In the maze of tax regulations, there’s a beacon of hope for taxpayers seeking to minimise their tax deductions on interest income: Forms 15G and 15H. As the new financial year unfurls its canvas, understanding the intricacies of these forms becomes paramount.
Dr. Suresh Surana, Founder of RSM India, sheds light on the significance of these self-declaration forms. ‘Forms 15G and 15H serve as lifelines for taxpayers aiming to ward off TDS deductions if their estimated tax liability for the fiscal year stands at nil,’ he emphasises.
The crux lies in Section 194A of the Income Tax Act, 1961, mandating banks to levy TDS if interest income surpasses ₹ 40,000 annually (₹ 50,000 for senior citizens). However, with the strategic submission of Form 15G or 15H, taxpayers can steer clear of TDS deductions.
Submitting these forms is a breeze, either through online channels or physically at the bank. But here’s the catch—they’re valid for a single financial year and necessitate annual renewal.
So, who’s eligible to wield these forms? Form 15G extends its embrace to resident individuals under 60, Hindu Undivided Families (HUFs), and certain trusts. Meanwhile, Form 15H extends its grace to senior citizens, aged 60 or above.
Timing is crucial. Ideally, submission should precede the onset of the financial year or the first income payment subject to TDS. Nevertheless, they can be tendered at any point within the fiscal year.
But heed this caution: delay could mean locking up funds unnecessarily. ‘Submitting forms well in advance ensures a seamless flow of income without TDS deductions,’ advises Dr. Surana.
In the risk of tax compliance, Forms 15G and 15H emerge as beacons of financial prudence, offering taxpayers a pathway to preserve their hard-earned income from unnecessary deductions.
