Who can submit Form 15G and 15H
This being the first quarter of the financial year, it is important, for all the people who want to receive interest without deduction of tax, to submit form no. 15G and 15G immediately to the banks. Recently rules/procedure related to particulars to be furnished and how to furnish these forms have been substantially amended. Let us discuss as to who can submit form no. 15G and 15H and the precautions to be taken while filing these forms.
When the bank will deduct TDS
The bank is required to deduct tax at source when interest on fixed deposits as well recurring deposits taken together exceeds Rs. 10,000/- in a financial year, for all the branches of the bank taken together, for the bank with core banking, otherwise the threshold of Rs. 10,000/- is to be calculated for each branch. Please note while determining the threshold of Rs. 10,000/- interest on your saving bank account shall not be taken into account.
There is an impression in the minds of people that fixed deposit with tenure of more than one year, the tax is deducted only at the time of maturity of the FD, i.e. at the time of payment payment of the interest. This is not so. The bank calculates interest for the period ended on 31st March and deduct tax, in case interest is more than 10,000/- for a year. So please bear this in mind otherwise you will be shocked when lower maturity amount is credited due to the tax having already been deducted in earlier years.
