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These forms can be useful tools to avoid TDS deductions. However, for their submission, it's essential to fulfil the following conditions:
a. Eligibility criteria: Form 15G can be submitted by individuals and Hindu undivided families (HUFs) below the age of 60 years. On the other hand, Form 15H applies to individuals who are over the age of 60.
b. Taxable income limit: The total estimated income for the financial year should be below the taxable threshold, which is subject to change as per the prevailing tax laws.
c. Valid PAN: The person submitting the form must have a valid Permanent Account Number (PAN).
d. Nature of income: These forms apply to interest income from savings accounts, fixed deposits, recurring deposits, etc., but not to salaries or business or professional income.
1. Submission process: These forms can be submitted to the respective financial institution or payer who deducts TDS, such as banks, post offices, or companies.
2. Validity period: The declaration made in these forms is valid for the financial year in which they are submitted. Therefore, individuals need to submit a new form each financial year to avail themselves of the benefit of non-deduction of TDS.
TDS is a mechanism through which the government collects taxes at the time of income generation. When a person's income exceeds the taxable threshold, the payer deducts a specific percentage of the tax before making the payment. However, by submitting Forms 15G and 15H, individuals can request the payer not to deduct TDS based on their eligibility.
Despite submitting Forms 15G and 15H, certain situations may still result in TDS deductions. These are given below:
a. Incorrect information: Providing incorrect or false information in these forms can lead to TDS deductions and potential legal consequences.
b. Taxable income crossing the threshold: If the actual taxable income exceeds the limit specified in the form, the TDS will be deducted accordingly.
c. Multiple payers: If one has multiple sources of income and the total taxable income exceeds the threshold, TDS may be deducted by other payers who are not aware of the submissions made using Forms 15G and 15H.
d. Non-filing of Forms 15G and 15H: Failure to submit these Forms where applicable can result in TDS deductions as per regular tax provisions.