When it comes to managing your taxes efficiently, understanding the provisions related to Tax Deducted at Source (TDS) is crucial. For individuals who earn interest income or other forms of income where TDS might apply, Form 15G and Form 15H act as key tools to help avoid unnecessary tax deductions. These forms are not just paperwork—they’re safeguards that ensure your hard-earned money isn’t deducted unnecessarily by banks, post offices, or other deductors.

In this blog, we’ll walk you through the important guidelines, eligibility criteria, and key considerations for Form 15G and Form 15H for the financial year 2025-26.

Ø     WHAT IS FORM 15G?

Form 15G is a self-declaration form that individuals can submit to the deductor (like banks or financial institutions) requesting non-deduction of TDS on their interest income. This is applicable to individuals whose taxable income is below the basic exemption limit, meaning their overall tax liability for the financial year is nil.

This form is governed under Section 197A (1A), 197A (1C) of The Income Tax Act and Rule 29C of the Income Tax Rules, providing a legal framework for individuals to claim exemption from TDS on interest income, dividends, and other similar incomes.

Ø    RELEVANT LEGAL PROVISIONS

1. Section 197A (1A)

This section states that no tax will be deducted at source (TDS) for individuals (other than companies or firms) if they submit a written declaration in duplicate, in the prescribed format, stating that their estimated total income for the previous year will be nil. This applies to incomes covered under sections like 192A, 193, 194A, 194D, 194DA, 194-I, and 194K.

2. Section 197A (1C)

Similar to Section 197A (1A), this provision applies to resident individuals aged 60 years or older. If they submit a declaration in duplicate, as prescribed, confirming that their estimated total income will be nil for the previous year, no TDS will be deducted on income under specified sections.

3. Rule 29C

The rule outlines the procedure for making declarations in Form 15G and 15H. It states that the declaration mentioned under Section 197(1)(1A) (for individuals) is to be submitted in Form 15G and that mentioned under Section 197(1)(1C) (for senior citizens) is to be submitted in Form 15H. 

Ø    WHO CAN SUBMIT FORM 15G?

Form 15G is available for resident individuals, Hindu Undivided Families (HUFs), and Associations of persons (AOPs).

• Note: Non-residents (NRIs) are not eligible to submit this form.

Ø  ELIGIBILITY CRITERIA FOR FORM 15G

• The individual must be a resident in India.

• The individual must have a valid PAN (Permanent Account Number) 

• The total income for the financial year should be below the basic exemption limit (₹4,00,000 for individuals opting for the new tax regime).

• The tax payable on the total income must be nil after considering deductions under Chapter VI-A (like 80C, 80D) or losses from house property.

It’s essential to remember that even if your total income exceeds the exemption limit but your tax liability is nil due to deductions, you cannot submit Form 15G.

• Illustration:

Salary: ₹3,00,000

Interest from Savings account: ₹10,000

Total Gross Income: ₹3,10,000

Deductions under Section 80C & 80D: ₹ (1,20,000)

Net Taxable income: ₹1,90,000

• Since Taxable income is ₹1,90,000, no tax liability is imposed.

However, since the gross income is ₹3,10,000, which exceeds the exemption limit of ₹2,50,000, the individual is ineligible to submit Form 15G, regardless of having a zero tax liability after deductions.

Ø     UNDERSTANDING FORM 15H

While Form 15G is for general individuals, Form 15H is specifically designed for senior citizens (aged 60 years and above). Just like Form 15G, it allows senior citizens to request the deductor not to deduct TDS on their interest income, provided their tax liability is nil.

Form 15H is covered under Section 197A (1C) and Rule 29C of the Income Tax Rules.

Ø   WHO CAN SUBMIT FORM 15H?

Resident senior citizens aged 60 years and above can submit Form 15H. Even if an individual becomes a senior citizen for just one day during the financial year, they are eligible to submit Form 15H for the entire year.

• NRIs, HUFs, trusts, and other entities are not eligible.

Ø    ELIGIBILITY CRITERIA FOR FORM 15H

• The individual must be a resident senior citizen in India.

• The individual must have a valid PAN (Permanent Account Number)

• No specific basic exemption limit for Form 15H provided that the tax payable is nil.

(However, for practical purposes, banks and deductors often consider a limit of ₹12,00,000 as a threshold for accepting Form 15H)

It’s essential to remember that even if your total income exceeds the exemption limit, you can still submit Form 15H if your tax liability is nil after considering deductions under Chapter VI-A and rebates like Section 87A.

• Illustration:

Income from interest on fixed deposits: ₹5,00,000

Deductions under Section 80C: ₹ (1,50,000)

Net taxable income: ₹3,50,000

• Since net taxable income is ₹50,000, tax liability would be ₹2,500 (5% of ₹50,000)

• Section 87A provides full rebate as tax liability is less than ₹12,500

Here, since the tax liability is zero, the individual is eligible to file Form 15H

Ø   REVERSAL OF TDS AFTER SUBMITTING FORM 15G/ FORM 15H

In case TDS is deducted erroneously despite submitting Form 15G or 15H, you can request the deductor (like your bank) to reverse the TDS. This involves submitting the necessary documents, including:

• A copy of the submitted Form 15G

• An interest certificate showing the TDS deduction

• A formal request letter to the bank or deductor

Ø  CONSEQUENCES OF SUBMITTING A FALSE DECLARATION IN FORM 15G OR 15H

Honesty is critical when submitting Form 15G or Form 15H. If any individual provides false information in these forms, they can face severe legal consequences under Section 277 of the Income Tax Act, 1961.

Imprisonment: 

I. Tax evasion is below ₹25 Lakhs: 3 months to 2 years

II. Tax evasion exceeding ₹25 Lakhs: 6 months to 7 years

Ø   FINAL INSIGHTS

Forms 15G and 15H are invaluable tools for managing your tax liabilities effectively, especially if your income falls below the taxable threshold. By submitting these forms, you can avoid unnecessary TDS deductions, ensuring that your hard-earned money stays where it belongs—right in your pocket.

However, accuracy is crucial. Providing incorrect or false information can lead to legal complications. Always verify your income details, confirm that your tax liability is indeed nil, and ensure you meet all eligibility criteria before submission.

If you’re ever uncertain, consulting a tax professional can help navigate the process smoothly. For more expert insights and guidance on tax-related matters, visit Tax-O-Smart—your trusted partner in smart financial management.

DISCLAIMER

The information contained in this document is prepared by R.J. Soni & Associates and Tax-O-Smart (hereinafter referred to as RJSA) for information purpose only. It does not constitute any legal advice or tax advice. In no way, this document should be treated as a marketing material or efforts to solicit a client. While we have made every attempt to ensure that the information contained in this document is true, RJSA, its partners and/or any of its employees make no claims / guarantee about its accuracy, completeness, or up-to-date character, or warranty, express or implied, including the warranty of opinions expressed for a particular purpose, or assume any liability or responsibility for the accuracy, completeness, or usefulness of any information available from this document.