Form 15G is a necessary form that is required to be filled if a person wants the income provider to not deduct tax or TDS for the given income. This is done by the individuals who want to withdraw their EPF before completing 5 years of service. Therefore, from 1st June 2015 onwards, anyone who wants to withdraw their EPF before completion of 5 years of service has to fill up Form 15G.
The person who is withdrawing his EPF before completing 5 years of service and has accumulated a balance of more than or equal to Rs 3 lakhs, then this person has to submit Form 15G or 15H and also have to give their PAN card if they want to avoid TDS. If the PAN card is not submitted, 10% TDS will be deducted from the total EPF amount.
In this detailed guide, we will take you to step by step on how to fill the Form 15G and how to fill the Form 15H respectively.
If you want to see filled sample Form 15H for a senior citizen then click here. If you want to see filled sample Form 15G for withdrawal of EPF, then click here.
- 1 How to avoid TDS deduction for Form 15G and Form 15H?
- 2 How to fill Form 15G and Form 15H of Income Tax?
- 3 How to Fill The Form 15G And Form 15H?
How to avoid TDS deduction for Form 15G and Form 15H?
What exactly is TDS on Income??
TDS means Tax Deducted at Source. It is one of the ways through which the government collects taxes. In this method, a particular percentage is deducted at the time of payments of different types like salary, rent, commission, interest on dividends etc and this deducted amount is remitted to the Government. At the end of the fiscal year, you can adjust this deducted amount against tax due.
What is Form 15G and Form 15H of Income Tax?
The Form 15G or Form 15H is submitted if you want to request the income provider to not deduct tax or TDS for the given income.
- Either of these forms can only be used for payments which are in the form of Interest of Securities, NSS, and Interest on Units, other kinds of Interest, etc. You cannot use these forms for other kinds of payments. If you are withdrawing your PF amount, then you have to fill the Form 15G if you do not want TDS to be deducted from the amount.
- You can submit either of these forms to the company, EPFO, bank, etc.
- You may need up to 3 duplicate forms as per the requirement of the payer which can be a post office or a bank or a company, so be prepared. The payer takes these forms on record and the entire interest is paid to you without deducting TDS.
- Form 15G is filled by the Indian residents who are below the age of 60 years, HUF’s and trusts. Whereas, the Form 15H is to be filled by residents above the age of 60.
- Only Indian residents, HUF and AOP can fill up either of these forms.
What are the conditions to fill Form 15G and Form 15H of Income Tax??
You need a valid reason to request your bank to not deduct TDS on the given income. Therefore, make sure that you have a strong reason and you meet all the necessary conditions which are required for filing the Form 15G. Please check the below image for additional details.
You can earn extra income from interests on fixed deposits, savings account, senior citizen schemes, etc. But you have to declare all the income generated in Interests from any source on your income tax return. You have to declare it under “Income from other sources“.
Some of the basic conditions to file Form 15G are:
- The final tax that is computed on the estimated total income according to the Income Tax Act should be zero.
- Your total interest from all the sources in a given financial year should not exceed the basic exemption slab for that year.
If the above-mentioned criteria are met, you can submit Form 15G and receive income without deduction of TDS. If you miss out on any of those criteria, TDS will be deducted from your income. Also, if your final tax is not zero, then even if your total interest income is below the basic exemption slab of that assessment year, you will not be able to file Form 15G and avail its benefits. It is true the other way also. If your income exceeds the basic exemption slab for that assessment year, then even if your final tax is zero, still you won’t be able to file Form 15G.
As mentioned earlier, the Form 15H of Income Tax can only be filed by Indian residents above the age of 60. The advantage of Form 15H over Form 15G is that it only imposes the 1st condition which is that the final tax amount of the assessment year should be zero. Therefore, for senior citizens to be eligible to file Form 15H, the taxable income for the specific fiscal year can be up to Rs 3,00,000. For super senior citizens i.e. people above 80 years of age, this limit is up to Rs 5,00,000. In the image given below, you will find cases where these Forms aren’t allowed.
How to fill Form 15G and Form 15H of Income Tax?
These forms are very similar to each other. There is absolutely no difference in the process of filling either of these forms. The only difference that lies between them is the criteria’s which are:
- Form 15G can be filed only by Indian residents below the age of 60, trusts, and HUFs. Form 15H is for individuals above the age of 60.
- While it is mandatory to meet both the criteria to file Form 15G, in case of Form 15H, only the 1st condition needs to be satisfied which says that the final tax amount of the assessment year should be zero.
Changes Introduced In the Form 15G and Form 15H of Income Tax
From 1st October 2015, the Income Tax Department of India has announced key changes to the Form 15G and Form 15H and also have introduced a new procedure. The important changes are:
- All the schedules like Schedule 1,2,3 etc have been removed which has simplified the forms to a great extent.
- Now you can fill both of these forms online. There are no rules prescribed regarding the procedure for filling out the forms, however, the forms can be filed by using the Internet Banking facility. You can also use other modes of making payment online by using a debit card etc.
- Once the payment is done, the person (also called Deductor) will be allocated a Unique Identification Number or UIN for each of his Form 15G and Form 15H that is received.
- The particulars of the Forms 15G and 15H that are received by the deductor in any quarter has to be mentioned in the quarterly TDS statements along with the UIN. This has to be done by the deductor even if no TDS has been deducted.
- You, the deductor, will no longer be required to submit the physical copy of these Forms to the Income Tax Department.
- But, you have to maintain these forms for a minimum period of 7 years starting from the end of the financial year during which you received these forms.
How to Fill The Form 15G And Form 15H?
First, we will begin with filling Form 15G. You can check the image below.
Fill in all the information such as Name, PAN, etc correctly. After that, in the Status field, fill in your income tax status that can be either Individual/ Hindu Undivided Family(HUF)/ AOP whichever is applicable to you.
The next field is the Previous Year. This is the year during which you will earn your income and you don’t want to pay TDS. Indian Financial year (FY) starts from April 1 and ends on March 31. The income that is earned by an individual in an FY is taxed in the next FY. The Previous Year is the FY to which the taxable income belongs to. The Assessment Year (AY) is the FY in which the income will be taxed.
To give you an example, the income earned by you from April 1st, 2017 to March 31, 2018, during the financial year 2017-18, the income will be assessed for the tax in the year 2018-19. In this case, FY 2017-18 is called the Previous Year and FY 2018-19 is called the Assessment Year.
The next part is to fill out is the Residential Status. It is necessary for you to be a resident of the country for you to fill the Form 15G or 15H. Therefore, you have to declare your residential status. As per income tax, the residential status of an assessee is divided into three different categories which are Resident (ordinarily), Resident (not ordinarily), and Non-resident. A person will be treated as a resident of India if that person satisfies either of the following two conditions:
- The person is in the country for more than 182 days or more in a given year.
- The person is in the country for 60 days or more in a given year and in the next set of 4 years after this year, the person should be in the country for more than 365 days.
In the following fields, you have to fill out your Current Address details and then your Email ID, Mobile Number, and Home Landline number (if any) with STD code.
Now you will see a Field (a) Yes or No box which says that whether the assessed to tax under the income tax Act 1961. So tick the box correctly. You should only tick on YES if you want to tax under the rules of Income Tax Act 1961 for any of the previous 6 assessment years that precede the year in which you filed the declaration.
On-Field (b), if it’s a Yes, you have to mention the last assessment year for which you filed an Income Tax return. Then, in the next field which is Estimated income for which this declaration is made, you have to mention the estimated income for which you will be filing the Form. Example: If you have a Fixed Deposit and you wish no TDS to be deducted on this FD, mention interest on this FD that you will be earning this year.
The next field, the Estimated total income of the P.Y. in which income mentioned in column 16 to be included, you will have to mention the final amount of the estimated total income of the previous year for which this declaration is being filed along with the amount of income for which the declaration is being made.
After filling that information, you will see the next field i.e. Details of Form No. 15G other than this form filed during the previous year, if any, If the declaration(s) made in this Form 15G is being filed before filing the declaration during the previous year, you will have to mention the total number of these forms that are being filed plus the aggregate amount of income for which the said declaration(s) have been filed.
Total Number Of Form 15G: The number of Form 15G you have filed before the filing of this Form 15G for the current or previous Financial Year.
The aggregate amount of income: The total amount of income you have earned for which you have filed Form 15G in this year.
The last field is Details of income for which the declaration is filed. Here, you have to mention the particular number of shares, term deposits, recurring deposits, life insurance policy number, a national savings scheme, employee code, etc.
The below-given two conditions are to be satisfied in order to file Form 15G.
The details regarding these have to be filled in Fields 22,23 and schedules respectively.
- The final tax computed according to the Income Tax Act on the estimated total income should be zero.
- The total interest earned during the financial year should not be more than the basic exemption slab of that assessment year.
Total Income Estimation: The amount earned from the following sources have to be added; Interest earned on FD, securities, mutual funds, etc.
Declaration: You have to fill your details and your Signature in the appropriate places.
Part II Of Form 15G/15H (For the person for whom the declaration is being made)
You do not need to fill anything here. The person whom the declarations are being made i.e. banks, post office, etc will fill this part.
- The declaration(s) made under Form 15G/15H is not an exception for Income Tax Return. You will have to file an income tax return according to the income tax act irrespective of whether you have given a declaration to the bank or others for non-deduction of TDS.
- It is also not a way to save tax either. This simply prevents TDS deduction on income in the first place so that you won’t have to apply for a refund later.
- You have to attach a copy of your PAN card with this declaration.
- If TDS has been deducted by the income payer even though Form 15G/15H has been submitted, you can claim a TDS refund by filing an income tax return as per your tax liability. So you won’t have to worry about it.
- Click here to download Form 15G or Form 15H.
The Institutions that allow Online Submission of Form 15G and Form 15H
Various banks like the SBI, ICICI bank etc allow submission of the Form 15G and Form 15H.
- Form 15G and Form 15H will be generated according to the bank branch.
- If you have a Joint Account, then the Form 15G and Form 15H will be generated for the 1st account holder.
Hope you found the article useful. For further questions or suggestions, please leave a comment below.