Forms 15G and 15H: Choosing the Right Form for Tax Exemptions

Form 15G and Form 15H are two commonly used forms in India by those looking to get tax exemptions. While filling out both forms allows individuals to avoid charges for tax deduction at source (TDS), each form has specific criteria and situations where they are applicable. 

This article will compare and contrast Form 15G and Form 15H, highlighting the key differences between the two. By understanding these distinctions, individuals can determine which form is appropriate for their circumstances and optimise their tax exemption.

Age Criteria

Form 15G applies to individuals below a certain age threshold, typically below 60 years. It is commonly used by non-senior citizens, including students and working professionals. 

On the other hand, Form 15H is specifically designed for senior citizens, generally aged 60 years and above. This age-based distinction allows individuals to choose the form that aligns with their age and eligibility.

Income Limits

Another differentiating factor between the two forms is the income limits. Form 15G is relevant for individuals with income below the taxable limit, irrespective of age. It enables them to declare that their total income for the financial year falls below the specified threshold. This form is commonly used by individuals including students and non-senior citizens who have income below the applicable limit. 

In contrast, Form 15H applies to senior citizens who declare that their income falls below the taxable limit, indicating that they have no tax liability.

Specific Situations

Form 15G and Form 15H are applicable in different situations. Form 15G is commonly used by individuals who are not senior citizens and fulfil the income criteria. It helps them avoid TDS deductions on their income from specified sources such as interest earned on savings accounts, fixed deposits, or recurring deposits.

On the other hand, Form 15H is specifically designed for senior citizens with minimal income and no tax liability. It enables them to prevent TDS deductions on their income, thus providing relief to those who are retired or have limited income sources.

Determining the Appropriate Form

To determine the appropriate form for tax exemption, individuals should consider their age, income, and eligibility based on the criteria mentioned above. Younger individuals with incomes below the taxable limit can opt for Form 15G. Senior citizens with minimal incomes can choose Form 15H. 

It is essential to carefully assess one's eligibility based on age and income criteria and select the appropriate form to optimise one's tax exemption. By choosing the right form, individuals can ensure that their TDS deductions are minimised, helping them manage their finances more efficiently.

Conclusion

Understanding the differences between Form 15G and Form 15H is crucial for individuals seeking tax exemption. By comparing the age criteria, income limits, and specific situations where each form is applicable, individuals can make informed decisions. Learn more about tax exemptions and forms with Federal Bank today.