Difference Between Form 15G and Form 15H

You check your bank account for your full interest payout, but a part of it is missing. You are confused and you call your bank, and they say, "Sir, TDS has been deducted." But you didn’t even cross the taxable income limit! So how did this happen? 

Well, this happens to many people who aren’t aware of Form 15G and Form 15H. These are two simple forms that can prevent Tax Deducted at Source (TDS) on your interest earnings. Submitting the right form on time helps you save more money instead of waiting for a refund. 

So, which form should you submit? When? And how does this fit into your tax saving strategy? Let’s break it down in the simplest way possible. 

Understanding Form 15G and 15H 

To avoid TDS on interest income, the Income Tax Department issues self-declaration forms 15G and 15H. They do, however, serve a range of age and income brackets. Let’s understand each one. 

Form 15G is a self-declaration form that helps taxpayers below 60 years. Additionally, it helps Hindu Undivided Families (HUFs) prevent TDS deductions on interest income from: 

• Fixed deposits 

• Recurring deposits 

• Rental income 

• Other passive earnings 

In simple terms, you can submit Form 15G if: 

• Your total income for the financial year is below ₹2.5 lakh. 

• You are under 60 years old and an Indian resident. 

• You have zero tax liability. 

• Hindu Undivided Families (HUFs) with an annual income below ₹2.5 lakh can also apply. 

Let’s understand with an example. Sneha is a 35-year-old IT professional. She earns ₹2.4 lakh annually, including ₹50,000 as FD interest. Since her total income is below the taxable limit of ₹2.5 lakh, she can submit Form 15G to ensure her bank does not deduct TDS on his interest earnings. 

On the other hand, Form 15H serves the same purpose. However, it is exclusively for senior citizens (60+ years) who are Indian residents. It ensures that banks do not deduct TDS from their interest income. 

In simple terms, you can submit Form 15H if: 

• You are 60+. 

• You are an Indian resident. 

• Your total taxable income for the financial year is zero. 

This means, if your income is below ₹5 lakh, you can qualify for a full rebate under Section 87A. In that case, you can submit Form 15H. This helps you avoid TDS deductions on your interest earnings. 

For example, Mr. Goswami is a 65-year-old retiree. He earns ₹4.5 lakh from FD interest. Since his total income is below the ₹5 lakh, he can submit Form 15H to avoid TDS deductions. 

Key Differences Between Form 15G and 15H 

Aspect	Form 15G	Form 15H
Eligibility	It is available for individuals below 60 years and Hindu Undivided Families (HUFs).	Exclusively for senior citizens (60 years and above).
Taxable Income Limit	Total income, including interest, should be below ₹2.5 lakh (basic exemption limit).	Total income should be below ₹5 lakh (basic exemption limit).
Purpose	To avail tax benefits and prevent TDS deduction for individuals below 60 years.	To ensure senior citizens get tax benefits on interest earnings by avoiding TDS.

When to Submit Form 15G or 15H 

It's advisable to submit these forms at the beginning of the financial year to avoid any TDS deductions from the start. However, you can submit them anytime during the year to prevent further deductions. 

Both forms are valid for one financial year, so you need to resubmit them each year to continue receiving the benefits. 

How to Fill and Submit Forms 15G and 15H 

Here's a step-by-step guide: 

• Download the Form: 

You can download Forms 15G and 15H from the Income Tax Department's website or get them from your bank's website. 

• Fill in Details: 

Include your name, PAN number, residential status, and contact details. You'll also need to declare your estimated income for the year. And will need to specify the accounts for which you're claiming TDS exemption. 

• Submit the Form: 

Submit the form online or take the filled form to your bank or financial institution where you have deposits. Ensure you submit it to all branches where you have interest-bearing accounts. 

• Attach PAN Card Copy: 

Always attach a copy of your PAN card for verification purposes. 

Important Points to Remember 

• Make sure you submit the form separately to each deductor (bank, tenant, post office, bond issuer, etc.). 

• Submit a fresh form every financial year.  

• Ensure your PAN is updated with all deductors. If you miss this, it can result in higher TDS deductions (20% as per Section 206AA of the Income Tax Act.) 

Conclusion 

Choosing between Form 15G and 15H is simple based on your age and taxable income. By submitting the correct form, you can reduce TDS deductions and save more on taxes. 

Not having any applicable TDS on your income doesn’t mean you don’t have to pay tax. If your total income is taxable, you must file an Income Tax Return (ITR) and pay the required tax. Stay informed, act wisely, and take full advantage of tax saving opportunities!