What is Form 15G & How to Fill Form 15G for PF Withdrawal

Have you or someone from your immediate family invested in a fixed deposit, provident funds, or similar financial investment schemes? If yes, Form 15G is something you should know of. Form 15G is to be filled out by fixed deposit holders (who can be individuals under the age of 60 years or Hindu Undivided Family) to ensure that no TDS (Tax Deduction at Source) is subtracted from the interest income in a year.

As per recent income tax regulations, it is mandatory for all banks and financial institutions to deduct tax at sources for any interest earned on financial instruments like fixed deposits (FD), recurring deposits, provident funds, or others.

In keeping with this rule, the Employees’ Provident Fund Organization (EPFO) united portal launched a facility to submit Employee Provident Fund (EPF) Form 15G for PF online. This enables EPF members to withdraw their PF online and avoid TDS deductions on their investments.

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Key Features of Form 15G

Eligibility Criteria for Submitting Form 15G

To fill out EPF Form 15G or Form 15G for PF withdrawal, you must meet the following eligibility criteria:

When Can Form 15G Be Submitted?

Form 15G can be submitted to save TDS on any interest income or investment withdrawal during that financial year and needs to be submitted ideally at the start of the financial year to ensure that the deduction doesn’t take place. Since banks and other financial institutions usually have a quarterly TDS payment, a delay in filing Form 15G can lead to the TDS getting cut.

The investor will then need to get reimbursed via the Income Tax Department. The Form 15G for PF withdrawal and EPFO 15G Form needs to be submitted in one of the following or all instances as applicable:

Form 15G for Interest on Income From Bank Deposits

If you have made any investments with banks, such as a recurring deposit, fixed deposit, or other financial instruments, the interest amount you will earn will be tax-free, up to INR 10,000 in a year. (This was revised to INR 40,000 annually as per the regulation announced in FY 2019-20)

Any amount that exceeds INR 40,000 will be taxed. However, the bank TDS deduction is not required, so the TDS deduction can be avoided by filling out and submitting Form 15G for Fixed Deposits or other bank deposits.

Form 15G For PF Withdrawal or EPFO 15G Form

For TDS on Employee’s Provident Fund withdrawal, the employee has to fill out Form 15G, ensuring this deduction does not happen. If the employee’s Provident Fund withdrawal is prior to completing at least 5 years of services at the current organization, the TDS is applicable on proceeds.

However, even in this case, if the total taxable income, including the PF withdrawal balance, is zero, then submitting Form 15G for PF ensures a non-deduction of TDS.

Form 15G for Post Office Deposits

Similar to bank Deposits, any investment made with the Post Office is liable for getting TDS benefit. You can submit Form 15G declaration for your post office deposits and national saving scheme (NSS) and ensure that the TDS is not deducted.

Form 15G for Corporate Bonds or Debentures

For Corporate Bonds and Debentures that exceed INR 5000 for a financial year, you will be subjected to TDS.

However, if the amount is less and you are eligible, you can submit Form 15G for Corporate Bonds or Debenture investment and request the issuer of the bonds not to deduct TDS.

Form 15G for Life Insurance Policy

If you have invested in a Life Insurance Policy which has matured and you plan on withdrawing or getting interest income from this scheme, then you can ensure that the TDS on this amount is not cut. Under the provision of Section 194DA of the Income Tax Act, 1961, income from a Life Insurance Policy is exempt from TDS.

However, if this amount exceeds INR 1 lakh, such proceeds are subjected to tax deduction at source. So if you satisfy the conditions mentioned in Form 15G for Life Insurance Policy proceeds, you can submit Form 15G and prevent TDS deductions on this amount.

Form 15G For Rental Income

If you have rental income in the financial year that does not exceed INR 8 lakh, then you can fill out Form 15G for non-deduction of TDS and ensure that the TDS deduction is not cut from your account.

However, if your income in the financial year from rental income is higher than INR 8 lakh, then there can be no benefits and is liable for Tax Deduction at the source.

How to Fill Out EPF Form 15G?

To get EPFO 15G Form, you need to visit the EPFO UAN portal and search ‘EPF Form 15G Download’. You will get an option similar to the one shown in this image.

Once you have downloaded the form, you can fill out the EPF Form 15G on your own. You will need to know the appropriate amount and provide all the information correctly, which can be done by following the steps below:

The last section of the EPF Form 15G will require you to fill in the investment details for which the declaration is being filed. You will also enter the investment account number for the term deposit, life insurance policy, employee code, and other details.

So it is best to keep this handy when filling out the form to ensure that they are accurate. Once the EPF Form 15G is filled, you can do the following:

Instructions to Fill Out Form 15G for PF Withdrawal or Other Investments

To fill out Form 15G for withdrawal of PF, fixed deposits, or other financial investments, you can submit Form 15G online. Many banks in India are providing this facility, which can be done if you have a valid net banking facility. Here is the process to follow for the same:

What Is the Difference Between Form 15G and Form 15H?

A common misunderstanding is between Form 15G and Form 15H, which are self-declarations that individuals need to submit to their bank or the institutions requesting not to deduct TDS on interest or any other income as per the guidelines.

However, Form 15G and Form 15H are applicable for different criteria, which are as follows:

Form 15G Form 15H
Applicable for resident individuals or Hindu Undivided Family members or trust that is not a company or a firm with a maximum age limit of 60 years Applicable for resident individuals who are above 60 years (Senior Citizens)
Can be submitted by Hindu Undivided Family members Can be submitted by an individual only
Only applicable to Hindu Undivided Family members who have an income lower than the mentioned threshold Any senior citizen can fill out Form 15H irrespective of the annual income
The tax calculated on your total income is NIL Not applicable

Note: Non-resident Indians (NRIs) cannot avail of any benefits from either Form 15G or Form 15H as per regulations.

Things to Keep In Mind Before Investing in Form 15G

The Fine for Filling Out the Wrong Information in Form 15G

It would be best if you were sure about your filing for Form 15G, and it is recommended to speak with a financial expert on this. There is a penalty for submitting a false declaration using Form 15G, which can lead to a huge fine or even imprisonment under Section 277 of the Income Tax Act 1961.

The punishment includes -

FAQ

For what purposes can Form 15G be submitted?

Declaration of Form 15G can be submitted to reduce the TDS burden on the following cases:

When should you submit Form 15G?

Form 15G is applicable for that particular financial year, so it is necessary to ensure that it is submitted at the beginning of the financial year. As banks deduct TDS each quarter, filling out Form 15G at the beginning of the year will ensure that the bank does not deduct any TDS on your interest income.

It saves the hassle of filing a claim refund on your TDS. If you have not submitted your Form 15G in the first quarter of the financial year, make sure you do so at the earliest so that the TDS is not deducted for the remaining financial year.

If I am a Non-Resident Indian (NRI), do I need to submit Form 15G?

No, NRIs cannot submit Form 15G, as one needs to be a resident of India to be able to fill out and submit this.

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