Form 15G and 15H: When an individual is earning some income that is above the limits prescribed by the govt of India, the individual has to pay income tax to the government. In order to save taxes, individuals will choose products such as Tax Saving Mutual funds, Fixed deposits among other investment options.
When you have an FD with a particular bank, in maximum scenarios, the bank will deduct TDS on the income earned by you. For beginners who have no idea about TDS, Let me explain to you. TDS stands for Tax deducted at source. The bank when crediting the interest to your account will deduct the income tax on the income interest which is earned by you.
But when your total income including the interest you are earning from the bank is below the taxable limits as prescribed by the government of India, in such scenarios you have to submit Form 15G and Form 15H to the bank requesting it not to deduct the TDS as your income is below the taxable limits.
Form 15G and Form 15H are two types of form which an Individual with a Permanent Account Number(PAN) must submit to the Bank to stop the bank from deducting TDS from the interest earned by you.
Not only on the interest from the bank, Even in scenarios where you are getting Dividend payout from companies whose stocks you are holding in your account. If you have not submitted Form 15G or Form 15H, the company which is giving the dividend by default will deduct TDS on the dividend earned by you. The TDS restriction for Dividend earned will keep on changing from time to time. Please keep an eye on the FInance ministry notifications regarding the same.
Difference Between Form 15G and Form 15H
Both From 15G and Form 15H serve the same purpose. to enable individuals to claim tax-free income in case of interest earned of any other types of earning such as dividends from companies.
The main difference between the two will be the age of the individuals. Form 15G is to be filled by the individual whose age is below 60 years. Form 15H is to be filled by an individual whose age is above 60 years. This is because individuals above 60 years are treated as senior citizens and their tax structure is different from the individuals below 60 years of age.
Eligibility for Form 15G
An Individual or HUF or trust or any other assessee
Only Indian Resident can apply
Age should be less than 60 years old
Tax calculated on their Total Income should be nil
The total interest income for the year should be less than the basic exemption limit of that year
Eligibility for Form 15H
A Resident Indian Individual
Age should be 60 yrs or more (senior citizen) during the year for which you are submitting the form
Tax calculated on their Total Income should be NIL
Form 15G and Form 15H Frequently Asked Questions
Read Frequently asked question related to Form 15G and Form 15H By clicking here
These forms can be submitted both offline and Online. Most of the bank provides the options to submit the form online and very few banks request you to visit the branch office to submit the form Offline.
In case of submitting the form for Dividends. you can in a maximum number of scenarios submit the forms online. In most cases, a single mail with the filled form as an attachment will be enough. You check the details regarding the same in the Official which you will receive from the Company(Which announced the dividend) Secretary or other corporate head when a dividend is announced.
Banks which are providing the online facility of Form submission are SBI and ICICI Bank. You can login to their internet banking and submit the forms.