RBI directive to banks on TDS

The Reserve Bank of India has asked banks to give an acknowledgment to depositors when they submit self-declarations in Form 15G and Form 15H (for non-deduction of tax at source).

Under Income Tax Rules, 1962, banks do not deduct tax at source once depositors submit declaration in Form 15-G/15-H. Form 15G is a self-declaration form submitted by individuals below 60 years to banks stating that their income is below the taxable limit.

Form 15H is submitted by those above 60. “ Despite submission of Form 15-G/15-H by customers, banks are deducting tax at source, at times. Such instances arise because either the forms are misplaced or a track is not kept of forms received in the branches,” the RBI said in a notification.

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