Form 15G/15H: Avoiding TDS on Interest

These forms don’t make interest tax-free; they only tell the deductor not to withhold tax at source because, based on the depositor’s declared position, no tax is actually expected to be payable for the year.

Income Tax

HRA, LTA, and Standard Deduction

TDS on Salary, Property, and Professional Fees

Form 15G/15H

Section 194Q

Form 26AS, AIS, and TIS

Belated and Revised Returns

Rectification (Section 154)

Income Tax Refunds

Notices Under 143(1) and 143(2)

Appeals

Portal procedures and thresholds are periodically revised. This article is for general information and does not constitute tax advice.

What They Are, and Who Can Use Which

Both are self-declarations submitted to a deductor (typically a bank, but also applicable to corporate bond and NBFC deposit interest) requesting that TDS not be deducted on certain income, mainly interest, because the depositor’s estimated total tax liability for the year is nil. Form 15G is for individuals below 60, HUFs, and certain other non-corporate assessees. Form 15H is specifically for resident senior citizens (60 and above), and unlike 15G, doesn’t require total income to be below the basic exemption limit, only that the estimated final tax liability for the year is nil after applying rebates and deductions.

Eligibility for Form 15G

Two conditions apply together: estimated total tax liability for the year must be nil, and total income (including the interest itself) must not exceed the basic exemption limit. Someone whose income exceeds the exemption limit but ends up with nil tax purely because of rebates like Section 87A cannot use Form 15G; that specific relief is only available through Form 15H for eligible senior citizens.

Where and When to Submit

These forms are submitted at the start of a financial year (or when opening a new deposit) directly to the deductor, not filed with the Income Tax Department separately; the deductor is responsible for reporting the declarations received. A fresh form is required every financial year, and separately for each deductor if interest income is spread across multiple banks or institutions.

Consequences of a Wrong or False Declaration

Submitting either form when eligibility conditions aren’t actually met is a false declaration, potentially inviting prosecution under old Section 277 in serious cases, quite apart from the tax, interest, and penalty that follow from under-reporting the income. Regardless of what’s declared to the deductor, the interest income remains taxable and must be reported and taxed correctly through the return if a liability actually exists.

FAQs: Form 15G/15H

Can a senior citizen use Form 15G instead of Form 15H?

No. Once eligible as a senior citizen, Form 15H is the correct form; it has its own eligibility test and doesn’t require total income to stay below the exemption limit.

Does submitting Form 15G/15H make the interest income exempt?

No. It only stops TDS deduction at source; the underlying interest still has to be reported and taxed if a genuine liability exists.

If someone has multiple fixed deposits at the same bank, is one Form 15G/15H enough for all of them?

Generally one submission per deductor per year covers all accounts held there, but a fresh form is still needed if a new deposit is opened after the original submission, depending on the bank’s process.

Can Form 15G be used by someone whose income is only nil-tax because of the 87A rebate, above the exemption limit?

No, Form 15G specifically requires total income to be below the exemption limit itself, not merely a nil final tax after rebate. That relief route is available only through Form 15H for eligible senior citizens.

What happens if TDS was already deducted before the form was submitted?

The form only prevents future deductions from the point it’s accepted; TDS already deducted has to be claimed back as a refund through the income tax return.

Do these forms apply to dividend income as well as interest?

Form 15G/15H can also be submitted to companies to avoid TDS on dividend under similar eligibility conditions, not only to banks for deposit interest.

Last updated on 8 August 2026