Enabling provision for filing of self-declaration in Form 15G/15H by recipient of rental income, for non-deduction of tax at source under section 194-I [Section 197A]
(i) Tax deductible under section 194-I on rental payments exceeding ` 1,80,000:
Under 194-I, tax is deductible at source for payments in the nature of rentexceeding the specified threshold of ` 1,80,000 in a financial year.
In spite of the threshold for deduction tax under this section, there still may be cases where the tax payable on recipient’s total income, including rental payments, will be nil.
(ii) Enabling provisions contained in the Act for furnishing self-declaration by recipients of income referred to in section 192A/193/194/194A/194DA :
Section 197A provides for furnishing of self-declaration in writing in duplicate in the prescribed form, declaring that the tax on his estimated total income of the relevant previous year would be nil. The prescribed form is Form No.15G in case of a person, other than a company or firm, and Form No. 15H, in case of a resident individual of the age of 60 years or more at any time during the previous year. If declaration is so furnished to the person responsible for paying tax, no deduction of tax shall be made by such person.
However, there was no such enabling provision for furnishing self-declaration by the recipient of rent, which is subject to tax deduction under section 194-I.
(iii) Enabling provision introduced for furnishing self-declaration by recipient of rent for non-deduction of tax at source under section 194-I:
In order to reduce compliance burden in such cases, section 197A has been amended for enabling persons, other than companies and firms, in receipt of rent, on which tax is deductible under section 194-I, to file self-declaration in Form No. 15G for non-deduction of tax at source to the person responsible for paying rent. Likewise, resident senior citizens in receipt of rent can file declaration in Form No. 15H for non-deduction of tax at source to the person responsible for paying rent.