Form 15H is a self-declaration form submitted by resident senior citizens (individuals aged 60 years or more) to banks and other financial institutions requesting that no Tax Deducted at Source (TDS) be deducted from their interest income because their total income is below the basic exemption limit.
Requirement
for Submitting Form 15H:
A
resident senior citizen can submit Form 15H if they meet all the
following conditions:
- Resident Indian: The individual must be a resident in India. Non-residents
cannot claim the benefits of Form 15H.
- Age 60 Years or More: The individual must have completed 60 years of age
during the previous financial year.
- No Tax Liability: The tax calculated on the total income of the senior
citizen for the financial year must be Nil.
- PAN is Compulsory: Providing your Permanent Account Number (PAN) is
mandatory for submitting Form 15H.
- Interest Income Threshold
(Bank/Co-operative Society/Post Office):
Banks are required to deduct TDS under section 194A of the Income Tax Act
when your interest income from them is more than a specified threshold in
a financial year. The bank aggregates the interest on deposits held in all
its branches to calculate this limit.
- Present Limit (as of writing): ₹50,000 for senior citizens when the payer is a bank,
co-operative society, or post office.
- Proposed Limit (Budget 2025): ₹1,00,000 for senior citizens when the payer is a
bank, co-operative society, or post office.
Important
Note: Even if your interest income
exceeds the TDS threshold, you can still submit Form 15H if your total income
for the financial year (including this interest income) is below the basic
exemption limit, and your tax liability is Nil. For Form 15H, the condition
of interest income being less than the basic exemption limit is NOT mandatory.
Basic
Exemption Limits for Financial Year 2024-25 (Assessment Year 2025-26):
- ₹3,00,000 under both the old
and new tax regimes for senior citizens (aged 60 years or more).
How
to Ensure No TDS Deduction if Total Income is Not Taxable:
The
primary way to ensure that banks do not deduct TDS on your interest income when
your total income is not taxable is by submitting Form 15H.
- Submit Form 15H: By submitting this declaration, you inform the bank
that your total income for the financial year will be below the basic
exemption limit, and therefore, no tax should be deducted at source from
your interest income.
- Provide PAN: Ensure you provide your valid PAN while submitting the
form.
- Submit Annually: Form 15H is valid for one financial year. Therefore,
it needs to be submitted at the beginning of each financial year.
Many banks also provide the facility to submit these forms online through
their website or mobile applications.
Advantages
of Submitting Form 15H:
- Avoids Unnecessary TDS: Prevents deduction of tax at source when your income
is below the taxable limit, keeping your funds readily available.
- Improved Cash Flow: Provides better liquidity throughout the financial
year.
- Reduced Compliance Burden: Eliminates the need to claim TDS refunds by filing
your income tax return.
Limitations
of Form 15H:
- Only for Resident Senior
Citizens: Non-Resident Indians (NRIs)
and individuals below 60 years of age cannot submit this form.
- Primarily for Interest Income: While designed for interest income, similar
declarations might exist for other income types.
- Total Tax Liability Must Be
Nil: The fundamental condition is
that your estimated total tax liability for the financial year must be
Nil.
- Separate Forms for Each
Institution: A separate Form 15H is
required for each bank or financial institution where you hold deposits.
- Potential Penalties for False
Declaration: Submitting a false declaration
can attract penalties under the Income Tax Act.
- Subject to Rule Changes: Income tax rules and regulations, including those
related to Form 15H, can be amended by the government.
Last
Date for Submitting Form 15H as per the Income Tax Act, 1961:
The
Income Tax Act, 1961 does not prescribe a specific "last date"
for submitting Form 15H.
The
practical deadline is determined by the timing of interest credit or payment by
the bank or financial institution.
- To avoid TDS deduction on any
particular interest payment, the form should be submitted before
the interest is credited or paid.
- It is best practice to submit
Form 15H at the start of the financial year (April) to cover all
expected interest income for the entire year.
- If you make a new deposit or
realize that your income will remain below the taxable limit later in the
year, you can still submit the form, and it will be effective for
subsequent interest credits/payments.
What
if You Forget to Submit Form 15H?
If
you forget to submit Form 15H, and TDS has already been deducted, you have the
following options:
- File Your Income Tax Return: The only way to claim a refund of the excess TDS
deducted is by filing your income tax return. The Income Tax Department
will process your return and issue a refund if applicable. Banks cannot
directly refund the TDS once it has been deposited with the government.
- Submit Form 15H Immediately: If TDS deduction happens quarterly, submitting Form
15H as soon as you realize your oversight can prevent further TDS
deductions for the remaining quarters of the financial year.
Example
to Understand Who Can Submit Form 15G and Form 15H (as provided):
|
Particulars |
Age 50 years |
Age 21 years |
Age 65 years |
Age 68 years |
|
Salary |
₹ 1,80,000 |
- |
- |
- |
|
Pension |
- |
- |
₹ 1,00,000 |
- |
|
FD interest income |
₹ 85,000 |
₹ 2,60,000 |
₹ 1,80,000 |
₹ 3,30,000 |
|
Total
income before Sec 80 |
₹
2,65,000 |
₹
2,60,000 |
₹
2,80,000 |
₹
3,30,000 |
|
Deductions under Section 80 |
₹ 45,000 |
₹ 30,000 |
₹ 10,000 |
₹ 55,000 |
|
Taxable
income |
₹
2,20,000 |
₹
2,30,000 |
₹
2,70,000 |
₹
2,75,000 |
|
Basic Exemption limit (FY 24-25) |
₹ 2,50,000 |
₹ 2,50,000 |
₹ 3,00,000 |
₹ 3,00,000 |
|
Age |
< 60 years |
< 60 years |
> 60 years |
> 60 years |
|
Tax on total income is Nil |
Yes |
Yes |
Yes |
Yes |
|
Interest income < Exemption
Limit |
Yes |
No |
N.A. |
N.A. |
|
Eligible
to submit Form |
Yes,
Form 15G |
Cannot
submit |
Yes,
Form 15H |
Yes,
Form 15H |
Key
Takeaways:
- Form 15H is specifically for resident
senior citizens.
- The primary condition for
submitting Form 15H is that the tax calculated on your total income is
Nil.
- Unlike Form 15G, for Form 15H,
the interest income can be more than the basic exemption limit, as
long as the total taxable income (after deductions) remains below the
exemption limit, resulting in zero tax liability.
- Submit Form 15H at the
beginning of each financial year to avoid TDS deductions on your
interest income.
