Money plays a huge role in our lives, dictating terms and providing a pathway for our life to unfold. While earning money is a hard task in itself, earning money after you reach a certain age can be challenging. A majority of us opt for investments during our prime years to ensure that our retirement stage can be peaceful, but failure to utilise certain tools could see you paying a chunk of your money towards taxes, both during work life and post retirement.
What is Form 15H?
Form 15H is an ideal tool for individuals well versed with the income tax procedure in our country. The income tax department provides a number of ways for people to save tax and this form can go a long way in reducing the amount you pay as tax. In essence, this is a self-declaration form which says that an individual is not liable for TDS in terms of certain investments. A tax assessee can use this form to communicate with the income tax department that he/she is eligible for zero or reduced TDS in terms of interest earned through certain deposits.
When to use Form 15H?
Form 15H should be used when you have an income from deposits (interest component). Failure to submit this form could result in TDS on this interest component and it is advised to use this form every financial year, when the interest earned on investments reaches a certain limit.
Who can submit Form 15H?
Form 15H is specifically designed to cater to a particular population of the society. Individuals who wish to save TDS on interest earned from certain investments can submit form 15H, subject to them meeting the following eligibility criteria.
- Indian resident – An individual should be a resident of India in order to use this provision. NRIs cannot submit this form.
- Age – Form 15H is designed for senior citizens only, i.e. an individual should be over the age of 60 years in order to use this form.
- Tax component – An individual should have zero tax liability after computing the final tax on the basis of his/her estimated income.
- Individual – Only individuals can use this form. Organisations or companies cannot submit form 15H.
- Interest aggregate – The overall aggregate of the interest earned through different sources in a particular financial year should be under the limits set in the income tax slab.
Form 15H Example:
Mr.Dube, aged 65 years has an income of Rs 2.5 lakh through the interest on various deposits in a particular year. He also has an income of Rs 2 lakh from other sources, taking his overall income to Rs 4.5 lakh. He is eligible for deductions amounting to Rs 1.5 lakh, making his total taxable income Rs 3 lakh. Under the provisions of the IT slab, he is eligible to use Form 15H as his net taxable income is under the prescribed limit.
Components of Form 15H:
Form 15H consists of two parts, each equally important towards achieving its purpose. The form is simple to understand and fill, with Part 1 containing the following elements.
- Name of individual claiming relief
- Details of investment
- The amount invested
- Date of investing
- An estimate of the amount which one can receive
- Age and occupation of individual
- Last assessment year
Part 2 of the form consists of the following elements.
- Name and address of individual
- Period in which dividend was credited
- Interest rate on investment
Things to remember while filling Form 15H:
An individual filling and submitting this form should keep the following points in mind.
- Check eligibility – if you can use this form
- Ensure all details are entered correctly, as misleading/incorrect information could create issues later
- Mention the right assessment year in the form
- Try to get the right estimate of expected income
- Only fill Part 1 of the form. Part 2 should not be filled you
- This form is not a replacement for your income tax return and you need to file it separately
- Don’t forget to take an acknowledgment after submitting this form
- Ensure you provide your PAN details
- Where should you submit Form 15H?
- For how long is Form 15H valid?
In a bid to simplify the entire process, an individual need not go to the income tax office to submit this form. These forms can be submitted either to your bank or a post office.
An individual can use Form 15H only for a particular assessment year. This form is valid for 1 financial year only and a person will have to use a new form for different assessment years.