Banks are instructed to deduct TDS on the interest earned by an assessee when the amount crosses the benchmark of Rs 10,000 per year. The bank in order to calculate the total interest earned by the depositor takes into account various deposits held by him in all branches of the bank. The bank deducts tax on the income if it exceeds Rs 10,000. However, if the amount earned is less than Rs 10,000 in the given year, then the depositor has to submit Form 15H in order to avoid deduction of TDS on his interest income.
However, the assessee must possess a valid PAN in order to apply for this form and reap benefits out of the same.
This form can also be submitted via online portals or through the bank’s registered website.
Form 15H has to be submitted by Indian citizens, i.e., people who have crossed or have reached the age of 60 years, while for people lying below the age of 60 years, Form 15G has to be submitted.
This form is valid only for a period of one financial year. A fresh form has to be submitted by the depositor (if eligible for the same) every year in order to avoid any kind of TDS deductions on his income earned as interest.
The banker or the deductor has to issue an acknowledgement slip to the applicant immediately after receiving the form. The slip must contain a valid acknowledgement stating that the form has been received by the bank.
An assessee is eligible for the submission of Form 15H if he fulfills the below mentioned criteria:
- He should be an individual and not an entity or an organization.
- He should be an Indian citizen residing in India.
- He should be minimum 60 years of age.
- The tax to be paid by the assessee for the past financial year should be nil.