Form 15G and 15H: Avoiding Unnecessary TDS

Few things irritate small savers more than seeing tax deducted from their bank interest when they know they owe no tax at all. A retiree living on fixed deposits, or a homemaker with some interest income, can find the bank quietly knocking off 10% as TDS — money they then have to chase as a refund months later by filing a return. Form 15G and Form 15H exist precisely to prevent this. They are simple self-declarations that tell the bank, "My income is below the taxable limit, please do not deduct tax from my interest." Used correctly, they save you the hassle of locking up cash with the tax department and waiting for a refund. Used carelessly, they can land you with a penalty. This guide explains who can file which form, the exact conditions, the timing, and the mistakes that catch people out.

What These Forms Actually Do

When you earn interest above a threshold, your bank is legally required to deduct TDS — typically 10% — and deposit it with the government against your PAN. This happens regardless of whether you actually owe any tax. The bank has no way of knowing your total income; it only sees the interest it pays you.

Form 15G and Form 15H are your way of informing the bank that your overall tax for the year will be nil, so there is no point deducting TDS in the first place. The bank, on receiving a valid form, stops deducting TDS on your interest for that financial year.

Crucially, these forms prevent TDS — they do not exempt the income. The distinction matters enormously. If your income is genuinely below the taxable limit, the form simply spares you from over-deduction and a refund claim. But if you are actually liable to tax and file the form anyway, you have made a false declaration, and the tax does not disappear — you still owe it, now with the added risk of a penalty.

The Two Forms: Who Files Which

The split is purely by age:

Feature	Form 15G	Form 15H
Who can file	Resident individuals below 60, and HUFs	Resident senior citizens (60+)
Eligible entities	Individuals and HUFs (not companies or firms)	Individuals only
Condition 1 — total income below basic exemption limit	Required	Not required
Condition 2 — final tax for the year is nil	Required	Required

The key difference is that Form 15G has two conditions while Form 15H has only one.

Form 15G (below 60): You must satisfy both —

1. Your estimated total income for the year is below the basic exemption limit, and
2. Your total tax computed on that income is nil.

Form 15H (senior citizens 60+): You must satisfy only —

1. Your total tax computed for the year is nil.

Why the relaxation for seniors? Because senior citizens enjoy a higher basic exemption and the benefit of the Section 87A rebate, a senior can have income above the basic exemption limit and still end up with zero tax after the rebate. Form 15H accommodates this by dropping the first condition. A senior whose tax works out to nil after the rebate can file 15H even if gross income is above the bare exemption figure.

Non-resident Indians cannot file either form — these are for residents only.

The Conditions in Plain Terms

The single condition both forms share is that your final tax liability for the year must be nil. This is the test that matters. Work out your total income from all sources — pension, interest, rent, any small earnings — apply your deductions, compute the tax, and apply the Section 87A rebate. If the result is zero, you qualify on that count.

For Form 15G, you must additionally have total income below the basic exemption limit before deductions in the relevant sense the form asks for. This stricter test exists because a younger person's nil tax often comes from the 87A rebate kicking in above the exemption limit, and the form deliberately does not let them use that route — only genuinely low total income qualifies.

A practical way to think about it: senior citizens get more room because their exemption is higher and the law trusts the rebate to do the work, while those below 60 must be more clearly below the line.

When and Where to Submit

Timing — at the start of every financial year. The declaration is valid only for the financial year in which it is made. You must submit a fresh Form 15G or 15H each April (or as soon as the year begins) to keep TDS from being deducted. A form submitted last year does nothing this year.

Submit to every bank and every branch. The declaration applies to the specific bank branch you give it to. If you hold deposits across three banks, or even across different branches of the same bank that maintain separate records, you submit a form at each. Miss one, and that branch deducts TDS as usual.

Submit before interest is paid or credited. If you file the form after the bank has already deducted TDS for that quarter, the deduction stands — the form is not retrospective. The only way to recover already-deducted TDS is to file your income tax return and claim a refund. So submit early in the year, before the first interest credit.

It is not only for banks. While most people associate these forms with bank FDs, you can also submit them to companies paying you interest, to post offices, to EPFO for premature provident fund withdrawals (where TDS would otherwise apply), and in some other TDS situations where your income is below the taxable limit.

A Worked Example: When 15H Saves Real Cash

Take Mr Verma, a 70-year-old retiree in Lucknow with the following for FY 2025-26, planning to use the old regime:

• Pension: ₹2,40,000
• Fixed deposit interest: ₹2,80,000 from one bank

Step 1 — Gross income: ₹2,40,000 + ₹2,80,000 = ₹5,20,000.

Step 2 — Deductions:

• Standard deduction on pension: ₹50,000
• Section 80TTB (interest deduction for seniors, capped at ₹50,000): ₹50,000

Taxable income = ₹5,20,000 − ₹1,00,000 = ₹4,20,000.

Step 3 — Tax (senior citizen, old regime, basic exemption ₹3,00,000):

• Up to ₹3,00,000: Nil
• ₹3,00,000–4,20,000 at 5%: ₹6,000

Tax before rebate = ₹6,000. Since taxable income is below ₹5,00,000, the Section 87A rebate of up to ₹12,500 wipes it out. Final tax = nil.

Because his final tax is nil, Mr Verma can file Form 15H with his bank. Had he not, the bank would have deducted 10% TDS on FD interest above ₹50,000 — roughly ₹28,000 — which he would have had to reclaim by filing a return. Form 15H lets him keep that ₹28,000 in hand all year.

Note how 15H's relaxed condition helps: his gross income of ₹5,20,000 is above the bare ₹3,00,000 exemption, yet because his final tax is nil after deductions and the rebate, he still qualifies for 15H. Someone below 60 in a similar position would struggle to use 15G, because 15G's stricter income test would not be met.

You can confirm whether your own final tax comes to nil using the income tax calculator, and check what TDS would otherwise apply with the TDS calculator.

How the Form Relates to Your Wider Tax Picture

Form 15G/15H is one piece of a larger TDS and interest puzzle. Remember:

• Even with the form filed, your interest is still taxable income if your situation changes mid-year — it only stops the deduction. The taxability is governed by the rules in our guide to tax on FD and savings account interest.
• The form does not remove your obligation to file a return if you otherwise need to.
• If you have salary plus interest and other income, the bigger question may be whether you owe advance tax — a very different situation, since that applies to people who do have a tax liability, not those filing 15G/15H.

These forms are specifically a tool for the nil-tax taxpayer. If you have meaningful tax to pay, they are not for you, and proper tax planning is the better route.

Beyond Bank FDs: Other Places These Forms Help

While bank fixed deposits are the most common use, Form 15G and 15H can prevent TDS in several other situations where your income is below the taxable limit:

EPF premature withdrawal: If you withdraw your provident fund balance before completing five years of continuous service, TDS at 10% applies on the taxable portion if the amount is ₹50,000 or more. If your total income for the year is below the taxable limit, you can submit Form 15G (or 15H for seniors) to the EPFO to avoid this TDS. This is especially relevant for young employees withdrawing PF between jobs.

Company and corporate deposits: Companies deduct 10% TDS on interest above ₹5,000 — a far lower threshold than banks. If your income is nil-tax, Form 15G/15H submitted to the company stops this deduction.

Post office schemes and the Senior Citizens' Savings Scheme: Post offices deduct TDS on interest from certain schemes once it crosses the threshold. Seniors living on the Senior Citizens' Savings Scheme frequently use Form 15H here.

Rent and certain other payments: In limited cases where TDS would apply to payments made to you and your income is below the taxable limit, these declarations can be used, though banks and deposits remain the dominant use.

The common thread is always the same: the forms only make sense where your final tax for the year is genuinely nil and TDS would otherwise be deducted.

The PAN and Aadhaar Requirement

A valid PAN is mandatory to file Form 15G or 15H. Without a PAN on record, the bank cannot accept the declaration and will deduct TDS at the higher 20% rate that applies to PAN-less interest. Beyond simply having a PAN, it must be operative — that is, linked with your Aadhaar. An inoperative PAN can cause the declaration to fail and TDS to be deducted at the higher rate, even though you filed the form. Before submitting your forms each April, confirm that your PAN is active and Aadhaar-linked. This single check prevents a frustrating situation where you filed the form correctly but still saw tax deducted because the PAN was flagged as inoperative.

Common Mistakes

Filing 15G or 15H when you are actually taxable. The gravest error. People file these forms to avoid the inconvenience of TDS without checking whether their tax is genuinely nil. If you are liable to tax, this is a false declaration that can attract a penalty and even prosecution. Always compute your final tax first; file only if it is truly zero.

Using the wrong form for your age. Those below 60 must use 15G; seniors use 15H. Submitting 15H when you are 50, or 15G when you are 65, leads to rejection or wrong treatment. Match the form to your age precisely.

Submitting once and forgetting. The declaration lasts one financial year. Failing to resubmit each April means TDS resumes automatically. Set an annual reminder.

Forgetting a bank or branch. The form is branch-specific. If you have FDs in multiple banks and file at only one, the others deduct TDS. List every institution where you have interest income and cover each.

Filing after TDS has been deducted. The form is not retrospective. Once the bank deducts TDS for a quarter, you cannot reverse it with a late form — you can only claim a refund by filing your return. Submit at the very start of the year.

Treating the form as a reason not to file a return. Stopping TDS does not stop the income from appearing in your AIS. If you need to file a return, you still must. And if your circumstances were borderline, filing protects you against a mismatch notice.

What to Do Next

1. Work out your total income for the year and compute your final tax using the income tax calculator. Only proceed if the result is genuinely nil.
2. Confirm your age category — Form 15G if below 60, Form 15H if 60 or above.
3. List every bank, branch, post office and company that pays you interest above the TDS threshold, and check the likely TDS with the TDS calculator.
4. Submit the correct form to each of them at the start of the financial year, before the first interest credit. Most banks accept these forms online through net banking.
5. Even after filing, keep your interest certificates organised with a tax document checklist, and file your return if you are otherwise required to, reconciling against your AIS.

Form 15G and 15H are small forms that do one clean job: they keep your own money in your hands when you owe no tax, instead of parking it with the government for a year. The discipline is to use them honestly and on time. Check that your tax is truly nil, pick the right form for your age, submit fresh each April to every bank, and you will never again watch tax vanish from interest you were never going to owe tax on.

Disclaimer: This article is for educational purposes only and is not tax advice. Tax rules change frequently — verify current provisions on the official income tax portal or with a qualified CA before filing.