What is Form 15G/15H?
Form 15G/ 15H is used to make sure that TDS is not deducted from your income if you meet certain conditions as mentioned below. You can submit these forms to the deductor who deducts TDS on your income.
The best use case is that of Banks. Banks deduct TDS @ 10% if your interest income from deposits exceeds INR 10,000 (INR 50,000 in the case of senior citizens). If your total income is not taxable then you can submit the Form 15G /15H to banks so that they don’t deduct TDS from your interest income. Some of the banks provide the facility to upload Forms online through their website as well.
Form 15H is for senior citizens who are 60 years or elder and Form 15G is for a non-senior citizen. It is to be filed every financial year at the beginning of the year.
What are the conditions for filing Form 15G/ 15H?
Below are the conditions for filing Form 15G:
- Your age is less than 60 years,
- You are a Resident Individual or HUF,
- Tax Calculated on your Total Income is zero,
- Total Interest income is less than the basic exemption limit of that particular year.
The conditions for filing Form 15H are the same as above except the condition that their age should be of 60 years or above.
| Age of the individual | Basic Exemption Limit (INR) |
|---|---|
| Below 60 | 2,50,000 |
| Between 60 and 80 | 3,00,000 |
| More than 80 | 5,00,000 |
Let’s take an example to understand better:
|
Particulars |
Anjana |
Rahul |
Gautam |
Pravin |
|
Age |
25 |
50 |
70 |
65 |
|
Residential Status |
Resident of India |
Resident of India |
Non-Resident of India |
Resident of India |
|
Salary Income / Pension Income |
2,70,000 |
0 |
0 |
1,50,000 |
|
Interest Income |
10,000 |
2,60,000 |
85,000 |
20,000 |
|
Total Income |
2,80,000 |
2,60,000 |
85,000 |
1,70,000 |
|
Deduction under Section 80 |
40,000 |
50,000 |
0 |
0 |
|
Total Taxable Income |
2,40,000 |
2,10,000 |
85,000 |
1,70,000 |
|
Basic Exemption Limit |
2,50,000 |
2,50,000 |
3,00,000 |
3,00,000 |
|
Form 15G/15H eligibility |
Yes |
No |
No |
Yes |
|
Reason |
Anjana can submit Form 15G Since the tax calculated is zero and interest income is less than the basic exemption limit |
Rahul cannot file Form 15G. Even Though the tax calculated is zero because his interest income exceeds the basic exemption limit (INR 2,50,000) |
Gautam cannot file Form 15H since he is not a resident Indian |
Pravin can file Form 15H since his tax calculated is zero and interest income is less than the basic exemption limit (INR 3,00,000) |
How to file Form 15G & Form 15H?
Form 15G/ Form 15H is used to make sure that TDS is not deducted from your income. If your tax liability for a year is zero then you can file these forms with the deductor. These can be filed in the following two manners:
1. Physical Submission
- You can Download Form 15G/ 15H
- Fill the form and submit it to the deductor in paper form.
2. Online Submission
- Go to the website of the deductor i.e, Bank’s website.
- Log in to your account,
- Fill the Form 15G/ 15H and submit.
Details required
- PAN
- Residential Status
- Address Details
- Contact Information
- Estimated Income Details
- Previously Filed Form 15G/ 15H Details
When should Form 15G / Form 15H be submitted?
The forms should be submitted for the following income source when TDS is deducted on:
- EPF withdrawal: TDS is deducted when you withdraw from the EPF account before 5 years of continuous services. So if you have not completed 5 years of service and you are planning to withdraw your EPF balance for more than INR 50,000 (Effective from 1st June 2016. Earlier the limit was INR 30,000), you can save yourself from TDS by submitting Form 15G /15H.
- Rent: If your rental income for a year exceeds INR 2,40,000 (INR 1,80,000 till FY 2018-19), TDS is deducted by the tenant. However, if your total income including rent is not taxable then you can submit Form 15G / 15H to the tenant to save yourself from TDS deduction.
- Interest income from FDs with Banks / Post office: If your total income including the interest from deposits is not taxable, you can submit Form 15G / 15H to the Banks /Post office, requesting them not to deduct the TDS from your interest income.
- Corporate Bonds: If your interest income from corporate bonds is more than INR 5000 then TDS is to be deducted from the same. You can submit form 15G / 15H to the issuer asking him not to deduct the TDS.
- Insurance Commission: Earlier if the insurance commission earned by the agent exceeded Rs. 15,000 then TDS used to get deducted from it. But from FY 2017-18 insurance agents can also submit Form 15G/ 15H for non-deduction of TDS if the tax on their total income is zero.
- Dividend Income: Earlier there was no TDS on Dividend Income due to DDT (Dividend Distribution Tax). But from FY 2020-21, TDS @ 10% will be deducted on dividend income if it is more than INR 5,000. However, a trader can submit Form 15G/ 15H for non-deduction of TDS if the tax on their total income is zero.
FAQs
Yes, you will have to submit Form 15G / 15H to all the bank branches where you have deposits.
No. Form 15G / 15H can only be filed by an Indian Resident.
Yes. If the HUF meets all the conditions mentioned above, then it can submit Form 15G / 15H to the deductors.
No. Submission of Form 15G/ 15H does not mean that your income is tax-free. It only means no TDS will be deducted on such income by the deductor. You still need to show the same as income while filing your ITR.
Form 15G/15H needs to be submitted at the beginning of the financial year. Thus the deductor shall not deduct TDS while filing quarterly TDS returns during the year.
Any resident Individual/HUF who is not a senior citizen can file Form 15G to the deductor if their total income is less than INR 2,50,000.
Any resident Individual/HUF being a senior citizen can file Form 15H to the deductor if their total income is less than INR 2,50,000.
Hey @TeamQuicko
Thanks for the blog! Just one quick question - Why do we have to report a quarterly breakdown of Dividend Income under IFOS?
Thank you!
Hey @TanyaChopra
This quarterly breakdown of Dividend Income under IFOS will help to calculate and determine penalty u/s 234C for the delay in payment of Advance Tax.
Hope this helps!
I had received dividend recently but I had noticed that TDS had been deducted. any idea as to why has it happened and is there a way I can claim this TDS?
Hey @HarshitShah
After the introduction of Budget 2020, dividend income is now taxable in the hands of the shareholder; and is also subject to TDS at 10% in excess of INR 5000 u/s 194 & 194K. Foreign Dividend is taxable at slab rates. TDS is not applicable to such dividends. The taxpayer should report such income under the head IFOS in the ITR filed on the Income Tax Website.
Hope this helps!
Hey @HarishMehta
Yes, dividend income is now taxable from FY 2021-22 onwards and it has to be reported under the head of IFOS.
You can read more about it here:
Hi @Maulik_Padh,
You need to pay Income tax on the net taxable income, i.e. after subtracting deductions, expenses, etc.
If the net taxable income is negative i.e. if there is loss, you can carry it forward when filing the ITR
Here are some of the articles which might help
Hi @ameyj
The amount of TDS deducted shall reflect in your Form 26AS only and it will also reflect the name of the deductor.
Using the name of the deductor you can find out on which share you have received the dividend and you can also cross-check the same in your bank statement.
Yes, you are right, TDS is to be deducted when the dividend paid exceeds 5000 INR in a financial year. However, the 5,000 INR limit pertains to all the dividends an individual gets in a year, or the total dividend per shareholder that a company pays out in a year, is left to interpretation, and hence registrars and share transfer agents (RTA) are not taking any chances and are deducting TDS even on small amounts.
Hope this helps
Hi @ameyj
You can submit a grievance on Income Tax Portal mentioning the issue and also attach the 26AS.
The other option is to leave it as it is and clarify it when the tax department sends the notice.
Hi @TeamQuicko
Consider that I have 10 shares each of 10 different Indian companies. Each of the 10 companies are declaring a dividend of INR 100 before the FY ends. Now I will be recieving 1000 as dividend from each company, thereby a total of 10,000.
The 5,000 dividend limit, is it applicable to each company / total dividend recieved by me in a year. If it is applicable to each company, then I would not attract TDS of 10% for dividend.
Also pl clarify, how would the company B know that I have got shares of Company A,C,D,E so on…
@Saad_C @Laxmi_Navlani @Divya_Singhvi @Kaushal_Soni @AkashJhaveri can you help with this?