📢 Forms 15G & 15H to Be Replaced by Single Declaration Form – What Taxpayers Need to Know
In a significant move aimed at simplifying tax compliance, the Government has proposed replacing Forms 15G and 15H with a single consolidated declaration form for all eligible taxpayers. This change is expected to streamline the process of submitting self-declarations for non-deduction of Tax Deducted at Source (TDS) and reduce procedural complexities.
For years, Forms 15G and 15H have played a crucial role in helping eligible taxpayers avoid unnecessary TDS deductions on certain incomes. However, maintaining two separate forms has often led to confusion, duplication, and compliance errors. The proposed reform seeks to introduce uniformity and efficiency within the Income-tax framework.
Let us understand the background, current provisions, proposed changes, and how this reform may impact taxpayers.
📌 Understanding TDS and Self-Declaration Forms
Tax Deducted at Source (TDS) is a mechanism under the Income-tax Act, where tax is deducted at the time of making specified payments such as:
Bank interest
Fixed deposit interest
Recurring deposit interest
Dividend income
Certain commission payments
Insurance commission
Rent (in specified cases)
In many situations, TDS is deducted even if the taxpayer’s total income is below the basic exemption limit. To avoid such unnecessary deduction and the subsequent refund process, the law provides the facility of filing self-declaration forms — namely Form 15G and Form 15H.
🔹 What is Form 15G?
Form 15G is a self-declaration form submitted by individuals (other than senior citizens) and certain entities to request non-deduction of TDS.
Eligibility for Form 15G:
Individual below 60 years of age
Hindu Undivided Family (HUF)
Trust (in specific cases)
Resident Indian
Total income is below the basic exemption limit
Tax liability for the financial year is NIL
This form is typically submitted to banks or financial institutions to avoid TDS on interest income.
🔹 What is Form 15H?
Form 15H is similar to Form 15G but is specifically meant for senior citizens (60 years or above).
Eligibility for Form 15H:
Individual aged 60 years or above
Resident Indian
Tax liability after considering deductions is NIL
Unlike Form 15G, even if total income exceeds the basic exemption limit, a senior citizen can still submit Form 15H provided the final tax payable is zero.
⚠️ Issues with the Existing System
Although Forms 15G and 15H serve an important purpose, the dual-form structure has led to certain practical challenges:
1️⃣ Confusion Among Taxpayers
Many individuals are unsure which form to submit, especially those turning 60 during the financial year.
2️⃣ Duplication of Compliance
Financial institutions must manage two separate forms with largely similar information.
3️⃣ Errors in Filing
Incorrect form submission may lead to TDS deduction or compliance notices.
4️⃣ Administrative Burden
Banks and deductors must verify, store, and report multiple types of declarations.
To address these issues, the Government has proposed consolidating both forms into a single declaration format.
🆕 Proposed Single Declaration Form – Key Highlights
The proposed reform aims to:
✅ Replace Forms 15G and 15H with one unified declaration
✅ Reduce duplication of information
✅ Simplify documentation process
✅ Improve compliance tracking
✅ Enhance transparency in reporting
Instead of maintaining two separate forms based on age criteria, the new form is expected to include relevant fields where the applicant can specify age category and eligibility details.
This means the system will become more streamlined without compromising legal requirements.
📊 How Will This Benefit Taxpayers?
1️⃣ Simplified Process
Taxpayers will no longer need to determine whether to submit Form 15G or 15H. A single declaration reduces confusion.
2️⃣ Reduced Errors
A uniform structure lowers the chances of incorrect submissions.
3️⃣ Faster Processing
Banks and institutions can process declarations more efficiently.
4️⃣ Better Compliance
Uniform reporting may reduce scrutiny and mismatches.
5️⃣ Digital Integration
The new system may integrate better with online portals, improving ease of submission.
🏦 Impact on Banks and Financial Institutions
Financial institutions play a crucial role in collecting and reporting these declarations to the Income Tax Department.
The single declaration system will:
Reduce paperwork
Standardize verification procedures
Improve reporting accuracy
Lower administrative burden
Minimize reconciliation issues
In the long term, this will support smoother TDS compliance management.
👵 Special Note for Senior Citizens
Senior citizens often depend on interest income from fixed deposits, savings accounts, and other investments. For them, avoiding unnecessary TDS deduction is especially important for maintaining cash flow.
The proposed unified form will still protect the interests of senior citizens by allowing them to declare NIL tax liability. However, it will eliminate the need to maintain a separate form exclusively for age-based categorization.
📅 When Will This Change Take Effect?
As of now, the proposal has been announced, and detailed guidelines, implementation timelines, and format specifications are awaited. Taxpayers should continue using Forms 15G and 15H as per existing provisions until official notification and rules are released.
Staying updated with official circulars and notifications is essential.
⚖️ Important Compliance Considerations
Even with a simplified form, taxpayers must ensure:
Total income is correctly estimated
Deductions under Chapter VI-A are properly considered
No false declaration is made
PAN details are accurate
Declaration is submitted before interest credit/payment
Submitting incorrect declarations can lead to:
Penalty under the Income-tax Act
Interest liability
Prosecution in extreme cases
Hence, professional guidance is always advisable.
💡 Practical Tips for Taxpayers
To ensure smooth compliance:
✔️ Estimate your annual income before submitting declaration
✔️ Include all sources of income (salary, interest, rental, etc.)
✔️ Consider deductions like 80C, 80D, etc.
✔️ Submit declaration at the beginning of the financial year
✔️ Keep acknowledgment copy for records
🔍 Why This Reform Matters
India’s tax administration is steadily moving toward simplification, digitization, and improved transparency. Replacing Forms 15G and 15H with a unified declaration aligns with broader objectives of:
Ease of doing compliance
Reducing procedural redundancies
Enhancing taxpayer convenience
Strengthening reporting mechanisms
Such reforms reduce friction between taxpayers and tax authorities and promote voluntary compliance.
📌 Final Thoughts
The proposal to replace Forms 15G and 15H with a single consolidated declaration form marks an important step toward modernizing TDS compliance procedures.
While the change appears procedural, its impact will be meaningful in reducing confusion, administrative burden, and compliance risks for both taxpayers and financial institutions.
Taxpayers should stay informed and be prepared to adapt once the new format is officially introduced. Proper and timely submission of declarations remains essential to avoid unnecessary TDS deductions and refund delays.
Professional guidance ensures that declarations are accurate and aligned with the latest regulatory updates.
📞 Need Assistance with TDS & Income Tax Compliance?
📞 Contact us today: +91 7305701454
📧 Email: auditsiva2@gmail.com
🌐 Website: www.taxlaservices.com
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