Do You Have Any Fixed Deposit? Banks Deduct TDS & Here’s How You Can Save Your Tax
It’s the time of the year where we curse the government and have to fill out endless forms because of the income tax requisite. As an adult who is working, we have certain responsibilities that can’t be procrastinated. So, if you are earning a certain X amount and have deposited some of it as Fixed Deposit, then you should read this article!
The bank is required to deduct tax at source when interest on fixed deposits exceeds Rs. 10,000 in a financial year. Also, people have an impression that the tax will be deducted only at the time of maturity of the Fixed Deposit but it is not the case. The bank calculates proportionate interest for the period ended on 31st March and will deduct tax, in case interest is more than 10,000 for a year.
What is Form 15G and Form 15H?
Form 15G and Form 15H are forms you can submit to make sure TDS is not deducted from your income if you meet the conditions mentioned below. Also, you must have a PAN before applying for these forms.
Can you submit form 15G?
For being eligible to submit form 15G you need to satisfy two conditions together.
1. Your tax liability calculated on your total income should be NIL
2. The total of the aggregate of your income for which form 15 G can be submitted should not exceed the basic exemption limit of Rs. 2.50 lakh.
As per the revised rules form 15G and 15H can either be submitted in physical mode or can be submitted in electronic form through the website of the bank.
What can you do if the bank has already deducted tax before you submit the form?
Ideally, the form 15G or 15H should be submitted at the beginning of the year so as to avoid a situation where the bank has already deducted the tax before you submit the form. However in case, the tax has already been deducted by the bank before you submit the form or even in spite of having submitted the form, you cannot get the refund for such tax from the bank for the tax so deducted. The only recourse available to you is to claim the refund by filing your income tax return after collecting the form 16A from the bank.
KEEP IN TOUCH!
Subscribe to our Newsletter
Don't worry, we don't spam