Form 15G: As per the Income Tax Rules 1962, an individual aged below 60 years, is required to submit a declaration in Form 15G to the respective entities such as Banks, Financial institution for not deducting TDS on the interest income.
Banks generally deduct TDS on the interest income accrued from Fixed Deposits, Recurring Deposits if it exceeds Rs.40,000/-(Earlier this limit was Rs.10,000/-) and Rs.50,000/- for Senior Citizens in a financial year from F.Y 2019-20.
This includes interest income from all the branches of a particular bank. Here Form 15G safeguards the investors from TDS being deducted on the interest income accrued on their investments.
Also, the Employees Provident Fund Organisation(EPFO) has made it mandatory vide the provisions of Section 192A to submit Form 15G on EPF withdrawal if the amount withdrawn exceeds Rs.50,000/- and the working period is less than continuous 5 years.
⇒What is Form 15G?
As per section 197(1) and 197(1A) of the Income Tax Act, 1961, an individual or a person (other than a company or a firm) below 60 years of age must submit a declaration to banks or other financial institutions, stating that his net taxable income if any including this interest income is below the threshold exemption limit of Rs. 2.50 Lakh, so TDS need not be deducted on the interest income to be earned by him.
Therefore, 15G Form ensures that no TDS is deducted on the estimated interest income earned in a particular financial year. It can be said that the 15G Form prevents the interest income paying authorities from deducting TDS on interest.
Form 15G is usually submitted just after the beginning of the financial year i.e. first week of April every year. But considering the present Pandemic condition, the CBDT has extended the last submission date of Form 15G for F.Y 2020-21 till 1st week of July 2020.
⇒Who can apply for 15G?
There are certain conditions to be fulfilled to be eligible to submit 15G form.
- You are an individual or member of HUF, Trust but not a company or Firm;
- You have to be a resident Indian;
- Your age must be below 60 years;
- Total interest income for the year is below the basic exemption limit of Rs. 2.5 Lakh for the F.Y 2020-21;
- Your tax on the total income(including income from all other sources) is NIL;
⇒How to fill Form 15G for PF withdrawal?
- 1. Name of Assesse (Declarant) – Here write your name as per the income tax records;
- 2. PAN of the Assesse – Write your PAN number;
- 3. Status – Write Individual or HUF as per your status;
- 4. Previous Year – Put the Current Financial year (F.Y) for which you are filing the form;
- 5. Residential Status – If you are a resident individual, only then you can submit this form, so write as ‘Resident Individual’ here;
- 6. Flat/Door/Block No – Put your address here;
- 7. Name of Premises – Put the address details here;
- 8. Road/Street/Lane – Put the address details here;
- 9. Area/Locality – Put the area/locality details here;
- 10. Town/City/District – Put the town/city/district details in this area;
- 11. State – Write down the name of the state you belong to;
- 12. PIN – Put your PIN code here;
- 13. Email– If you have an email id, put it here;
- 14. Telephone no– Put your telephone/ mobile number here;
- 15. (a) Whether assessed to tax under the income tax act, 1961? – If you paid tax in any of the past 6 years, answer this question with ‘Yes’;
- 15. (b) If yes, latest assessment year for which assessed – Mention the latest year in which your income was above the taxable limit and you paid tax on it;
- 16. Estimated income for which declaration is made – Total of the interest income on which TDS should not be deducted;
- 17. Estimated total income of the previous year in which income mentioned in column 16 to be included – Here put your total income from all sources such as salary, interest income, any other income that you have earned during the year including the interest income as mentioned in Column16 above;
- 18. Details of Form 15G other than this form filed during the previous year, if any– This section is most crucial. Here put the total numbers of form 15G filed and the total amount of income for which Form 15G is filed;
- 19. Details of income for which declaration is filed – Identification number of relevant investment/account, different types of income did you receive, under which section the income is taxable and finally the amount of income you earned;
- Signature of Declarant – Finally put your signature here________.
⇒How to fill Form 15G new format?
In the above section, the process of how to fill Form 15G new format has been shown steps by steps. You just need to follow the steps carefully to avoid any mistakes and submit it successfully.
⇒PDF Form 15G Download/Form 15G sample
⇒Form 15G word format Download
The link to Form 15G word format download is given below:
⇒epfindia.gov.in Form 15G/EPF Form 15G
It had earlier come to the notice of the Govt. that employees provident fund which was meant for meeting post-retirement expenditure, but there had been a tremendous withdrawal trend from this fund within short job tenure.
Therefore, the Govt. had come with a panacea to curb this withdrawal trend by introducing Section 192 A of the Income Tax Act and Section 5 of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952).
You may read the below posts:
This provision states that any person authorised under the scheme to make payment of the accumulated balance due to employees, shall, in a case where the accumulated balance due to an employee participating in a recognised provident fund is includible in his total income owing to the provisions of rule 8 of Part A of the Fourth Schedule not being applicable, at the time of payment of the accumulated balance due to the employee, deduct income-tax thereon at the rate of 10%.
⇒What does Section 192A say?
TDS @10% (Maximum marginal rate if PAN not submitted) is to be deducted if the following conditions are satisfied: a). EPF withdrawal is before continuous 5 years of service, b). Amount withdrawn is more than Rs.50,000/-.
⇒Is 15G form required for PF withdrawal?
It is not mandatory to submit the EPF 15G Form for PF withdrawal. Section 192A of the I.T Act clearly stipulates that TDS@10% needs to be deducted by the deductor on pre-mature EPF withdrawal. Submission of this 15G Form helps you in avoiding the TDS deduction.
So, basically EPF Form 15G contains a declaration stating that after receiving their PF accumulation from EPFO, their income would not be chargeable to tax and no TDS to be deducted.
In the following case TDS will not be deducted by the deductor:
- If the employee has completed 5 years of continuous service;
- If the amount withdrawn from EPF is less than Rs.50,000/-;
- If the employee has submitted EPF Form 15G along with valid PAN;
- The PF amount is transferred from one PF account to another due to change of job;
- If there is a termination of a job due to the employee’s ill health or any other reason beyond employee’s control;
So, you can check from the above that submission of 15G Form for EPF withdrawal is not mandatory, but if one submits this, TDS would not be deducted on premature EPF withdrawal at the time of making payment.
FAQs on 15G Form:
False Declaration in 15G Form
15G Form helps us to save our TDS burden. However, it is advisable not to submit a false declaration in 15G Form just for avoiding TDS. This may lead to a fine and even imprisonment under Section 277 of the Income Tax Act, 1961.
Who is eligible for 15g?
A resident individual below 60 years/ member of HUF/ Trust is eligible for 15G. A company of Firm is not entitled to submit 15G Form. A senior citizen is also not eligible for 15G Form.
Check the below table to understand the eligibility to submit 15G form.
What happens if 15G not submitted?
The Central Board Direct Taxes(CBDT) has notified vide Notification No-F No.275/25/2020-IT(B) Dated 03.04.2020, that the valid Form 15/Form 15H submitted for F.Y 2019-20 will remain valid up to 30.06.2020 and shall be considered as a valid one for F.Y 2020-21.
This means the previously submitted valid 15G form will also remain valid for F.Y 2020-21. Further, for F.Y 2020-21 the 15G submission date has been extended up to 1st week of July 2020.
If anyone fails to submit 15G Form, at best the deductor will deduct TDS @10% if he has valid PANsubmitted with the banks or other financial institutions. But if no valid PAN is found TDS at the maximum marginal rate of tax @31.20% will be deducted.
However, there is nothing to worry if one fails to submit 15G Form. One can easily file his income tax return showing refund of the TDS so deducted on interest income, considering your total income does not exceed Rs. 2.50 Lakh in a financial year including the income on which TDS was deducted for non-submission of valid 15G Form.