A survey recently conducted by the income tax (I-T) department’s Tax Deducted at Source (TDS) wing on five urban cooperative banks in Surat for non-compliance of TDS provisions in the interest payments on the fixed deposits to the customers has revealed that the banks have paid huge amounts of interest to customers without deducting TDS, reports Times of India.
The UCBs covered under the survey are Surat Peoples’ Cooperative Bank, Surat District Cooperative Bank, Surat National Cooperative Bank, Prime Cooperative Bank and Surat Textile Cooperative Bank.
As per the provision, the banks have to ask for the declaration in Form15G/Form15H (prescribed under the Indian income tax law). The purpose of this declaration is to inform the bank that the individual’s annual income tax liability is nil and on that basis request the bank not to deduct tax at source from the interest.
Form 15H is exclusively meant for senior citizens (who are older than 65 years or turned 65 at any time during the previous year) and are tax residents of India, whereas Form 15G is for other categories of individuals. The forms are available with the respective bankers and are easily accessible.