New Delhi, Business Desk. There is special news for senior citizens. Elderly customers investing in Post Office Senior Citizen Saving Scheme i.e. SCSS can avoid tax deduction i.e. TDS (Tax Deduction at Source) if they fill some forms in time.
If an elderly person in your household has invested lakhs of rupees or other large amount of his retirement fund in SCSS, then it is a good way for them to avoid tax deduction. Explain that in SCSS, tax is levied after a certain limit amount.
According to the Department of Post, he had received complaints that TDS has been deducted in his interest amount even after submitting Form 15G/15H. Therefore, the circles will have to take necessary action. For this, the Department of Post has issued a guideline.
- Tax exemption is applicable only when the account is seeded with 15G/15H.
- Whenever the SCSS account holder submits Form 15G/15H, the concerned post office will ensure that the CIF and SCSS account details of the customers are as per the list below.
- All CBS Post Offices shall ensure that all Form 15G/15H already received are updated in Finacle, as TDS deduction is based on the information available in CIF and Account level.
- CIF of SCSS account holders should be linked with valid PAN.
- TDS code is configured in CIF level for SCSS account holders. It should be only as TDSNR/TDSNS and not as NOTAX.
- The tax liability will be calculated based on the age of the subscriber and the interest payable for the financial year.
- TDS code NOTAX/TDSNR will be converted as TDSNS by batch process on the date the subscriber reaches 60 years of age.
- If PAN is invalid, TDS code will be converted into NOPAN/NOPNS by batch process in Finacle.
- Form 15G/15H should be updated on the date the form is received from the account holder.
- The 15G/15H should be updated using the CSCAM menu and verified without fail.
- Once 15G/15H is entered, the tax category at the account level will be updated to ‘No Tax’.