Submit Forms 15G, 15H for Fixed Deposit Investments to avoid TDS

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Form 15G and Form 15H are submitted to prevent banks from deducting TDS on the interest earned on a Fixed Deposit (FD) if the total interest income is not more than the prescribed limit. Although Fixed Deposits maybe the safest form of investments, they are not immune from tax deductions at the source. Basically a fixed deposit will pay out the interest upon maturity and if the interest earned through such fixed deposits crosses Rs. 10,000 for regular deposit holders and Rs.50,000 for senior citizens, the bank will deduct TDS. To avoid this, a depositor will have to file the 15G & 15H forms at the start of the fiscal year with the bank itself. With the simplification of this process in place, investors can now file these forms electronically and avoid the hassles that come with filing forms physically.

When to submit form 15G: If the total interest income earned from fixed deposits is less than the prescribed limit of Rs.10,000 in a given financial year, form 15G for fixed deposit will have to be submitted.

When to submit form 15H: In case the total income earned is less than the given limit of Rs.50,000 for senior citizens, in a particular financial year,  form 15H will have to be submitted.

Let us now take an example and understand how to fill and submit form 15G & 15H in SBI:

• Log on to the SBI internet banking portal and login with credentials
• Click on the ‘e-Services’ portal and then proceed to tap the ‘Submit 15G/15H’ option
• There will be both the forms displayed. For example, if you want to submit form 15G in SBI, click on the same
• Then fill in details and click on ‘Submit’

Process of filing Form 15G & 15H

Now let us understand how to fill form 15G & 15H for fixed deposits:

• The forms can be submitted in its physical form
• The forms can also be filed electronically upon which the investor will receive a UIN or Unique Identification Number.If an investor has multiple deposits across different branches of the same bank or different banks, they will still need to submit these forms at each branch ideally before the first interest instalment has been paid.
• In cases of delay, the bank will deduct the TDS but will provide TDS certificate towards the end of the year.

Criteria for Submission of Form 15G & 15H

• The tax forms to be submitted for fixed deposits also depend on the investor and the bank.
• If the investor has crossed the age of 60 years, then he/she will have to file form 15H
• If the investor is below the age of 60, or is a trust or is a Hindu Undivided Family then they will have to file form 15G.
• These forms cannot be filed by non-resident individual account holders or companies
• The age limit set is dependent on the Bank criteria and cannot be considered as a format applicable for all banks as each bank may have a different cut off criteria

Documents required

Banks also deduct TDS from fixed deposits based on the documents submitted by the investor. Usually any FD generating interest higher than RS 10,000 will have a 10% TDS deducted at the source, however if the investor has not given the bank their PAN number, then the TDS deducted for FD’s generating more than RS 10,000 in interest will see a 20% deduction at the source. Hence it is imperative that the investor provides the correct PAN number while filing these forms. Along with the correct PAN number, investors will have to furnish other details such as telephone numbers, email ID’s, occupation and complete addresses along with details of income from other sources. These could be other investments, dividends from Shares, mutual funds or any money withdrawn from National Savings Schemes.

Number of Copies required

Duplicate copies of the declaration will have to be submitted to the banks. While some banks require only two copies, other banks will take three and provide one copy to the investor as an acknowledgement. It is the duty of the investor to verify the information furnished in the declarations before signing it. Investors making false statements will be liable for prosecution under the aegis of Section 277 of the Income Tax act of 1961.

Tax Refund Claims by Submitting Form 15G & 15H

Banks deduct TDS on only those deposits that generate interest higher than the prescribed limit. In any case of banks deducting TDS for such deposits even after the investor has submitted the required forms 15G and 15H, then they can file income-tax returns at the end of the financial year and can claim a refund.