Definition of Form 15G
Fixed deposit holders fill the Form 15G, which serves as a declaration. This category contains individuals under the age of 60 and HUFs. The purpose is to control TDS on interest income during the fiscal year. The Form 15G is available under Section 197A of the Income Tax Act of 1961. By submitting Form 15G to the bank, individuals are disclosing their annual income and requesting to stop the TDS deductions on their interest income.
Meaning of Form 15H
Form 15H serves as a self-declaration form that senior citizens aged 60 years or above can submit to exempt themselves from TDS liability on interest earned from fixed deposits (FD) and recurring deposits (RD). It comes under Section 197A, Subsection 1C of the Income Tax Act, 1961. Senior citizens can receive the full interest on their deposits without any tax deduction through this declaration.
What Is the Method for Submitting 15G and 15H Forms?
The validity for both Form 15G and Form 15H is for the period of one financial year. These forms are submitted each year at the start of the financial year. By doing so, individuals can ensure that their interest income is not subject to TDS deductions by the bank. You can easily submit forms 15G and 15H with one of the simple and error-free Gen TDS software. It helps you to ensure that your returns are submitted without any issues.
Essential Points to Filing Forms 15G and 15H
When filling out these forms, it's essential to keep the following points in mind:
- Although not mandatory, submitting Form 15G/Form 15H can prevent excessive tax payments if you qualify for TDS relief.
- Do not submit the declaration if you have taxable income for the relevant financial year.
- Fraudulent submission of these forms can result in penalties under section 277 of the IT Act, 1961.
- These forms do not replace the requirement to file an Income Tax return form; you need to do it separately.
- Non-resident Indians (NRIs) are presently not eligible to submit Form 15G or Form 15H as per current regulations.
- If Form 15H/Form 15G is submitted late and TDS is deducted, individuals can claim a refund for the excess TDS deducted by filing an Income Tax Return.
What Are the Alternate Benefits of Forms 15G and 15H?
Forms 15G and 15H can also be submitted for the following purposes:
- TDS on rent
- Recipients of LIC premiums
- Commissions on insurance are taxed
- TDS on post office deposits
- Withdrawals from EPF are taxed
- Income taxes on corporate bonds
Key Distinctions B/W the Forms 15G and 15H
The distinctions between Form 15G and Form 15H can be described as follows:
Eligibility Criteria for Submitting Forms 15G and 15H with Examples
The example explained below, through a table, will make it clear to you who is eligible to fill out Form 15G and Form 15H. It is based on different age groups and income criteria:
Key Points with Example:
- If you are 50 years old and your interest income exceeds the tax-exempt limit of Rs 2.5 lakhs for your age, you cannot use Form 15G.
- At the age of 62, even if your interest income is more than Rs 2.5 lakhs, you can still use Form 15H as long as it remains below the maximum exempt income of Rs 3 lakhs for your age.
- Similarly, at the age of 81, if your interest income does not exceed Rs 5 lakhs, you can use Form 15H. However, your total taxable income should also be below this limit.
What Are the Actions You Can Take If Not File Form 15G and Form 15H?
Submitting Form 15G and Form 15H is an annual requirement that can sometimes be overlooked. You have missed submitting these forms, and the bank has deducted TDS as a result. There are steps you can take to minimise the TDS deductions and recover the amounts:
Instantly Submit the Form 15G and Form 15H
Your initial step should be the prompt submission of Form 15G or 15H to prevent any additional deductions. You have a grace period of up to 90 days after the commencement of the new financial year to submit the form. If you miss this deadline, ensure to submit it within the subsequent quarter. Banks typically disburse interest payments every quarter, allowing you to preserve your TDS savings for future interest earnings.
Filing of ITR
Submit your Income Tax Return (ITR) if you have the opportunity to provide a precise estimation of your taxable income and any applicable rebates. Your Form 26AS will display the Tax Deducted at Source (TDS) deductions from the previous year, which should encompass any TDS deductions made by banks on the interest payments to you.
This sum is offset against your total tax obligation for the fiscal year. If you were eligible for Form 15G or 15H, your tax liability would be reduced to zero. Any excess TDS amount, as indicated in Form 26AS, should be refunded to you.
More Additional Methods to e-file Form 15H & 15G
Form 15G and Form 15H prevent TDS deductions on bank interest payments, but their applicability extends beyond banks. The forms employed to evade TDS deductions in the following scenarios:
Interest Payments Corporate Bond On TDS
If your interest income from corporate bond investments surpasses Rs 5,000 in a financial year, TDS will be applicable. You can submit Form 15G or 15H to exempt this income from TDS.
EPF Withdrawals on TDS
TDS is deducted from the Employees' Provident Fund (EPF) balance before completing five years of service.
The Employees' Provident Fund Organisation (EPFO) will impose TDS if the withdrawal exceeds Rs 50,000. The TDS rate stands at 10% for such withdrawals if you have furnished your PAN. Without PAN, the rate rises to 34.606%.
TDS Rental Income
If case you receive rental income from a firm or association of persons, TDS may apply to these earnings. The lessee, responsible for the rent, should deduct TDS at a rate of 10% if the annual rental income exceeds Rs 2.4 lakhs. Yet, if rental income is your sole source of income for the fiscal year, you can submit Form 15G or 15H to avoid TDS.
Post Office Deposits On TDS
TDS will be applied by the post office to interest payments exceeding Rs 50,000 in the Senior Citizen Savings Scheme. To exempt your interest from TDS, you can make use of Form 15H.
What Makes Gen TDS Software a Useful Option for Filing 15G and 15H Forms?
For streamlined online filing of TDS and TCS returns in compliance with TRACES and CPC regulations in India, consider utilising Gen E-TDS software. It offers a user-friendly interface, making TDS calculations, return preparation, and the assessment of interest, penalties, and late filing fees a seamless process.
This software is officially recognised by the Indian government's tax information network as an authorised TDS software and received the highest ranking in 2012-13. The Gen TDS is govt's well-known software in India, enabling professionals to log in directly to the NSDL portal, eliminating the need to generate user IDs each time.
Features of Gen e-TDS Return Filing Software
- Uploading online TDS/TCS e-return on the portal.
- The software delivers e-TDS returns and calculates taxes.
- Confirms proper validation of the returns 24Q, 27Q, 26Q, and 27EQ by generating e-filings.
- Non-filing of declarations and tax returns for no TDS deduction.
- Certificates in PDF format for forms 16, 16A, and 27D, along with the option of a digital signature (optional).
- Online Correction Statement Filling and Uploading.
- Certificates in Form 16AA, 12BA, 16, 27D, and 27A, 27B.
- A request can be downloaded via the TRACES portal, including files of consolidated, justification reports, and forms 16A and 16.
- Post-furnishing effect on the deduction under Chapter VI-A, annual taxable salary computation.
Procedure to e-file 15G and 15H Forms Through Gen TDS Software
Below are the easier guide to e-file the forms 15G and 15H using Gen TDS Software-
Case 1: Form 15G e-filing
Step 1:- Install the Gen TDS Return Filing Software on your laptop and PC.
Step 2:- Post to that Open the TDS Software and tap on the 15G/15H Tab.
Step 3:- Choose the Client to whom you want to submit Form 15G.
Step 4:- Tap on the view or edit statement to prepare the statement. If you've prepared multiple statements, you can review them by selecting "View Complete Statement." To create a new correction statement, click on the "Prepare New Correction Statement" tab.
Step 5: Enter details of the Date of Remittance, Status, Income Amount, Date of Payment, and other relevant details. After filling in the details, click on the "update" button.
Step 6:- Post to that, tap on Generate CSV for the upload button to upload the 15G Form.
Step 7:- Post to that tap on Save File and choose the location where you want to save the File.
Step 8:- Post to that tap on the Yes button to upload the Basic information and CSV File.
Step 9: Now select the Google Chrome button to upload it.
Case 2: Form 15H e-filing
Step 1:- First Open the TDS Software and tap on the 15G/15H Tab.
Step 2:- Post to that select client to which you want to submit Form 15H.
Step 3: To prepare the statement, click on "View/Edit Statement." If you've created multiple statements, you can view them under "View Complete Statement." To generate a new correction statement, select "Prepare New Correction Statement."
Step 4: Enter the required information, including the amount of income paid, the date of payment or credit, Declarant Details, Status, and other pertinent details. After providing the details, click the "update" button.
Step 5: To preview the Form, use the "Preview Form 15H" tab. To upload the Form, click on "Generate CSV for the upload."
Step 6: Save the file by clicking "Save File" and choosing the desired location for saving it.
Step 7: Select the Google Chrome button to upload the file.