In such a situation, you have no choice but to take the refund route.įorm 15H can be only filed by individuals above 60 years of age or someone who or completes 60 years during the financial year. You might invest Rs 1.5 lakh in PPF and be out of the tax net but you are not eligible for Form 15G as, though your tax liability is zero, the interest income is higher than the basic exemption. Say, your income is Rs 4 lakh, of which Rs 3 lakh is earned as interest from bank.
Meaning, even if the interest income is less than the basic exemption allowed during that financial year, if your if your total tax liability is not nil, you will not be eligible for Form 15G. If these criteria are met, you may submit Form 15G and the entire interest income would be credited without any tax cut.Īn important thing to note here is that you need to meet both the criteria. Here are the points to check before you file for an exemption on TDS to avoid penalty.Įligibility Criteria: The basic two conditions for filing 15G are -one, the final tax on his estimated total income computed as per the provisions of the Income Tax Act should be nil and two, the aggregate of the interest (excluding interest earned on securities) received during the financial year should not exceed the basic exemption slab which is Rs 2.5 lakh. The term can be extended up to seven years and with fine, where tax sought to be evaded exceeds '25 lakh,' says Sudhir Kaushik, CA and CFO, Taxspanner. "Prosecution includes imprisonment which may range from three months to two years along with fine.
The rules, however, are not so simple and you need to know the intricacies of the law as the repercussion of wrong filing is stiff.Ī false or wrong declaration in Form 15G attracts penalty under Section 277 of the Income Tax Act. While Form 15G is for individuals below 60 years, HUFs and trusts, Form 15H is for individuals above 60 years of age.Īlso, the above declaration can be submitted only by a person who is an Indian resident. However, you can submit a declaration Form 15G and 15H to avoid TDS on interest income. If you do not furnish your PAN details, the TDS rate will be higher at 20%. There are rules and conditions you should be aware of.Īccording to the tax rules, if your interest income exceeds Rs 10,000 in a year, the bank should deduct a 10% tax at source, or TDS. However, you cannot randomly submit these two forms. Investment declaration is more or less a straightforward exercise. Two basic steps: submitting investment declaration with your employer on time and filling form 15G and 15H will save you from half the hassles. That is why you are advised to plan your taxes at the beginning of the year-to avoid overpayment and escape the refund process. Moreover, the I-T department is famous for delays and the wait sometimes is frustrating.
FORM 15G IN WORD FORMAT GENERATOR
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