TDS on incomes such as interest and rent can be avoided by submitting form 15G or 15H to the appropriate person or organisation such as banks, corporate bond issuers, post offices.
Also read: How to avoid higher TDS on salary
How to avoid
To avoid TDS on interest income, submit Form 15G or 15H. Form 15G is for people under the age of 60, and Form 15H is for people above the age of 60. These forms can only be submitted if the total income tax is zero and the total interest collected during the fiscal year does not exceed the basic exemption slab.
How to submit Form 15G/H online in HDFC Bank?
Step 1: Login using your credentials
Step 2: Click on Request under Accounts tab.
Step 3: Select Form 15G or H depending if you are a regular citizen or senior citizen.
Step 4: Check details
Step 5: Click on Confirm tab.
The 15G category includes trusts, HUFs, and resident Indians under 60. For resident Indians 60 years of age or older, use Form 15H. The 15G and 15H forms are only valid for one fiscal year and must be submitted every year.
The threshold of Rs 40,000 of all interest income earned will be determined in aggregate, which means that all interest income from all deposits made at all of the bank’s branches will be taken into account. The applicable threshold for senior citizens is Rs 50,000.
Why Form 15G/H should be submitted
A person residing in India who is not a company, firm, or cooperative organisation can submit Form 15G/15H to their bank in order to urge that tax at source not be deducted from the interest received on term deposits (fixed deposits, cash certificates, and recurring deposits) with the bank. This declaration can only be made if the expected total income is less than or equal to the basic exemption limit indicated by the Income Tax Department’s regulations. The consumer must submit Form 15G/15H with a Permanent Account Number (PAN).
When to Submit Form 15G & Form 15H?
Your Form 15G or Form 15H should preferably be submitted at the start of the fiscal year. Providing your anticipated income for the fiscal year does not exceed the maximum amount eligible for tax exemption. You can avoid paying any TDS on interest for the entire fiscal year by doing this.