Form 15G & 15H Explained: How to Stop TDS on Interest Income (Form 121 Update)

Form 15G & 15H Explained: How to Stop TDS on Interest Income (Form 121 Update)

Your bank is about to deduct 10% of your fixed deposit interest — automatically, without asking. Your total income for the year doesn't touch the taxable limit. And yet, unless you take one specific step, that money leaves your account and sits with the Income Tax Department until you file a return and claim it back months later. Form 15G and Form 15H exist to stop that from happening in the first place. These self-declaration forms tell the deductor your tax liability is zero, so no TDS should be cut. Here's everything you need to know — including what Form 121 means for the future of these forms.

What Are Form 15G and Form 15H — And How Do They Work

Both forms serve the same core purpose. They are declarations submitted by taxpayers to prevent TDS being deducted on specific income types — bank interest, dividends, rent, pension — when total tax liability for the financial year works out to nil.

The difference lies in who files which one.

Form 15G is for resident individuals below the age of 60. It can also be filed by Hindu Undivided Families, trusts, and other eligible assessees — but not by companies or firms. Two conditions must both be satisfied: your estimated total income must fall below the basic exemption limit, and your tax liability must be nil.

Form 15H is exclusively for resident senior citizens aged 60 years or above. The condition here is slightly easier to meet — only nil tax liability is required. Your income doesn't need to stay below the exemption limit, as long as the final tax calculation comes to zero after deductions.

Both forms must be submitted to the entity responsible for deducting TDS — your bank, EPFO, LIC, or wherever the relevant income originates. Submission happens quarterly, and both online and offline routes are available.

Here's what most people get wrong — these forms don't exempt you from tax permanently. They simply stop TDS from being deducted upfront, on the basis of your self-declaration. If your income later turns out to be taxable, you must inform the deductor immediately.

Who Can Submit Form 15G and Form 15H — Eligibility at a Glance

Getting the eligibility right matters. Filing the wrong form, or filing when you don't qualify, attracts serious penalties.

Form 15G — Eligibility Conditions

• Resident individual below 60 years of age, or an HUF
• Total estimated income for the year must be below the basic exemption limit
• Tax on total income must be nil
• Companies and firms are not eligible to file this form

Form 15H — Eligibility Conditions

• Resident individual aged 60 years or above
• Tax on total income must be nil
• Income need not be below the basic exemption limit — nil tax is sufficient

One rule applies to both forms equally. Non-residents are not eligible. The benefit is restricted to residents of India only, regardless of age or income level.

The illustration makes this concrete. Meena is 35, earns Rs 2,10,000 from a fixed deposit in FY 2025-26, and has no other income. Her total income is below the Rs 2,50,000 basic exemption limit under the Old Tax Regime, so her tax is nil. Without Form 15G, her bank would still deduct 10% TDS under Section 194A. She submits the form in April and receives her full interest with nothing cut.

Mr. Sharma is 65 and earns Rs 2.8 lakh in FD interest and Rs 50,000 in dividends. After claiming Rs 1,50,000 in Section 80C deductions, his taxable income drops to Rs 1.8 lakh — below the Rs 3 lakh senior citizen exemption limit. Tax is nil. He submits Form 15H and his bank stops the TDS deduction entirely.

TDS Sections Where Form 15G and Form 15H Apply

Both forms work across a broader set of income types than most people realise. Here's the full picture:

Section	Nature of Payment	Threshold Limit	Form 15G	Form 15H
192A	Premature EPF withdrawal	Rs 50,000	✓	✓
193	Interest on debentures, government bonds	Rs 5,000 or Rs 10,000	✓	✓
194	Dividends	Rs 10,000	✓	✓
194A	Interest from bank FD, RD, savings	Rs 50,000 (Rs 1,00,000 for senior citizens)	✓	✓
194D	Insurance commission	Rs 20,000	✓	✓
194DA	Life insurance maturity proceeds	Rs 1,00,000	✓	✓
194EE	NSS withdrawal	Rs 2,500	✓	✓
194-I	Rent — land, building, plant and machinery	Rs 50,000/month or Rs 6 lakh/year	✓	✓
194K	Income from mutual fund units	Rs 10,000	✓	✓

Key Differences Between Form 15G and Form 15H

The honest answer is that most people confuse these two forms because the purpose is identical. The separation is purely based on age and the income condition attached to each.

	Form 15G	Form 15H
Who qualifies	Resident individuals below 60, HUFs, trusts, other assessees	Resident individuals aged 60 or above
Who doesn't qualify	Companies, firms	Non-residents, individuals below 60
Income condition	Total income below basic exemption limit AND tax must be nil	Tax on total income must be nil only
Residency	Residents of India only	Residents of India only

And that's exactly where it matters — the income condition. For Form 15H filers, nil tax is enough. For Form 15G filers, income must also stay below the exemption threshold. Both conditions must be satisfied simultaneously for the younger age group, while seniors only need to clear the tax test.

What Is Form 121 — The New Unified Declaration

This is the part nobody talks about enough, and it's worth paying attention to.

Form 121 is a proposed new unified self-declaration form that is designed to eventually replace both Form 15G and Form 15H. Unlike the current system where two separate forms exist based on age, Form 121 can be filed by resident taxpayers regardless of their age group. The core purpose remains the same — declaring that total income is below the taxable limit so TDS is not deducted on interest, dividends, and other eligible income.

Form 121 is currently at the proposal stage under the new income tax framework. Until it is officially notified and made effective, Form 15G and Form 15H continue to be the operative documents for TDS exemption declarations.

Watch the official income tax portal for notification of Form 121's effective date, as it will directly affect how you declare nil tax liability going forward.

How to Submit Form 15G and Form 15H — Online and Offline

Both forms can be submitted through digital or physical channels. Most banks now offer a fully online route, which is faster and creates a digital record.

Online Submission

Log in to your bank's net banking portal. Navigate to the TDS declaration or Form 15G/15H section. Enter your PAN, estimated income for the year, and other required details. Submit digitally — the bank processes the declaration and your income is credited without TDS deduction going forward.

Offline Submission

Download Form 15G or Form 15H from your bank's website, the EPFO portal, or the income tax portal. Fill in all details manually, sign the form, and submit it at your bank branch or the relevant office in person.

Where to Submit Beyond Banks

• EPFO — for EPF balance withdrawal before five years of service
• LIC — for maturity proceeds, where TDS at 5% applies from September 1, 2019, rising to 20% if PAN is not submitted
• Post offices — digitised post offices accept both forms on deposit interest
• Tenants — for rent exceeding Rs 2.4 lakh annually where total tax is nil
• Insurance companies — agents earning commission above Rs 15,000 annually can file for nil TDS
• Mutual fund houses — for dividend income exceeding Rs 10,000
• Corporate bond issuers — for bond interest exceeding Rs 5,000

One specific situation where Form 15G does not apply: if your income must be clubbed with another person's income — such as interest from an FD held for a non-earning spouse or a minor child — the form is invalid in that case. TDS must be deducted in the name of the actual depositor, whose PAN is mandatory.

Forgot to Submit on Time — Here Is What You Can Do

Missing the April submission window is extremely common. Banks deduct TDS quarterly, so if you missed the first quarter, that TDS has already been deposited with the Income Tax Department.

Two paths are open to you.

File Your Income Tax Return and Claim a Refund

Once TDS is deposited by the deductor, it cannot be returned to you directly by the bank. The Income Tax Department processes refunds only after you file your ITR. Report all income, claim the excess TDS, and the refund is issued after verification.

Submit the Form Immediately for the Remaining Year

Don't wait. Submit Form 15G or Form 15H as soon as you realise the oversight. Since TDS is deducted quarterly, your submission will stop deductions for all remaining quarters of that financial year. For amounts already deducted, the ITR route is the only option.

Most people skip this second step — they assume the whole year is lost. It isn't.

Frequently Asked Questions

Where can Form 15G be submitted other than a bank? Form 15G can be submitted to the EPFO at the time of premature PF withdrawal, to corporate bond-issuing companies when bond interest exceeds Rs 5,000, to insurance companies by agents whose commission crosses Rs 15,000 annually, and to post offices for deposit interest. The condition in every case remains the same — your total tax liability for the year must be nil.

What should I do if I submitted Form 15G but my income turned out to be taxable? Inform your bank or deductor immediately that your total tax is no longer nil. The deductor will restart TDS deductions from that point. You must also report the complete interest income in your income tax return and pay any applicable tax. Filing the form when you know your income is taxable is a wrong declaration — and the penalties for that are serious.

Do I need to send Form 15G or 15H directly to the Income Tax Department? No. These forms go to the deductor — the bank, EPFO, insurance company, or whoever is making the payment subject to TDS. The deductor handles the processing and record-keeping. There is no requirement to submit these forms to the Income Tax Department separately.

Can NRIs file Form 15G or Form 15H? No. Both forms are restricted to residents of India. Non-resident Indians are not eligible to file either form, regardless of their age or the amount of their income. NRIs are subject to a different TDS framework under the Income Tax Act.

What is the penalty for a false or wrong declaration in Form 15G? Wrong declarations attract prosecution and financial penalties under Section 277 of the Income Tax Act, 1961. Where the tax sought to be evaded exceeds Rs 25 lakh, the minimum imprisonment is six months and may extend to seven years, along with a fine. In all other cases, imprisonment ranges from three months to two years with an accompanying fine.

Is Form 15G or Form 15H a replacement for filing an ITR? No. Submitting these forms is not a substitute for filing your income tax return. They only prevent TDS deduction at source based on your self-declaration. Your obligation to file an ITR separately — if you meet the filing criteria — remains fully intact regardless of whether you have submitted Form 15G or Form 15H.

What happens if I simply don't file Form 15G at all? No penalty applies for not filing Form 15G. It is a voluntary benefit the law provides to eligible taxpayers. Choosing not to file means TDS gets deducted on your income, but you can recover it later by filing your income tax return and claiming a refund. Penalties only arise from wrong or false declarations, not from choosing not to file the form.

The Takeaway — Submit Early, Know Your Form, Watch for Form 121

Three things to carry from this. First, Form 15G and Form 15H are not optional bonuses — for taxpayers with nil liability, they are the most direct way to protect your full income from unnecessary deduction. Second, submit at the start of April every financial year, covering all eligible income sources beyond just your bank FD. Third, keep track of Form 121 — the proposed unified replacement that will apply to all resident taxpayers regardless of age. Until Form 121 is officially notified, Form 15G and Form 15H remain operative. Check eligibility before filing, submit on time, and let your full income reach your account the way it should.