How to File Form 15G and Form 15H to Avoid TDS on Fixed Deposits in India

Tax Deducted at Source (TDS) on fixed deposit interest is one of the most common concerns for individual investors in India. If your interest income from fixed deposits exceeds a certain threshold, the bank or financial institution is required to deduct TDS before crediting the interest. However, if your total income falls below the taxable limit, you can submit a self-declaration form to avoid this deduction. For FY 2025-26, this is done through Form 15G or Form 15H. From FY 2026-27 onwards, a new unified Form 121 replaces both forms under the Income Tax Act, 2025.

What Are Form 15G, Form 15H, and Form 121?

Form 15G is a self-declaration form submitted by resident individuals below the age of 60 and Hindu Undivided Families (HUFs) to a payer, declaring that their estimated total income for the financial year is below the basic exemption limit and that their final tax liability will be nil. Form 15H serves the same purpose but is exclusively for senior citizens, defined as individuals aged 60 years or above. For senior citizens, the condition is simpler: they need only declare that their estimated tax liability for the year is nil.

From April 1, 2026, the Income Tax Act, 2025 introduces Form 121 as a single unified self-declaration form, replacing both Form 15G and Form 15H. Under Form 121, the age-based distinction is eliminated. Any eligible taxpayer whose estimated tax liability is nil may submit Form 121 to the payer to avoid TDS deduction. This form applies from Tax Year 2026-27 onwards (i.e., the financial year beginning April 1, 2026). For returns filed in 2026 for FY 2025-26, Forms 15G and 15H remain applicable under the Income Tax Act, 1961.

Updated TDS Thresholds Under Section 194A

Section 194A of the Income Tax Act governs TDS on interest income other than interest on securities. The Union Budget 2025 revised the TDS thresholds significantly. For FY 2025-26 onwards, the threshold for TDS on interest from banks, cooperative societies, and post offices has been increased to Rs 50,000 per financial year for general depositors (up from the earlier Rs 40,000) and Rs 1,00,000 per financial year for senior citizens (up from the earlier Rs 50,000).

For interest from other sources (such as company deposits or NBFC deposits), the threshold has been increased from Rs 5,000 to Rs 10,000. When interest income exceeds these thresholds, TDS is deducted at 10% if the depositor has provided a valid PAN. If PAN is not furnished, TDS is deducted at 20%. The CBDT has also notified TDS exemptions for certain IFSC unit categories, which may be relevant for depositors with investments in International Financial Services Centre units. Investors with questions about securities-related settlements can explore the SEBI settlement helpdesk facility.

Eligibility Criteria for Filing Form 15G, Form 15H, and Form 121

To submit Form 15G (for FY 2025-26), you must be a resident individual below 60 years of age or a Hindu Undivided Family. Your estimated total income for the year must be below the basic exemption limit (Rs 2,50,000 under the old regime, or Rs 3,00,000 under the new tax regime). Additionally, the tax calculated on your estimated total income must be nil. PAN is mandatory.

To submit Form 15H (for FY 2025-26), you must be a resident individual aged 60 years or above. The only condition is that your estimated tax liability for the financial year must be nil. Note that there is no cap on the total income for Form 15H; even if the senior citizen's total income exceeds the basic exemption limit, they can submit Form 15H as long as the tax computed (after deductions, exemptions, and rebates) is nil.

From FY 2026-27, Form 121 under Section 393(6) of the Income Tax Act, 2025 (read with Rule 211 of the Income Tax Rules, 2026) replaces both forms. Eligibility for Form 121 requires that the declarant's estimated tax liability for the tax year is nil. The age-based distinction no longer applies. Depositors who need to update their Aadhaar details for identity verification should do so before submitting any self-declaration form, as linking PAN with Aadhaar remains mandatory.

How to Submit Form 15G or Form 15H

Form 15G and Form 15H must be submitted at the beginning of each financial year (ideally in April) to the bank or financial institution where you hold fixed deposits. The form can be submitted at any branch or through the bank's internet banking portal, where most banks now allow digital submission. You must submit a separate form to each bank or institution from which you receive interest income.

The form requires the following details: your name, PAN, residential address, the assessment year, estimated total income, estimated total income from the interest for which the declaration is made, and whether any earlier declarations have been submitted during the year. The bank is required to assign a Unique Identification Number (UIN) to each declaration and report all such declarations to the Income Tax Department. Investors concerned about TDS implications on education loan interest should note that Form 15G/15H applies only to deposit interest, not to loan interest payments.

Common Mistakes to Avoid

First, do not submit Form 15G/15H if your total income exceeds the basic exemption limit (unless, for Form 15H, your tax liability is genuinely nil after deductions and rebates). Filing a false declaration is an offence under the Income Tax Act. Second, do not forget to submit the form at the start of the financial year. If submitted after TDS has already been deducted, the bank cannot reverse the deduction; you would need to claim a refund by filing your income tax return.

Third, ensure your PAN is correctly quoted on the form. An incorrect PAN will result in TDS at the higher rate of 20%. Fourth, remember to submit separate forms to each bank or institution. A form submitted to one bank does not cover deposits held at another. Fifth, keep track of the transition to Form 121 from FY 2026-27 onwards, and confirm with your bank which form they are accepting. For other government-related application processes, such as applying for a passport or a Scheduled Tribe certificate, ensure that your PAN and Aadhaar are linked and up to date.

Key Takeaways

Form 15G (for individuals below 60) and Form 15H (for senior citizens 60 and above) allow eligible taxpayers to avoid TDS on fixed deposit interest by declaring nil tax liability. From FY 2025-26, the TDS threshold under Section 194A has been increased to Rs 50,000 for general depositors and Rs 1,00,000 for senior citizens on bank and post office interest. From FY 2026-27 (April 1, 2026), Form 121 under the Income Tax Act, 2025 replaces both Form 15G and Form 15H as a unified self-declaration. PAN is mandatory; without it, TDS is deducted at 20% instead of 10%. Submit the declaration at the start of the financial year to each bank or institution where you hold deposits. Filing a false declaration under Form 15G, 15H, or 121 is a punishable offence under the Income Tax Act.