Avoid TDS on FD: You can avoid tax deduction/TDS on your interest income if you are an individual, who is resident in India by furnishing, a declaration in writing in Form 15G/15H. You can only submit form 15G or 15H if your income is below the exemption limit. There are some provisions to submit 15H or 15G to avoid TDS in the case of fixed deposit as follows:
First of all, you need to understand that tax has to be deducted at source by banks on your FD interest. The bank will deduct TDS on interest paid or credited on your fixed deposits. In order to save tax, you need to submit Form 15G & 15H to the bank.
Form 15G or Form 15H?
These forms can be submitted to avoid TDS on FD as per the payee age status as follows;
|Assessee Status||Form No.|
|Senior Citizen||Form No.15H|
|Other than Senior Citizen||Form No.15G|
Additional Notes (Form 15G/15H)
- The declaration in Form No.15G/15H can only be made by an individual resident in India.
- You can only make the declaration in Form No.15G or 15H if your annual FD interest does not exceed the exemption limit (i.e. Rs. 2,50,000 Rs. 3,00,000 or Rs. 5,00,000, as the case may be).
- A senior citizen can furnish a declaration in form 15H even if annual FD interest likely to be paid to him exceeds the exemption limit of Rs.2,50,000/- or Rs.5,00,000/- as the case may be, provided the tax payable on his total income after considering the rebate u/s 87A is nil.
- The tax payable on the total income of the year should be Nil.
So by considering above points you can avoid TDS on your FD interest.
The payer or bank who receives the declaration in Form NO.15G/15H will upload the form 15H or 15G with a digital signature within:
- 15 days from the end of the first, second and third quarter
- 30 days from the end of the fourth quarter.
FAQ on 15G & 15H to Avoid TDS on FD
Q. Who need to submit form 15G and 15H to avoid TDS on FD?
A. Form 15H need to be submitted by a senior citizen (age above 60 years) and Form 15G needs to be submitted by individuals other than a senior citizen.
Q. What is the validity of forms 15G & 15H?
A. Validity of the forms is a single financial year.
Q. What is the proof I have submitted the 15G & 15H form I have submitted at the bank?
A. Banker would issue an acknowledgement statement to the submitter, also bank issue form 16A stating the deduction of TDS.
Q. What if an Individual miss to submit form 15G & 15H to the bank and TDS was deducted, but my income is non-taxable; how can one get my money back?
A.One need not worry you are eligible for a tax refund from the government. An individual needs to submit the 16A form received from the bank while filing tax.