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Updated on: 16 Nov 2023 | 10 min read
Under section 194A of the Income Tax Act of 1961, if your interest income exceeds ₹40,000 from FDs in a given financial year (₹50,000 for senior citizens), banks deduct TDS of 10%.
However, if your income is below the taxable limit, you can submit Form 15G for non-senior citizens and Form 15H for senior citizens. Banks will not deduct TDS if you submit Form 15G or 15H.
Form 15G and Form 15H are self-declaration forms wherein you submit the application form to the bank requesting not to deduct TDS on interest income. Various banks allow submitting these forms online from their official portal or mobile app. However, furnishing PAN is mandatory. Moreover, these forms are only for resident Indians. Non-resident Indians (NRIs) cannot use these forms to avoid TDS deduction.
To be eligible to submit Form 15G, you must:
You can download Form 15G and Form 15H from the below links:
Download Form 15G
Download Form 15H
To be eligible to submit Form 15H, you must:
Although most people file Form 15G and Form 15H when opening a deposit account. However, some might forget to submit them on time, resulting in a deduction of the TDS. In this case, you can do the following:
| Parameters | Form 15G | Form 15H |
| Eligibility | Indian residents ( not a compaany or a fir) less than 60 years of age are eligible for 15G. | Indian residents of 60 years and above are eligible for this form. |
| Uses | Form 15G can be used for non-deduction of TDS on interest income from bank deposits, interest from post office deposits, interest from rental income, Employers’ Provident Fund Withdrawal, from a life insurance policy, interest from corporate bond and debentures. | Form 15H can be usedto avoid TDS on the interest generated from fixed deposits, from corporate bonds, post office, on EPF withdrawal, rent. |
| Benefits | This form helps individuals below 60 years to avoid TDS deductions from interest income in a financial year. It cannot be filled by NRIs | This form helps individuals above 60 years to avoid TDS deductions from interest income in a financial year. It cannot be filled by NRIs |
| Issued Against | This form is issued against a Fixed deposit holder having an age of below 60 years. | This form is issued against the Fixed deposit holder and Recurring deposit holder aged 60 years or above. |
| Issuer | All major banks of India and the Income Tax Department issue Form 15G. | All major banks of India and the Income Tax Department issue Form 15G. |
Below mentioned are some common TDS Sections
| Investment Type | Sections of Income Tax Act | Threshold limit | TDS (with Valid PAN) | TDS without PAN |
| Interest on Bank Deposits | 194A | 10,000 | 10% | 20% |
| EPF Proceeds- Premature Withdrawal | 192A | 30,000 | 10% | 30% |
| Interest on securities | 193 | – | 10% | 20% |
| Dividend income | 194 | 2,500 | 10% | 20% |
| Interest other than interest on securities | 194A | 5,000 | 10% | 20% |
When you invest in FDs, the TDS is deducted from the interest that you earn if it is over ₹40,000 for non-senior citizens (₹50,000 for senior citizens). However, you can avoid it by submitting Form 15G or Form 15H to the bank. However, you need to ensure zero tax on your total income. This article is a detailed guide on Form 15G and 15H, wherein you also understand how to fill Form 15G and Form 15H.
Who is eligible for 15G?
Individuals who are below 60 years of age and whose tax liability on total income is zero are eligible to submit Form 15G. Moreover, only resident Indians are eligible. NRIs (Non-Resident Individuals) cannot submit Form 15G.
Who is eligible for 15H?
Individuals whose tax on total income is zero and are adobe 60 years of age are eligible to submit Form 15H. NRIs cannot submit Form 15H.
How to Fill Form 15G for PF Withdrawal?
What is the income limit for TDS on bank FDs?
The interest income limit for TDS ₹40,000 for non-senior citizens and ₹50,000 for senior citizens. Non-senior citizens have to fill form 15G and senior citizens will have to fill 15H to avoid TDs deduction.
How to fill form 15G to avoid TDS on Interest income?
Here are the steps on how to avoid TDS on interest income using Form 15G:
How to fill form 15G to avoid TDS on Interest income?
To avoid TDS on interest income, you must submit Form 15H to the payer of interest income before the interest is credited to your account. The form must be filled in correctly and signed by you. You must also enclose a copy of your PAN card with the form.
Here are the steps on how to avoid TDS on interest income using Form 15H:
Is it mandatory to submit Form 15G and Form 15H to the income tax department?
You do not need to submit Form 15G and Form 15H directly to the Income Tax Department. You can submit it to the deductor to avoid TDS deduction subject to conditions.
Will my interest income be tax-free if I submit 15G and 15H?
No, submitting Form 15G/Form 15H will not make your interest income tax-free. Interest income from fixed deposits and recurring deposits is taxable. However, senior citizens are eligible for a deduction of Rs.50,000 on interest income from fixed deposits, post office deposits, and deposits held in cooperative societies under section 80TTB. You should only submit Form 15G/Form 15H if your tax liability on your total income is zero, along with other conditions.
