Make sure you don’t miss extended tax filing deadline

The income tax return (ITR) filing deadline for financial year 2020-21 (FY21) for individuals has already been extended to September 30. Since then, the government has also extended deadlines for e-filing various forms, including 15G and 15H.

The new deadlines for uploading declarations in Form 15G/15H for the first quarter (Q1) is November 30. For Q2, the deadline is December 31.

What are Forms 15G and

15H?

I-T law allows taxpayers to receive certain incomes (like interest, dividend, rent, insurance commission, etc) without deduction of tax at source (TDS). Gopal Bohra, partner, NA Shah and Associates, says, “A taxpayer can avail such benefit only if the tax on his total income will be nil. He can do so by furnishing a declaration in Form 15G/15H along with a valid permanent account number (PAN).”

Form 15G is submitted by individuals below 60 years and Hindu Undivided Families (HUFS) while Form 15H is submitted by individual senior citizens.

When should you submit them?

These declarations have to be submitted to each deductor separately. Bohra says, “In case of repetitive payments (such as quarterly interest on bank deposits or multiple deposits with the same bank) from a single deductor, the taxpayer can furnish a declaration in Form 15G/15H at the beginning of the financial year and thereafter whenever his estimated total income changes.”

Banks deduct TDS when a depositor’s interest income exceeds ~40,000 in a financial year (~50,000 for senior citizens) under Section 194A of the I-T Act. Archit Gupta, chief executive officer (CEO), Clear, says, “These forms are valid for one financial year only. Therefore, individuals need to submit them at the start of every financial year to prevent TDS from being deducted from their income.”

They can be submitted anytime during the year, but should be ideally done before the income is credited the first time.

If you miss deadline

If a taxpayer fails to furnish these declarations, TDS gets deducted at the applicable rate. Once this happens, the assessee can do two things. Rahul Agarwala, chartered accountant and business partner, AGSM Advisory says, “If the assessee forgets to submit them in the first quarter, he should do so immediately to prevent further deduction during the current financial year. Later, he can claim TDS refund when filing his tax return.”

Points to remember

These declarations can be made in two ways. According to Naveen Wadhwa, deputy general manager, Taxmann, “They can be submitted using paper forms, or electronically after verification using an electronic process.” He further adds: “Declarations in these two forms can also be made using Aadhaar number instead of PAN, provided PAN and Aadhaar have been linked, or in cases where an individual holds Aadhaar but not PAN.”

While submitting declarations in Form 15G/15H, make sure you quote a valid PAN. If the PAN is invalid, the declarations will also become invalid.