Banks deduct TDS when the interest income of an individual is above 40,000 rupees (as per the rules revision in 2019). However, in case your total income sums below the taxable limit, you are eligible to submit Form 15G and request the bank not to deduct TDS on the interest you earn in a financial year.
Understanding the dynamics of such a situation can be difficult. It includes a lot of clauses, conditions, etc. and people may find it difficult to proceed with. Keeping that in mind, we have tried to look for the most frequently asked questions about Form 15G and tried to answer them as fluidly as possible. Treat these questions and answers as a basic guide on Form 15G’s various components. Click here https://www.turtlemint.com/form-15g-and-15h/ for more information on Form 15G & 15H.
Q1. How is Form 15G Different From Form 15H?
Form 15H serves a similar purpose as Form 15G but is meant for citizens above the age of 60 years. Individuals, as well as Hindu Undivided families, can submit Form 15G whereas no other taxpayer besides senior citizens can submit Form 15H.
The Form 15G can be filled only by individuals who do not have any tax liability and whose annual income is below the basic exemption limit. The 15H Form, on the other hand, can be submitted by a senior citizen whose interest income exceeds the basic limit but their total annual income has to be below the basic annual income.
Q2. Who Can Submit Form 15G?
Form 15G can be submitted by anyone who fulfills the following conditions:
- Must be below the age of 60
- Must be an Indian resident
- It is only for individuals and Hindu Undivided Families (HUF).
- The income tax calculated must be nil.
- The total annual income should be less than the basic stipulated exemption limit of that year.
Q3. What is the Basic Exemption Limit?
There are certain limits on your income that must be kept in mind before submitting the Form. If those criteria are not met, your Form might get rejected.
Any individual or HUF whose annual income is below Rs. 2.5 lakh can submit the Form, provided they are below 60 years of age. The basic exemption limit on their tax should also be below 40,000. In case, any of the exemption limits exceed, the applicant’s Form will be rejected.
Q4. When to Submit the Form?
You can submit the Form to your bank at the beginning of every financial year. As soon as your Form is submitted, the bank scrutinizes your details and ensures that no tax deductions at the source take place.
The coronavirus, however, compelled the government to make certain changes in the cycle. The validity of submitting Forms in the financial year 2020-21 has been extended up to the first week of July 2021, which previously was supposed to be March 2021. For the upcoming year, one must keep an eye on the dates given out by the government. But it is always better to submit the Forms by March.
Q5. What Happens If You Forget to Submit Your Form?
In case you forget to submit your Form 15G, financial institutions and banks deduct the tax on investment interests. You can then ask for a refund from the Income Tax Department.
If your aim is to get a refund on your TDS, you should file your income tax return. You are not eligible to submit your Forms after the due date is over. If you do so, the financial institutions cannot refund your TDS.
Several institutions and banks deduct the TDS quarterly and not annually. In that case, you can submit your Form later for the next quarter and at the financial year-end claim the dedicated TDS from the Income Tax Department by filing the Income Tax Return Form.