Business Mantra: Faridabad
- Many people open Fixed Deposits/Recurring Deposits in different Branches of a Bank and many in different Banks
- The Income of a person exceed the basic exemption limit of Rs.2.50 Lakhs
- Even then they submit Form 15-G/H just to evade TDS
- Now “On-line” compilation will be there
- False forms be rejected resulting thereto prosecution
Therefore everyone who is submitting Form 15-G/H should keep in mind the following:
In the first quarter of new financial year, it becomes important for the persons receiving “Interest on Securities/Fixed Deposits/Recurring Deposits” etc. to get the interest without the deduction of tax. This is possible only, if one submits a declaration to the Income Tax Authorities in the format issued by the authorities itself in the format called Form 15-G & Form 15-H. While submitting these declarations, precautions should be observed.
When TDS is deducted by the Bank:
If the interest on Fixed Deposit (FD) or the Recurring Deposit (RD) to one holder is more than Rs.10000/- in a financial year then Bank is bound to deduct tax at source (TDS). In core banking, interest in all branches (combined) is considered whereas interest of Rs.10000/- is considered per branch.
Who can submit Form 15-G or Form 15-H
Any person who is of the age of 60 or less has to submit Form 15-G to the Bank, whereas persons above the age of 60 are to submit Form 15-H to the Bank, so that the Bank does not deduct TDS on the interest on FD/RD where interest amount exceeds Rs.10000/- in one financial year.
Rate of deduction of TDS in normal course is 10% on the total interest in one financial year. If a person does not have PAN in his name then TDS is sure to be deducted also at a higher rate i.e. at 20%.
Precautions while submitting Form 15-G/H
Generally where the persons who open FD/RD in different Banks under Core Banking System/Solutions (CBS), then they need not submit Form 15-G/H branch wise. Where CBS is not available in Banks then people submit multiple forms of Form 15-G/H in different branches of different banks or oven same bank.
But everybody who submits these forms should keep in their minds the following:
- These forms are to be submitted preferably in first week of April, every year or before the accrual of interest in the FD/RD.
- If a person is senior citizen i.e. above the age of 60 then Form 15-H is to be submitted otherwise Form 15-G has to be submitted.
- The Form G/H is not to be submitted if the income of a person exceeds the basic exemption limit of Rs.2.50 Lakhs, then interest amount is not relevant for submitting the said form.
- If a person does not hold PAN, he cannot deposit Form 15 G/H.
- If the FD/RD stands in joint name then TDS/Form 15-G/H is applicable to the first name in FD/RD
- These forms can be submitted in physical form to the concerned Bank, it is further advised to obtain receipt from the Bank while submitting Form 15-G/H and
- Or if the forms are being submitted “On-line” then one must keep in mind certain precautions:
- Only one Form 15-G/H can be up-loaded against one PAN in one financial year.
- If the income of a person exceeds the basic exemption limit of Rs.2.50 Lakhs, no Form 15 G/H can be up-loaded in the system
Penalty for submitting false statement in Form 15-G/H:
In case any person found to be submitting false statement while depositing the Form 15-G/H, the assessing officer has full authority for penalize with an imprisonment of 3 months for such false statement.
What to do if TDS is deducted, even if Form 15G/H submitted:
If TDS is deducted even if Form 15-G/H was submitted, Bank cannot refund the deducted amount to the concerned person. The only solution available is to apply for refund from the Income Tax Authorities by filing Income Tax Return, after getting Form 16A from the bank.
In short, it is earnestly requested to file Form 15-G/H if eligible and also preferably in the first week of new Financial Year, mentioning the correct data and PAN