How to submit Form 15H, Form 15G to avoid TDS on interest income
If you invest in a taxable investment like a bank fixed deposit (FD), recurring deposit or company deposit, the interest you earn gets taxed.
In most fixed-income products, unless it's a tax-free investment, since the interest income earned during the year has to be added to your income it will be taxed. In other words, the interest income is entirely taxable as per the individual's income tax rate of 5.2 percent, 20.8 percent or 31.2 percent including a surcharge of 4 percent.
The tax will be deducted at source (TDS) by the institution when the interest is paid to the investor. The amount of TDS can be adjusted later by the taxpayer while paying the annual taxes or at the time of filing the income tax return (ITR).
Here is how you can avoid paying TDS on your fixed income investments.
TDS limits The institution will deduct tax at source only when the interest income exceeds a certain limit. If your interest income exceeds Rs 10,000 in a year, the bank will deduct 10 percent as TDS on the entire interest amount. At times, there could be more than one deposit in different branches of the same bank. In such cases, the interest amount is to be added up for TDS purpose. The TDS limit for interest income earned in company deposits is Rs 5,000.
What's new:From April 1, 2018, a new section has been inserted in the Income-tax Act, 1961, 80TTB, that allows a deduction up to Rs 50,000 in respect of interest income from deposits held by senior citizens. However, no deduction under section 80TTA shall be allowed in these cases. The Section 80TTA provides a deduction of Rs 10,000 on interest income from savings account in bank deposits and post office. For them the TDS, therefore, gets deducted only when interest income exce ..
Nature of deposits The frequency of interest i.e. monthly, half-yearly or cumulative payments will not impact the incidence of TDS. The moment TDS accrues in the case of cumulative deposits or gets credited to the savings account of the taxpayer in the case of half yearly deposits, TDS is deducted by the bank provided the interest paid exceeds Rs 10,00 across all branches in aggregate during an FY
How to avoid TDS You can submit a declaration Form 15G or 15H to avoid TDS on interest income. While Form 15G is for individuals below 60 years, Form 15H is for individuals above 60 years of age. One can submit these forms only when the tax on total income is nil and the aggregate of the interest received during an FY does not exceed the basic exemption slab of Rs 2.5 lakh and Rs 3 lakhs for senior citizens and Rs 5 lakhs for super senior citizens.
Penalty for wrong information If you furnish these forms to the bank even if you are not eligible to submit them, you will be penalised. If a taxpayer makes a false declaration in Form 15G or Form 15H, and the tax sought to be evaded exceeds Rs 25 lakh, he could be subject to rigorous imprisonment which could range from 6 months to 7 years accompanied by a fine. In any other case, a taxpayer would be subject to rigorous imprisonment ranging from 3 months to 2 years with a fine under Section 277 of the Income-tax Act.
The table below shows the eligibility conditions.
Online filing One can file these forms online as well instead of submitting them at a bank branch. Find it from your bank if your bank allows filing of Form 15G/H online through Net banking.
Steps to file Form 15G/H online ( May vary across banks) Step 1. Log in to the bank's Internet banking portal with your User ID and Password Step 2. Select Tax Section Step 3. Click on Form 15G/H Step 4. Fill in the necessary details Step 5. Click on Submit Step 6. Download the acknowledgment slip Step 7. Save the Service Request number for your future.
What you should do If you have held the deposit for more than a year, you need to submit a fresh form 15 G/H each financial year. And this should ideally be done at the start of every financial year. More importantly, remember that the interest earned is entirely taxable and hence, fixed deposits will work more like a wealth protection tool rather than one for wealth creation. Stay away from them unless your goal is 1-2 years away or if you are a senior citizen depending on r ..
SIPs are Best Investments when Stock Market is high volatile. Invest in Best Mutual Fund SIPs and get good returns over a period of time. Know Top SIP Funds to Invest Save Tax Get Rich - Best ELSS Funds
For more information on Top SIP Mutual Funds contact Save Tax Get Rich on 94 8300 8300
Axis MF has announced that the NFO period of Axis Fixed Term Plan Series 18 (15 Months) under Axis Fixed Term Plan Series 17 19 has been preponded from February 27 to February 24. --------------------------------------------- Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C. Invest Tax Saving Mutual Funds Online Tax Saving Mutual Funds Online These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving) Download Tax Saving Mutual Fund Application Forms from all AMCs Download Tax Saving Mutual Fund Applications These Application Forms can be used for buying regular mutual funds also Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds ) HDFC TaxSaver ICICI Prudential Tax Plan DSP BlackRock Tax Saver Fund Birla Sun Life Tax Relief '96 Reliance Tax Saver (ELSS) Fund IDFC Tax Advantage (ELSS) Fund SBI Magnum Tax Gain Schem...
Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 The new finance minister Arun Jaitley has just presented his first budget. What measures does the budget contain that will specifically impact savers and investors? Here they are: 1. Housing loans exemption for self-occupied properties increased to Rs2 lakh: Earlier this amount was Rs1.5 lakhs. This move barely keeps pace with the inflation in asset values. 2. Investment limit under 80 (C) increased to Rs1.5 lakh: This is a good move again and offers some relief to taxpayers. 3. IT exemption increased to Rs2.5 lakh, Rs3 lakh for senior citizens. This comes as a minor relief for taxpayers. 4. Annual PPF ceiling to be enhanced to Rs1.5 lakh, from Rs1 lakh: This is in tune with the change in 80C. 5. Long term capital gains tax for debt funds has been rai...
Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India) This fund maintains a quality portfolio of large-cap orientation. The fund manager adheres to a bottom-up investment approach and looks for companies whose current market price does not reflect future growth prospects. Investments are in companies that can drive future earnings growth. Stocks are selected based on the company's financial strength, management's expertise, growth potential within the industry, and the industry's growth potential. The portfolio is well-diversified across sectors and market capitalisation and follows a blend of value and growth style of investing. The fund follows a predominantly large-cap allocation of over 70 per cent, with small-cap allocation never exceeding 10 per cent since inception. Performance The fund doesn't dev...
Match your Goals Risk Profile With ELSS Investment DIFFERENT TRACKS Unlike funds with a clearly defined investment universe -- large-cap, mid-cap or multi-cap - Tax Saving Schemes do not specify investment focus If you are looking for an equity Linked Savings Scheme (ELSS) to pare your tax burden, the plethora of options may confuse you. Many investors simply opt for ELSS funds , also called tax saving schemes with the best return over a certain time period. However, this may not yield the best results. There are several types of ELSS funds and it requires a nuanced approach to pick the right one. DIFFERENT RISK PROFILES Unlike funds with a clearly defined investment universe -- large-cap, midcap or even multi-cap schemes in the ELSS category do not specify their investment focus. While these schemes have the flexibility to invest anywhere, most tend to follow a defined template. For instance, some funds take a distinct large-cap tilt with a limited exposure to mid or small-cap st...
Invest in Reliance Tax Saver Fund Online ----------------------------------------------- Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds Top 10 Tax Saving Mutual Funds to invest in India for 2016 Best 10 ELSS Mutual Funds in india for 2016 1. BNP Paribas Long Term Equity Fund 2. Axis Tax Saver Fund 3. Franklin India TaxShield 4. ICICI Prudential Long Term Equity Fund 5. IDFC Tax Advantage (ELSS) Fund 6. Birla Sun Life Tax Relief 96 7. DSP BlackRock Tax Saver Fund 8. Reliance Tax Saver (ELSS) Fund 9. Religare Tax Plan 10. Birla Sun Life Tax Plan Invest in Best Performing 2016 Tax Saver Mutual Funds Online Invest Online Download Application Forms For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call --------------------------------------------- Leave your comment with mail ID and we will answer them OR You can write to us at PrajnaCapital [at] Gmail [dot] Com OR Leave a mis...
