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Personal Finance News

SCSS query: What can senior citizens do if the bank deducts TDS even after submitting Form 15H?

rajeev kumar
By Rajeev Kumar

4 min read | Updated on April 21, 2025, 13:15 IST

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SUMMARY

SCSS account holders should submit Form 15H at the beginning of each financial year, preferably before the first interest income is credited to the depositor’s account.

TDS on SCSS

Form 15H should ideally be submitted at the beginning of each financial year. | Image source: Shutterstock

Senior citizens having income below the basic exemption limit can request banks not to deduct tax on interest income from Senior Citizen Savings Scheme (SCSS) deposits by submitting Form 15H.

However, many senior citizens complain that their banks have deducted TDS from SCSS interest income even after they submitted Form 15H.

For instance, SCSS account holder Kalpana Singh shared with us that she had submitted Form 15H for FY 2024-25. But the bank deducted TDS on the last quarter payment that came on April 2, 2025.

“I argued with the bank official, but he said that the validity of the form was up to March 31, whereas the interest was credited on April 2, and there was no Form 15H present in the bank. Please let me know when I should submit the form. What is the rule?,” she wrote after reading this article on SCSS interest payment rules.

Another SCSS account holder, Dominic D'Souza, also shared a similar complaint and said that deducting TDS even after submitting Form 15H defeats the very purpose of this form.

CA Dr Suresh Surana has answered the query as follows

1. What to do if the bank deducts TDS even after Form 15H submission

If TDS is deducted despite submitting Form 15H, then the following steps can be taken:

Confirm proper submission: The first step is to ensure that Form 15H was submitted before the first interest credit in the financial year. It must also be verified that the form was duly acknowledged by the bank and that the PAN was accurately quoted, as any discrepancy may lead to the form being rendered invalid.
Check PAN-Aadhaar compliance: It is important to confirm whether the PAN is linked with Aadhaar. As per CBDT norms, a non-linked PAN is treated as inoperative, which may result in TDS being deducted at a higher rate of 20%, irrespective of Form 15H submission.
Seek clarification from the Bank: The matter should then be taken up with the concerned bank branch. The senior citizen may request an explanation for the TDS deduction, despite submission of Form 15H. Often, such deductions occur due to internal delays in processing or system errors, which the bank can rectify on verification.
Claim refund by filing ITR: If it is confirmed that TDS was wrongly deducted, the ultimate course of action is to file the Income Tax Return (ITR) for the relevant financial year. Upon processing, the excess TDS deducted will be refunded by the Income Tax Department, provided the total income is below the taxable limit.

Senior citizen taxpayers should review Form 26AS or the Annual Information Statement (AIS) on the income tax portal to ensure that the TDS deducted is duly reflected. This helps in the accurate filing of the return and claiming the refund without delay.

If the bank fails to provide a satisfactory resolution, the issue may be escalated through the bank’s internal grievance redressal mechanism.

2. What is the best time to submit Form 15H?

Form 15H should ideally be submitted at the beginning of each financial year, preferably before the first interest income is credited to the depositor’s account. Timely submission ensures that the bank or deductor can process the declaration and avoid deduction of TDS on interest income right from the start of the financial year.

Although there is no statutory last date for submission, delayed submission may result in TDS being deducted on interest paid before such submission. While such TDS can be claimed as a refund by filing the income tax return, it may lead to blocking of funds and unnecessary procedural delays. Therefore, to ensure smooth processing and avoid unwanted TDS deduction, it is recommended to submit Form 15H in April, as early as possible in the financial year.

Upstox

About The Author

rajeev kumar
Rajeev Kumar is a Deputy Editor at Upstox, and covers personal finance stories. In over 11 years as a journalist, he has written over 2,000 articles on topics like income tax, mutual funds, credit cards, insurance, investing, savings, and pension. He has previously worked with organisations like 1% Club, The Financial Express, Zee Business and Hindustan Times.

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