CPC(TDS) feels glad to provide  you with the new feature of downloading Form 27D, the Tax Collection Certificate for Deductees forming part of TCS Statements, filed in the form of 27EQ.

Centralized Processing Cell (TDS) has observed from its records that Flag “B” (for 15G/H Forms) has been wrongly raised in the quarterly TDS Statements as per the provisions of section 197A(1B) of the Income Tax Act, 1961. Following are the provisions of section 197A(1B) for your ready reference:

“The provisions of this section shall not apply where the amount of any income of the nature referred to in sub-section (1) or sub-section (1A), as the case may be, or the aggregate of the amounts of such incomes credited or paid or likely to be credited or paid during the previous year in which such income is to be included exceeds the maximum amount which is not chargeable to income-tax”.

What is Form 15G/ H and its relevance :

  • Under section 197A of the Income Tax Act 1961, Form 15G / H is a self-declaration, which is provided by a person resident in India (not being a Company or Firm) to their deductor that the tax on his estimated total income of the previous year, in which such income is to be included in computing his total income, will be NIL.
  • The Declaration is made in the following Forms :
    • Form 15H – For Senior Citizens
    • Form 15G – For other than Senior Citizens

Consequences, if deductor wrongly raises Flag “B” for Forms 15G/H :

  • If the deductor raises Flag “B” for non-deduction of tax, despite the total payments made by him exceeding the taxable amount, this results into incorrect reporting in the TDS Statements.
  • Your attention is invited to provisions of section 201 of the Act, which reads as follows :
    • Where any person who is required to deduct any sum, does not deduct or does not Pay or after deduction, fails to pay,
      the whole or any part of the tax, then such person shall be deemed to be an assessee in default in respect of such
      tax.
  • Under section 277 of the Act, if a person makes a statement in any verification under this Act or under any rule made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true is punishable.
This may be noted that obligation to report each transaction correctly in the TDS statements, falls on the deductor and non-compliance amounts to incorrect verification of correctness of TDS statement.

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0 responses to “Flag raised for 15G/15H despite Income exceeding amount of exemption”

  1. Rajesh says:

    Once 15G is filed can it be cancelled?

  2. s sudarshana says:

    1. In case of senior citizen excluding the interest and taxable income estimate is less than taxable income, can give Form 15H as the interest of the FD is not guarenteed until it runs for the whole or part of the year to have any income. One has the option to close it at any time. However he shuld pay the advance tax, prefarably at least once in a quarter based on the actual interest income and ensure tax compliance.
    2. Cancellation of 15G/H is by a simple application to the bank asking it to deduct TDS with immediate effect. In case of non compliance by the bank/s, to pay advance tax in time and ensure tax compliance.
    3. Shares and mutual funds are taxable and only dividend is tax free. Four types of taxes are possible depending upon, short term/long term with or without STT.

  3. S.C.Gupta says:

    am a senior citizen& have invested Rs 1 lac u/s 80c, thus interest income upto Rs 350000 are tax free.If I pay tax on total income exceeding Rs 350000 as advance/self assessment tax. Wheather submission of FORM 15H is justified?

  4. Balwant Jain says:

    Dear SIVARAMAN VISWANATHAN
    the Words used in Section 197A(1C) and 197A(1) are estimated total income and not total estimated income. Estimated total income shall be estimated after giving benefits of deductions under various provisions of the Act. so effectively it will be estimated taxable income.

  5. Karan Thawrani says:

    can you put this in simpler words please? “Under section 197A of the Income Tax Act 1961, Form 15G / H is a self-declaration, which is provided by a person resident in India (not being a Company or Firm) to their deductor that the tax on his estimated total income of the previous year, in which such income is to be included in computing his total income, will be NIL.”

  6. A. Ranganathan says:

    Form 15H is n enigma to me

    Can somebody explain the purport of Schedules I, II, IV and V. Income from shares and Mutual Funds are not taxable in the hands of the investor. Why then am I asked to list “Details of shares which stand in the name of the declarant(sic) and beneficially owned by him”‘ The details asked for include distinctive number of shares, which in the present d mat world is not available

    Suppose I have deposits with three different Banks and receive interest from all the three of them more than the stipulated Rs. 10,000.00 have I to report such income to ALL the Banks, under schedule III listing in each case my deposits with the other two Banks? Does this not tantamount to making public my financial position to the other Banks and their employees?

    Schedule V is OK, It is not applicable to me in any case.

    Similarl

  7. Vinayak Hari Gadre says:

    It is observed from the wording of the Form 15H that it only states that tax on my estimated total income will be nil. Now the question is whether wording ‘total income’ is to be construed as ‘total gross income’ or ‘total taxable income’.

  8. Ishwardas Misra says:

    As for a senior citizen who has made investment in 80C, Rs 350000
    are tax-free. If he pays tax on total interest exceeding this amount in the form of advance tax/ self-assessment tax, then will not the tax deductible at source(bank) be nil and the verificaton statement in 15H justifiable ?

  9. Rajan says:

    Pls inform how i can recall or cancel the Form 15H submitted after realising that i have erred in submitting the same

  10. SIVARAMAN VISWANATHAN says:

    Form-15G/15H can not be given if the “total estimated income” and not “estimated taxable income” Please see subsec(1A) & (1B) of section 197A.
    Hence for a sr citizen if the TOTAL income (not the taxable income after 80C dedution)is more than 250.000 the TDS is deductible. Further the person who gives false declaration can be penalized Rs.100,000 or even 6 month in jail.

  11. Vinayak Hari Gadre says:

    If the total interest paid (say 3,50,000/-) to a senior citizen by a bank exceeds exempted taxable income ie 2,50,000/- his tax on the income will be NIL if he invests 1,00,000/- under Section 80C of the It Act. In such circumstances how it will be not in order for a bank to raise Flag”B”?

  12. Anil Kishore says:

    For 15H there is no binding that interest should be less than Rs2.50 Lac for senior citizens as he may invest in 80C and can save tax even if the total interest is more than Rs2.50 lac. Please clarify.

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