning from various sources & on which you are claiming exemption from TDS.
7. What are the types of income sources for which can submit Form 15G/15H?
We know that the TDS or tax deducted at source is not deducted on all income but most. However, sometimes people get confused about whether should they submit form 15G/15H or not. Therefore, we heard you & mentioned below a list of various income sources to give you an open view for submission of Form 15G/15H. Corporate Bonds - You can submit form 15G/15H on income earned from corporate bonds. If you are earning an interest income from corporate bonds which is more than Rs. 5000 then tax deducted at the source to be deducted from the same. You can submit form 15G / 15H to the TDS deductor requesting not to deduct the TDS from your income. Rental Income - If your rental income is more than Rs. 2,40,000 for a year then the tenant will be liable to deducted TDS. However, if your total income along with the rental income is not taxable then you can submit Form 15G /15H to the tenant to save yourself from a TDS deduction. Insurance Commission - Earlier if the insurance commission surpasses the limit of Rs. 15,000 earned by the agent then TDS would be get deducted from it. However, now insurance agents are also allowed to submit Form 15G/15H for non-deduction of TDS (in case the tax on their total income is zero). Dividend Income - Earlier the dividends were not liable to the TDS due to DDT (Dividend Distribution Tax). But since the financial year 2021-22, TDS 10% will be deducted from dividend income if it is more than Rs. 5,000. However, a trader can submit Form 15G/15H for non-deduction of TDS if the tax on their total income is zero.
Frequently Asked Questions
Can I NRI file form 15G/15H?
No. NRIs are not allowed to file form 15G and form 15H. On the Indian residents can file form 15G/15H.
Who is liable to deduct TDS on dividends?
The company is liable to deduct the TDS on the dividends ( If exceeds the limit of Rs. 5000) @10%.
What if I forgot to fill out form 15G/15H?
If you fail to fill and submit form 15G/15H due to any circumstances, and then you might have TDS deducted and you will have to apply for an income tax refund later.
Do I need to submit form 15H/15G to all branches of work?
No. You are only required to submit form 15G/15H to the branch in which you have a fixed deposit. But for more ease process, you can submit it online too.
Should I submit form 15G/15H to the income tax department?
No. You do not need to submit these forms to the income tax department. You need to submit form 15G/15H to the deductor/person or entity paying you income.
Does filing Form 15G/H make my interest income tax-free?
No. Furnishing Form 15G/15H does not confirm that your income would be tax-free. It just indicates that no TDS deduction will be made from your income by the deductor.
What is the time duration to submit Form 15G/15H?
Form 15G/15H can be submitted at the beginning of every financial year. Therefore, the deductor shall not deduct TDS while filing quarterly TDS returns during the year.
Who can submit form 15H?
You should be a resident of India/HUF with an age of more than 60 years and can file a form 15G to the TDS deductor ( The income should be less than Rs. 2,50,000.
Can HUF also file form 15G/15H?
Yes. If the Hindu undivided family or HUF fulfills all the conditions then they can also submit form 15G/15H to the deductor.