How To Claim Refund Of Tax Deducted By Bank On Senior Citizen's FD

My mother, a senior citizen, has made some fixed deposits with various banks and has earned interest of Rs. 3.30 lakhs.  She had submitted Form 15G also for no deduction of tax at source but a bank has deducted tax at the rate 20 per cent on interest as she does not have a PAN. The bank advised her to file an ITR to claim the refund. What should we do to get the amount back? Can she file return without PAN card? 

As per Section 206AA, since your mother does not have a PAN number, the bank is obliged to deduct tax at the rate of 20 per cent on the interest even if your mother has submitted Form 15G.  Since your mother is a senior citizen, she is required to submit Form 15H and not 15G. A senior citizen can submit From 15H if the total tax on her income is nil.  So, in case there is no tax liability after taking into account deduction under Section 80C, your mother can submit Form 15H. In case, she does not have a PAN, she can submit her Aadhaar Number, which is a valid document in place of a PAN.

To claim the refund of tax already deducted by the bank, it is necessary to file her income tax return (ITR). Please note that your mother cannot file her ITR in case she does not have a PAN. Since your mother does not have a PAN, first of all you have to apply for a PAN. However, in case she has an Aadhaar Number, the same can be used in place of PAN to submit an ITR. The same can be furnished to the bank with a request to revise the TDS return submitted by them to mention PAN/Aadhaar number against her name. Unless the bank carries out this correction, your mother will not get credit for the tax deducted by the bank. Moreover, even if your mother submits From 15H, she has to furnish her PAN/Aadhaar, else the bank will again deduct 20 per cent tax on the whole of the interest. Please note that it is not mandatory for you to file your income tax return in all cases where the person has a PAN.

I invested 15 Lakhs in the year 2024-2025. Can I claim a deduction of Rs. 1.50 lakh in ITR for the financial year 2024-2025 and subsequent years on the basis of the amount invested in the year 2024-2025?

The deduction for Senior Citizen Saving Scheme is available in the year in which you make the deposit. Since the maximum limit of deduction under Section 80 C is Rs. 1.50 lakh you cannot get a deduction of more than 1.50 lakh in one year even if you deposit more money. So you can make the deposit under the senior citizen scheme in such a way that you are able to claim a deduction of Rs. 1.50 lakh for a maximum number of years if it suits you.

We have a flat jointly owned by me and my wife.  We have been letting out this flat intermittently. I have created a HUF with my wife and our son and have also obtained a PAN as well. The HUF came into existence since last three years i.e. birth date of my son. Can I get the rental agreement made in the name of my HUF? I mean, can I now show the income from such property under my HUF?

As per the provisions of Section 60 of the Income Tax Act, when a person transfers the income of an asset without transferring the asset, the income so transferred is required to be included in the hands of the owner of such asset. Since you and your wife are owners of the property, the income will be taxed in your hands even if the rent agreement is made in the name of the HUF and the rent gets credited to the bank account of the HUF. Even if you transfer the jointly owned flat in the name of the HUF, any income, including capital gains arising on the asset so transferred in its original form as well as from the asset converted into any other form from time to time, will be clubbed in your and your wife's hands as per the provisions of Section 64(2) of the Income Tax Act.

Balwant Jains is a tax and investment expert and can be reached at jainbalwant@gmail.com

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